View source for Jobs Potentially Destroyed Due to Access to Modern Energy Services

= Overview =

There are countless studies talking about [[Economic_Impact_of_Energy_Access_on_Individuals_and_the_Community|electrification and its benefits]]. According to this latest report from IRENA, the renewable energy sector has created more than 500,000 new jobs globally in 2017 and more than 10 million people are employed by the sector. <ref name="Renewable Energy and Jobs - Annual Review 2018 [Internet]. /publications/2018/May/Renewable-Energy-and-Jobs-Annual-Review-2018. [cited 2018 Aug 14]. Available from: /publications/2018/May/Renewable-Energy-and-Jobs-Annual-Review-2018">Renewable Energy and Jobs - Annual Review 2018 [Internet]. /publications/2018/May/Renewable-Energy-and-Jobs-Annual-Review-2018. [cited 2018 Aug 14]. Available from: /publications/2018/May/Renewable-Energy-and-Jobs-Annual-Review-2018</ref>This is the net effect of renewables on the job market. But what happens in the short run? What are the social and economic impacts on the society once it has gained access to the renewable energy sources? How does the dynamics of job market change once people have access to the modern services and tools? Are there any negative impacts on jobs related to modern energy access? <br/>

This article looks into the jobs that are destroyed when a village is electrified or has access to modern/renewable services






= Impacts of electrification on employment<br/> =

Access to modern energy sources include: [[Portal:Improved Cooking|access to clean cooking energy]], [[Electrification of Social Institutions with Solar Photovoltaic -Lessons Learned from Uganda|electricity for households as well as social institutions]] such as hospitals, schools etc. and [[Portal:Productive Use|energy for productive use]].<ref name="Access to Modern Energy: Assessment and Outlook forDeveloping and Emerging Regions [Internet]. [cited 2018 Aug 14]. Available from: http://www.iiasa.ac.at/web/home/research/researchPrograms/Energy/IIASA-GEF-UNIDO_Access-to-Modern-Energy_2013-05-27.pdf">Access to Modern Energy: Assessment and Outlook forDeveloping and Emerging Regions [Internet]. [cited 2018 Aug 14]. Available from: http://www.iiasa.ac.at/web/home/research/researchPrograms/Energy/IIASA-GEF-UNIDO_Access-to-Modern-Energy_2013-05-27.pdf</ref> It impacts labor productivity through different channels such as: electrical appliances makes household activities easy and faster to perform, access to electricity at night means longer working hours and appliances can be used for productive activities as well as more leisure activities.<ref name="Dasso R, Fernandez F. The effects of electrification on employment in rural Peru. IZA J Labor Dev [Internet]. 2015 Dec [cited 2018 Aug 14];4(1). Available from: http://www.izajold.com/content/4/1/6">Dasso R, Fernandez F. The effects of electrification on employment in rural Peru. IZA J Labor Dev [Internet]. 2015 Dec [cited 2018 Aug 14];4(1). Available from: http://www.izajold.com/content/4/1/6</ref>

The following summary table lists different studies that look into the impact of electrification on employment.<ref name="Bonan J, Pareglio S, Tavoni M. Access to Modern Energy: A Review of Barriers, Drivers and Impact [Internet]. 2016 [cited 2018 Oct 1]. Available from: https://www.econstor.eu/bitstream/10419/149541/1/NDL2016-068.pdf">Bonan J, Pareglio S, Tavoni M. Access to Modern Energy: A Review of Barriers, Drivers and Impact [Internet]. 2016 [cited 2018 Oct 1]. Available from: https://www.econstor.eu/bitstream/10419/149541/1/NDL2016-068.pdf</ref> Most studies do not find a negative impact of electrification on employment. Out of the 18 studies, only 2 identify decreasing impacts (however, small and only a shift towards non-agricultural activities).

