Democrats seek new office to aid Michigan with green energy job losses

• Michigan’s Legislature will consider creating a state office to deal with business closures and job losses tied to green energy shifts
• The economic transition office would target the automotive industry as it braces to make more EVs and fewer gas-fueled vehicles
• Bills to create the office are not yet scheduled for votes

Though environmentalists have touted Michigan’s role as a national leader in clean-energy job growth, state lawmakers are focused on residents who could lose their jobs to green technology.

The Legislature is considering bills that would establish an economic transition office focused on helping workers and communities facing job losses related to: 

• The automotive industry’s shift from internal combustion engine (ICE) vehicles in favor of electric vehicles (EVs). (Nearly 20 percent of Michigan’s workforce is tied to the auto industry).
• Shut-downs of coal-fired power plants that will leave communities without major employers.

Proposals in both the House and Senate seek to start an economic transition office in the Department of Labor and Economic Opportunity.  =

One sponsor, Sen. Sam Singh, D-East Lansing, said the move will allow the state to plan for disruption by retraining workers before they’re unemployed and by preparing communities to attract new businesses and replace lost tax revenue.

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“Embracing clean energy and new advancements in technology can be done in such a way that does not leave workers behind,” said Rep. Jasper Martus, D-Flushing, a House sponsor.

The bills were initiated shortly before a special report from Bridge Michigan in September examined the lingering effects of automotive disinvestment in the state, including how closed factories with ongoing contamination have left the public with expensive cleanup costs.

> Read Bridge Michigan's report on the state's industrial legacy

The proposals also come as the United Auto Workers — whose strike against General Motors, Ford Motor Co. and Stellantis is now in its second month — demand provisions in their next contract that would protect workers from the likelihood of job losses as auto companies no longer need engines, fuel pumps and other ICE-related car parts. 

Job losses in energy-related fields so far have been mild but the annual U.S. Energy and Employment Report (USEER) from the federal Department of Energy showed that Michigan lost 5 percent of its energy jobs from 2018 to 2022. Gains came for motor vehicle workers, which is the majority of the category, but jobs declined in energy transmission, energy efficiency, and fuels. Energy workers accounted for just under 400,000 of the state’s 4.9 million workers. 

So far, decommissioning Michigan’s coal-fired power plants has resulted in few job losses, legislators said. A Consumers Energy spokesperson told Bridge that both unionized and other workers typically get a chance to remain with the company, due in part to the fact that shutdowns are planned years ahead of a plant’s final day. DTE Energy has a no-layoff commitment that it will honor as it shutters its final coal plants by 2032, a spokesman said.

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Michigan’s proposal for an economic transition office was recommended by the World Resources Institute (WRI), a Washington-based nonprofit focused on the green transition. The group issued a report in May on the net impact of green jobs on Michigan’s automotive employment. The report found that defining potential job losses from EVs is difficult, but the state could lose 47,000 jobs or gain 56,000, depending on the state’s success in attracting new EV-related businesses.

The bills to create an economic transition office were introduced in September. They were modeled after those in other states, such as Minnesota, New York, Colorado and Illinois, which is in the midst of making its first funding awards. 

Michigan House Republicans so far have expressed doubts about the bills. 

“We're creating a solution for a problem that doesn't exist yet … Now we're going to have another layer of bureaucracy to pick winners and losers,” Rep. Tom Kunse, R-Clare, said Thursday as he asked about the cost to the state. 

The proposal, backed mainly by Democrats, comes with no cost estimate so far, Singh said. Sponsors expect it to coalesce existing state workforce initiatives and enlist Treasury Department officials to aid communities facing revenue losses from plant closures. If passed, the new office likely would require some new staff, Singh said.

While several union officials spoke in support of the bills Thursday, business leaders were more skeptical. Amanda Fisher, state director of the National Federation of Independent Businesses, told Bridge she’s been against the proposal since hearing it rolled out in a Senate hearing in September.

Fisher, who represents about 10,000 small businesses in the state, said the proposed office will be created by Democrats in response to their green energy policy that calls for an end to the use of fossil fuels.

“Pushing policy and then creating an office to help fix the problems the policy will cause … is not the role of government,” Fisher said this week.

The economic transition office, she said, suggests that “some employees are more important than others.”

But Martus said during the hearing that the initiative is not a response to Michigan’s energy policy.

“The private sector is already miles ahead of what we're working on here in Lansing,” he said. “Innovations in electric vehicles and the embracing of solar and wind energy are not occurring right now in Michigan because of government mandates.”

The bill advanced from the Senate’s labor committee and will be addressed by the full Senate, but no date has been set. The House labor committee did not vote on Thursday.