Big Oil ‘Exaggerates’ Jobs to Stall Climate Action, New Report Alleges

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Work crews from Winkelman's Environmentally Responsible Construction (WERC) and Trillium Development readied a SES wind turbine for lifting atop 160 foot tower at the School of Environmental Studies in Apple Valley, Minnesota. Credit: Star Tribune via Getty Images

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Just a week after receiving similar criticism from congressional Democrats, Big Oil is once again facing allegations of misleading the public in an attempt to stall climate action and protect its bottom line. 

In a report published Monday, environmental advocacy group Food and Water Watch accuses the industry’s biggest trade association of exaggerating the number of nationwide jobs created and sustained by oil and gas companies by more than 10 million. Fossil fuel advocates cite those inflated numbers, the report’s authors argue, when lobbying against fracking bans, drilling limitations and other policies aimed at reducing U.S. greenhouse gas emissions.

The American Petroleum Institute’s most recent “State of American Energy” report, which uses the trade association’s estimates from 2019, “claims that 11.3 million jobs are supported by the oil and gas industry,” Food and Water Watch wrote in its Monday report. “In reality, there were only 695,000 oil and gas jobs nationally in 2019.”

“The oil and gas industry and its proponents are misleading the public and policymakers about the economic benefits produced by this destructive industry,” the report’s authors added. “Their false claims do not add up and cannot be allowed to stall a rapid transition to 100 percent clean, renewable energy.”

Both the American Petroleum Institute, or API, and Food and Water Watch use government data in their analyses—though API draws from the Bureau of Economic Analysis, while Food and Water Watch pulls its numbers from the Bureau of Labor Statistics. But the environmental group said in its report that the main reason for API’s much higher estimate is because it includes “entirely unrelated jobs,” such as truck drivers and wholesalers, who deliver or sell fossil fuel products, and even companies that manufacture asphalt and roofing materials made from petroleum.

Gas station jobs, including those from attached convenience stores, account for roughly half of the jobs cited in fossil fuel industry studies, the report added.

Those “indirect” or “induced” jobs come mostly from fossil fuel industry supply chains and from the wages employees spend at other businesses, rather than from oil and gas companies themselves, the report said, and could easily be replaced by clean energy jobs. Truck drivers, for example, could deliver parts for wind farms and solar systems, wholesalers could sell them, and manufacturing plants could build them.

“In other words, the jobs that these companies identify as being endangered” by climate action “would only be ‘lost’ if the alternative to investment in oil and gas had nothing to do with capital and did not involve using power or energy,” the report’s authors conclude. “This is a false choice.”

The American Petroleum Institute rejected the conclusions of Monday’s report, calling it “misleading” and saying it reflects the authors’ “fundamental misunderstanding of how our industry benefits all sectors of the economy.”

“There’s no question that America’s natural gas and oil industry has been a complete game-changer for local economies, supporting hundreds of thousands of jobs across the country and lowering household energy costs, all while strengthening our energy security and driving environmental progress,” an API spokesperson said in an email to Inside Climate News.

But the Food and Water Watch’s assessment appears to align more squarely with the Department of Energy’s 2021 analysis on U.S. energy sector jobs, which found that clean energy jobs led the sector’s boom in employment last year, while jobs for gas, coal and petroleum companies declined by more than 29,271, or about 3.1 percent. The International Energy Agency also estimated in its annual “World Energy Employment Report,” published earlier this month, that up to 14 million new clean energy jobs worldwide could be created by 2030, with another 16 million workers expected to switch to new roles related to clean energy.

The Food and Water Watch’s report marks the second time this month that fossil fuel companies have faced public scrutiny over how their products impact climate change and the sincerity behind their commitments to address it. Facing mounting public pressure, the world’s top oil companies have announced goals in recent years to either transition to renewable energy sources or at least reduce their carbon footprint.

A February study, published in the peer-reviewed journal PLOS One, however, found that the four biggest oil majors—Exxon, Chevron, Shell and BP—aren’t following through on those commitments as they continue to prioritize investments in new oil and gas development. And last week, House Democrats released a series of internal documents that they say proves oil companies are continuing to mislead the public on climate change, undercut global efforts to reduce greenhouse gas emissions and push unproven technological solutions as a way to continue selling fossil fuels.

Those documents, which were subpoenaed in a House investigation on climate disinformation, include an email sent to Exxon’s chief executive that discusses how to weaken an industry-wide climate commitment, a guidance memo warning Shell employees to “not give the impression that Shell is willing to reduce carbon dioxide emissions to levels that do not make business sense” to avoid attracting lawsuits from investors, as well as an email from one Shell employee who said the company’s “net zero” pledge “has nothing to do with our business plans.”

In fact, Big Oil has been facing similar allegations for years, if not decades. Since 2017, at least 20 lawsuits have been filed by U.S. cities and states against leading oil companies, accusing them of downplaying the consequences of burning fossil fuels to consumers and investors, despite knowing for decades that their products were causing historic and devastating climate change.

But those allegations, and their broader implications for the world, appear to be coming to a head this year, as fossil fuel companies reap record-breaking profits and as nations discuss ways to pay for the international effort to curb the climate crisis.

Accelerated by the pandemic recovery and the Russian war in Ukraine, both of which experts say have upended global geopolitics and largely contributed to sky-high energy costs, fossil fuel companies around the world are now making some of their largest profits on record. Altogether, Exxon, Chevron, Shell, BP and TotalEnergies made $55 billion in the second quarter of 2022 alone, with Exxon posting its biggest quarterly profit in history at $17.9 billion. 

At the same time, hundreds of millions of people around the world are paying record-high prices at the pumps and on their energy bills. That has sparked criticism from several top U.S. lawmakers, who have accused the companies of using their recent profits to line the pockets of executives and investors, rather than help struggling everyday Americans. “Instead of using these windfalls to lower prices, oil companies are instead buying back their own stock and increasing shareholder dividends,” the office of Energy and Commerce Committee Chairman Frank Pallone, Jr. (D-NJ), wrote in a press release last month.

Big Oil is feeling the heat on the global stage as well. In his opening speech at the 77th United Nations General Assembly, being held this week in New York City, U.N. Secretary-General António Guterres urged all developed economies to tax fossil fuel companies to pay for efforts to help “people struggling with rising food and energy prices” and “countries suffering loss and damage caused by the climate crisis.”

“It is high time to put fossil fuel producers, investors and enablers on notice,” Guterres said. “Polluters must pay.”

It’s an issue the authors of the Food and Water Watch report highlighted as well, pointing to the industry’s declining employment rate, even as domestic fossil fuel production increased. Since 2014, the report said, oil and gas companies increased their production by 33 percent, while industry jobs declined 37 percent. In 2021, the latest available year for government employment data, oil and gas companies directly employed just over 500,000 workers nationwide, according to the environmental group’s report. That’s 50,000 fewer than the total number of jobs an API representative claimed would be lost in Pennsylvania alone after state regulators voted last year to ban fracking in the Delaware River Basin.

“While the oil and gas industry uses promises of employment to gain political leverage, increased production does not actually guarantee more jobs,” the Food and Water Watch authors said. “And 2021 shows that even when production returns, jobs continue to be cut.”

That’s it this week for Today’s Climate. Thanks for reading, and I’ll be back in your inbox on Tuesday.

Today’s Indicator

$207 billion

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