Table:&nbsp;Causal impact of access to electricity on employment and labour market.<ref name="Bonan J, Pareglio S, Tavoni M. Access to Modern Energy: A Review of Barriers, Drivers and Impact [Internet]. 2016 [cited 2018 Oct 1]. Available from: https://www.econstor.eu/bitstream/10419/149541/1/NDL2016-068.pdf">Bonan J, Pareglio S, Tavoni M. Access to Modern Energy: A Review of Barriers, Drivers and Impact [Internet]. 2016 [cited 2018 Oct 1]. Available from: https://www.econstor.eu/bitstream/10419/149541/1/NDL2016-068.pdf</ref><ref>ESMAP: Productive Use of Energy – PRODUSE
Measuring Impacts of Electrification on Small and Micro-Enterprises
in Sub-Saharan Africa. https://www.esmap.org/sites/esmap.org/files/ESMAP_GIZ_BMZ_AEI_PRODUSE_Study_FullText_Optimized_0.pdf</ref><br/>

<u>'''Please add more studies by editing this table.'''</u><br/>

{| class="wikitable sortable" style="width: 762px" cellspacing="1" cellpadding="1" border="0"
|-
! scope="col" | Study&nbsp;<br/>
! scope="col" | Source of electricity
! scope="col" | Results
! scope="col" | Method
! scope="col" | Sample size
! scope="col" | Period&nbsp;
! scope="col" | Risk of bias
|-
| Barron and Torero (2015), El Salvador
| On-grid
| Increase in non-farm employment and in home business, particularly for women<br/>
| RCT
| 500 (HHs)
| 2007-2012 (4)
| low
|-
| 
Squires (2015), Honduras<br/>

| On-grid
| Increase in children employment rate; increase in female employment
| FE-IV
| 19,000 (HH)
| <br/>
| Medium
|-
| Dinkelman (2011), South Africa&nbsp;
| On-grid&nbsp;
| Increase in employement for women and no significant effect for men
| D-D-IV
| 1816 (community)
| 1996-2001 (2)
| Medium
|-
| Burlig and Preonas (2016), India
| On-grid
| 
Small decrease in share of men working in agriculture and small increase in non-agriculture activities&nbsp;<br/>

No effect on female employemnt

| RDD
| 30,000 (villages)
| 2001-2011 (2)
| 
Low<br/>

<br/>

|-
| Libscomb et al (2013); Brazil
| On-grid
| Strong effect on activity rate and employment in the formal sector, both in rural and urban areas.
| FE-IV
| 2184 (country)
| 1960-2000 (5)
| Low-medium
|-
| Grogan and Sadanand (2013); Nicaragua
| On-grid
| Significant increase in the propensity to work outside teh home for women. No effect for men
| FE-IV
| 6882 (HH)
| 1971-2005 (3)
| Medium
|-
| Bernard adn Torero (2015), Ethiopia
| On-grid
| No short-run effect of rural electrification on time spent on income generating activities
| RCT
| 563 (HH)
| (2)
| Low-Medium
|-
| Dinkleman (2011), South Africa
| On-grid
| Increase in labour supply for both women and men (only OLS)
| pooled OLS & FE
| 1816 (community)
| 1996-2001 (2)
| Medium
|-
| van De Walle et al (2015); India
| On-grid
| 
Significant substitution of days of work from causal wage works to regular wage and agriculture self-employment for men. Small significant reduction of female causal wage work.&nbsp;<br/>

Increase in male working hours, no effect on women. Decrease in the likelihood of having more than one job among males

| Panel data &IV
| 3000 (HH)
| 1981-1999 (2)&nbsp;
| Medium
|-
| Dasso and Fernandez (2015); Peru
| On-grid
| Women: higher employment, lower probability of working in agriculture sector
| FE
| 3989 (individuals)
| 2006-2012 (6)
| Medium
|-
| 
Alcazar et al. (2007), Peru<br/>

| On-grid/better supply&nbsp;
| Significant reduction in hours worked in agriculture and increase in non-farm activities
| PSM
| 6690 (HH)
| 2005
| 
Medium<br/>

|-
| 
Rathi and Vermaak (2018),South Africa & India

| On-grid
| 
In India: less hours for both genders but higher incomes. Men less likely to be employed. In South Africa no employment effects.

