November 3, 2008

Speaking of Hope

I don't usually expect to find hope in the NYT Business section, but this weekend was an exception. An article on green jobs in the Midwest drew what looked to me like a fairly convincing virtuous circle. Let me say that I've been to this point skeptical about green jobs - not that they won't exist, but whether they will represent an engine of job growth that can replace the disappearing manufacturing and low-level white collar jobs, especially in the industrial Midwest. For proof, I just look at Silicon Valley which, for all its success, doesn't actually employ all that many people and never truly replaced the jobs lost in the 90s' collapse of California defense contractors.

That said, this article made me think there could be something to this whole green jobs thing. What's interesting about it is that, as the NYT describes it, proximity has become important again.

The article focuses on the growing wind turbine assembly industry in Iowa. Why Iowa? Well, Iowa is "[p]erched on the edge of the Great Plains -- the so-called Saudi Arabia of wind." These turbines are so enormous that you want to make them as close as possible to the location you want to use them. Off-shoring simply isn't an option. TPI, an Arizona turbine blade company, was looking for a location to site their new plant and ended up in Iowa. The reason - and when was the last time you heard that this mattered for manufacturers:
Although TPI was considering a site in Mexico with low labor costs, Newton had a better location. Rail lines and Interstate 80 connect it to the Great Plains, where the turbines are needed.
Rail lines?! Interstates!? Holy 20th century, Batman! No wonder the Rust Belt is taking notice.

While the proximity issue isn't paramount for every green industry, certainly wind - which may be used to generate one-fifth of US electricity by 2030 according to the DOE - and perhaps even solar (panels are, after all, made of GLASS!) will find that proximity to the customer will matter. If that's the case, we get to our virtuous circle. Like the auto industry of old, which was a web of manufacturers and suppliers based near one another, the clean tech industries may spin something similar, trapping some significant numbers of jobs currently flying overseas. Now that's a hopeful thought for the dawn of a new era, isn't it?

Photo by hddod used under CC license

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Blogger charliereece said...

Stories like this remind me why Canada and Russia don't have the world wind power market cornered -- you need proximity to transportation, and the empty spaces on the maps of those countries don't have enough of it. We do.


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