The U.S. solar industry lost about 9,800 jobs in 2017, ending a seven-year streak of nonstop growth and reducing its size to about 250,000 people, according to a new census from the nonpartisan Solar Foundation released Wednesday.
It’s the first employment decline since the Solar Foundation began tracking jobs in 2010. The industry lost 3.8 percent of its jobs last year.
“It’s definitely been a tough year for the solar industry for a number of reasons,” says Avery Palmer, a spokesman for the Solar Foundation. The number of new solar installations also fell in 2017.
While the slowdown isn’t unexpected, it comes at an ominous time, and it suggests that the United States will not be able to avert the worst of climate change without further changing its policies. While several gigawatts of solar power were added to the U.S. electrical grid in 2017, solar power still only hovers around 1 percent of the power mix.
It seems noteworthy that the solar industry lost a large number of jobs during President Trump’s first year in office, given that his enthusiasm has been reserved for coal and coal alone. And the industry is concerned about what’s in store for it under Trump: Some industry groups even predict that Trump’s policies will kill tens of thousands of solar jobs.
But according to energy experts, it’s not quite right to connect this dip with Trump.
“I’m honestly not sure how much of a Trump effect there was in 2017,” said Varun Sivaram, who studies energy at the Council on Foreign Relations, a nonpartisan think tank. “But there will certainly be a Trump effect going forward—in 2018, 2019, and 2020.”
Instead, blame for 2017’s numbers lies with something far more mundane: the solar-investment tax credit. That policy, which lets taxpayers erase up to 30 percent of their tax liability by installing solar power, was originally supposed to expire at the end of 2016. As the deadline neared, companies and utilities rushed to take advantage of it, building as much solar power as possible in order to maximize their savings.
Ultimately, President Obama and a Republican-controlled Congress extended the tax credit and decided to phase it out in 2021. (The extension was left intact by last year’s Republican tax bill.) But because people were anticipating an end to the credit in 2016, the production glut was already scheduled, so utilities spent less on solar installation in 2017.
Given that background, Sivaram said the decline “wasn’t surprising at all.”
“The annual installed solar capacity dropped substantially in 2017, and that was mostly because of the [solar tax credit] expiration,” he told me. “It makes sense that jobs would have been lost, because installation jobs relate to how much is getting installed.”
Indeed, the Solar Foundation found that about the majority of the job losses—about 7,500 of 9,800 total—were shed by installation companies. As fewer solar panels were getting installed, those companies also needed fewer people to build and advertise them.