| PSM & FE
| 82130 (individuals)
| 2005-2012 (India); 2008-2012 (South Africa)
| -
|-
| Lenz et al. (2017); Rwanda
| On-grid
| No effect on time dedicated to income generation ot type of occupation.
| DID
| 974 (households)
| 2011-2013
| -
|-
| Goedhuys and Sleuwaegen (2010)<ref name="Goedhuys, M. and Sleuwaegen, L. (2010): High-Growth Entrepreneurial Firms in Africa: A Quantile Regression Approach. Small Business Economics Vol. 34, pp. 31-51.">Goedhuys, M. and Sleuwaegen, L. (2010): High-Growth Entrepreneurial Firms in Africa: A Quantile RegressionfckLRApproach. Small Business Economics Vol. 34, pp. 31-51.</ref><br/>
| On-grid
| Electricity connection in combination with generator causes employment growth<br/>
| quantile regression<br/>
| Firm-level data from the World Bank Investment Climate Survey in&nbsp;11 Sub-Saharan African countries<br/>
| -
| -
|-
| ESMAP (2005)<ref name="ESMAP - Energy Sector Management Assistance Program (2005): Study to promote productive uses of electricity in rural electrification projects in Tanzania. DataVision International Ltd.">ESMAP - Energy Sector Management Assistance Program (2005): Study to promote productive uses of
electricity in rural electrification projects in Tanzania. DataVision International Ltd.</ref>
| on/off grid
| Small enterprises shift from using family members to recruiting non-family full-time employees after electrification but no net increase in employment after electrification was found.<br/>
| -
| &nbsp;Enterprise survey with 320 connected and non-connected SMEs<br/>
| -
| -
|-
| Kooijman-van Dijk (2008, 2012)<ref>Kooijman-van Dijk, A. (2008): The Power to Produce - The Role of Energy in Poverty Reduction Through Small
Scale Enterprises in the Indian Himalayas. University of Twente. Enschede, Netherlands.

Kooijman-van Dijk, A. (2012): The Role of Energy in Creating Opportunities for Income Generation in the
Indian Himalayas. Energy Policy, Vol. 41, pp. 529-536.</ref><br/>
| -
| Overall positive effect of electricity access on employment, despite some cases in which manual labour is substituted with the use of electrical appliances.&nbsp;<br/>
| <br/>
| Qualitative survey of 264 small businesses<br/>
| <br/>
| <br/>
|-
| Grogan and Sadanand (2009)<ref name="Grogan, L. (2008): Community Electrification and Labour Market Development. Working paper, Department of Economics, University of Guelph.">Grogan, L. (2008): Community Electrification and Labour Market Development. Working paper, Department
of Economics, University of Guelph.</ref><br/>
| -
| Adoption of labour saving household technologies leads to significant reduction of time spent on household activities and of the fertility rate as well as to a significant increase of time spent on economic activities.<br/>
| -
| LSMS individual and community-level data<br/>
| -
| -
|}

<br/>

However, other studies have suggested that electrification could have negative impact at least in the transition phase on employment and those are explained below:

== Productive use of energy substitutes manual labour ==

Access to modern energy services facilitates new productive activities (income generating activities) which were initially not feasible or unprofitable without electricity. The income generation activities could be poultry farming, carpentry, hotels, restaurants etc. People also have access to electronic appliances such as TV, fan etc. which changes their social life .<ref name="Winther T, Wilhite H. Tentacles of Modernity: Why Electricity Needs Anthropology. Cult Anthropol. 2015 Nov 9;30(4):569–77.">Winther T, Wilhite H. Tentacles of Modernity: Why Electricity Needs Anthropology. Cult Anthropol. 2015 Nov 9;30(4):569–77. </ref> This also changes the way people do their work. For example, access to electric mills means you will no longer need labors to manually mill the products. Also use of electric appliances in tailoring, carpentary and other industry also reduces the need for labor. This changes the labor market and the types of employment in the long term. However, in the short term, there is not much change in the labor market as it takes time to implement productive activities.&nbsp;<ref name="Grogan L. Community Electriﬁcation and Labour Market Development. 2008;37.">Grogan L. Community Electriﬁcation and Labour Market Development. 2008;37. </ref>

[[Portal:Productive Use|For more information about productive use of electricitiy, see the Productive Use portal on energypedia.]]

