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Job displacement costs of phasing out coal

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  • Rud, Juan-Pablo
  • Simmons, Michael
  • Toews, Gerhard
  • Aragon, Fernando

Abstract

The reduction of carbon emissions will require a rapid phasing out of coal and the displacement of millions of coal miners. How much could this energy transition cost mining workers? We use the dramatic collapse of the UK coal industry to estimate the long-term impact on displaced miners. We find evidence of substantial losses: hourly wages fell by 40% and earnings fell by 80% to 90% one year after job loss. These losses are persistent and remain significantly depressed fifteen years later, amounting to present discounted value earnings losses of between four and six times the miners pre-displacement earnings.

Suggested Citation

  • Rud, Juan-Pablo & Simmons, Michael & Toews, Gerhard & Aragon, Fernando, 2024. "Job displacement costs of phasing out coal," Journal of Public Economics, Elsevier, vol. 236(C).
    • Handle: RePEc:eee:pubeco:v:236:y:2024:i:c:s0047272724001038
    DOI: 10.1016/j.jpubeco.2024.105167
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    More about this item

    Keywords

    Displacement; Mining; Unemployment; Earnings;
    All these keywords.

    JEL classification:

    • J30 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - General
    • J63 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Turnover; Vacancies; Layoffs
    • J64 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Unemployment: Models, Duration, Incidence, and Job Search
    • O4 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity

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