== Shift from agriculture towards more payed work ==

Electrification provides diversification of income (mostly from agriculture) in developing countries.<ref name="Grogan L. Community Electriﬁcation and Labour Market Development. 2008;37.">Grogan L. Community Electriﬁcation and Labour Market Development. 2008;37. </ref> [https://izajold.springeropen.com/track/pdf/10.1186/s40175-015-0028-4 This study] about the impact of rural electrification in Peru found out that in the areas included in a electrification program, households with electricity worked more hours in non-farm activities than families without electricity. This can either suggest increased productivity in the agriculture or loss of labor hours in the agricultural sector.<ref name="Dasso R, Fernandez F. The effects of electrification on employment in rural Peru. IZA J Labor Dev [Internet]. 2015 Dec [cited 2018 Aug 14];4(1). Available from: http://www.izajold.com/content/4/1/6">Dasso R, Fernandez F. The effects of electrification on employment in rural Peru. IZA J Labor Dev [Internet]. 2015 Dec [cited 2018 Aug 14];4(1). Available from: http://www.izajold.com/content/4/1/6</ref> A study from IEA also suggests that access to electricity in agriculture may initially decreases job opportunities especially for women. Access to electricity increases the efficiency and productivity, and thus, less labor hours are required as compared to the previous situation.<ref name="IEA. Energy Access Outlook 2017 [Internet]. [cited 2018 Oct 1]. Available from: https://www.iea.org/publications/freepublications/publication/WEO2017SpecialReport_EnergyAccessOutlook.pdf">IEA. Energy Access Outlook 2017 [Internet]. [cited 2018 Oct 1]. Available from: https://www.iea.org/publications/freepublications/publication/WEO2017SpecialReport_EnergyAccessOutlook.pdf</ref>

<br/>

== Loss of jobs in the kerosene/charcoal market ==

According to the World Bank, 15 million people are employed across Sub-Saharan Africa in both formal and informal wood fuel-sector.<ref name="Kammila S, Kappen JF, Rysankova D, Hyseni B, Putti VR. Clean and improved cooking in Sub-Saharan Africa [Internet]. The World Bank; 2014 Nov [cited 2018 Oct 4] p. 1–182. Report No.: 98667. Available from: http://documents.worldbank.org/curated/en/879201468188354386/Clean-and-improved-cooking-in-Sub-Saharan-Africa">Kammila S, Kappen JF, Rysankova D, Hyseni B, Putti VR. Clean and improved cooking in Sub-Saharan Africa [Internet]. The World Bank; 2014 Nov [cited 2018 Oct 4] p. 1–182. Report No.: 98667. Available from: http://documents.worldbank.org/curated/en/879201468188354386/Clean-and-improved-cooking-in-Sub-Saharan-Africa</ref> Access to clean cooking solutions and renewables such as solar lights reduces the dependence on firewood and fossil fuels such as kerosene and charcoal for cooking and lighting purposes. This could result in less demand for these products and also in less jobs along the kerosene/charcoal value chain. Since it is an informal sector, it is not exactly clear how and to what extent the kerosene/charcoal job market changes. For example, [https://www.sciencedirect.com/science/article/pii/S0973082615303185 according to this study], interviews were conducted among kerosene vendors in informal markets in Malawi and Kenya to assess how the sales have decreased due to solar LED-lights. The study found that the decreasing demand for kerosene was not disruptive as most of the vendors sold kerosene along with other products and thus have adopted to the changing pattern.<ref name="Mills E. Job creation and energy savings through a transition to modern off-grid lighting. Energy Sustain Dev. 2016 Aug;33:155–66."> Mills E. Job creation and energy savings through a transition to modern off-grid lighting. Energy Sustain Dev. 2016 Aug;33:155–66. </ref> This is however, one point along the value chain and for an overall impact, the whole value chain has to be analyzed. The other people in the value chain such as people collecting the firewood, bringing it to the market etc. might be differently impacted.


= Conclusion =

Most studies concerning job impacts focus on the gain in employment. Only very few studies focus on the loss or change in employment patterns. For a holistic view, it is important to conduct more studies that focuses on the transition in jobs, during both short and long term to identify the net effect on jobs due to access to modern energy. Some of the question that needs to explored are:

*Who are the actors along the value chain (both in formal and informal markets)?
*How has the access to modern services impacted these actors in the short and the long term?
*What is the net impact on employment in the short term as well as long term?

'''Finally, the following table summarizes the impacts of employment into categories. Please feel free to edit and add your points to this table.'''

{| border="0" cellspacing="1" cellpadding="1" style="width:100%;" class="wikitable sortable"
|-
! style="width: 185px;" scope="col" | Jobs extinct
! style="width: 242px;" scope="col" | Transition phase
! style="width: 333px;" scope="col" | New jobs created
|-
| style="width: 185px;" | 
Manual labor is substituted in

*electric mills
*carpentry
*tailoring
*ice making
*bottling water

| style="width: 242px;" | Workers are laid off as the electrical appliances increases the labor productivity and less labor is required.<br/>
| style="width: 333px;" | 
New appliances offer income generating activities

*new business such as carpentry, poultry etc
*TV = movie theater in a restaurant
*Hotel for tourists due to hot showers (solar heating)
*Lighting at nights so that business run longer

|-
| style="width: 185px;" | 
Traditional resource jobs are going extinct in

*charcoal
*Kerosene markets
*Firewood collection

| style="width: 242px;" | 
Less demand for these products means there is less work for the vendors and other people along the value chain.

| style="width: 333px;" | 
Sales force of new appliances

*solar products seller
*cookstoves producers

|-
| style="width: 185px;" | 
Agricultural tasks are more efficient

*solar water irrigation
*oil pressing
*drying and cooling

| style="width: 242px;" | <br/>
| style="width: 333px;" | 
Non-farm work increases (potentially higher income)[1]&nbsp;

*animal husbandry in the free time
*shops or other entrepreneurship

|-
| style="width: 185px;" | <br/>
| style="width: 242px;" | <br/>
| style="width: 333px;" | 
New possibilities create more demand for more energy

*charging of mobile phones
*internet cafes
*Shops can sell cold drinks (solar cooling)

|}

<br/>

Also, there are social factors to consider. In many closely-knit communities, the people might have access to modern services, but still allow your neighbor to work on your farm to maintain social relationships. There has not been much literature exploring the social facets and hence it is important to also look at the social aspect while looking at the net effect on employment.

<br/>


= Further Information =

*[[:File:Green_Jobs_-_Impacts_of_a_Green_Economy_on_Employment.pdf|Green Jobs - Impacts of a Green Economy on Employment.pdf]]<br/>
*[[Social_Aspects_of_Grid_Interconnection|Social Aspects of Grid Interconnection]]<br/>
*[[Economic_and_Financial_Impacts_of_Grid_Interconnections|Economic and Financial Impacts of Grid Interconnections]]<br/>
*[[Portal:Energy_Access|Energy access portal on energypedia]]<br/>
*[[:File:EN_Renewable_energy_and_energy_efficiency_in_Tunisia_GIZ_2012.pdf|Promotion of Renewable Energies and Energy Efficiency in Tunisia - Employment, Qualification and Economic Effects":]]<br/>


= References =

<references />

[[Category:Productive_Use]]
[[Category:Energy_Access]]
[[Category:Employment]]
[[Category:Rural_Electrification]]
[[Category:Cooking_Fuels]]