In a commentary on the Natural Resources Defense Council blog, the organization’s Director of Renewable Energy Policy Nathanael Greene criticizes the ethanol industry for what he calls a “highly inflated jobs study” released earlier this week. Greene claims the industry’s jobs numbers are “way off” because they use both inflated jobs multipliers and inflated economic impact, creating what he calls “wonky numbers.”
The author of the study, John Urbanchuk of Entrix, provided a detailed defense of his analysis in a comment on Greene’s post.
Defending the job multiplier, Urbanchuk writes, “Mr. Greene accuses me of using “inflated” jobs multipliers and suggests that “… a multiplier of 6 is aggressive. A multiplier of 3-4 is more realistic …” I used the RIMS II final demand employment multipliers for supplying industries calculated by the U.S. Bureau of Economic Analysis.”
Greene also accuses the ethanol industry of “magically creating thousands of corn growing jobs that would have existed anyway,” which Urbanchuk also defends.
“Our analysis estimates the number of jobs in the corn sector supported by ethanol and at risk if the VEETC is eliminated. The loss of 4 billion gallons of ethanol is the equivalent of 1.5 billion bushels of corn, or about 11% of total corn utilization. Mr. Greene assumes that if corn demand is reduced by lower ethanol production, corn growers will continue to plant and produce the same amount of corn regardless. Supply and demand, Mr. Greene … supply will adjust to lower demand … fewer acres and bushels translates to fewer jobs to plant, treat, harvest, transport corn … not to mention to provide all of the ancillary tasks on the farm. Moreover, during the whole international land use change debate the environmental community said if we weren’t growing corn for ethanol, all that land would “revert to nature.” It now appears that the claim is that if we weren’t growing corn for ethanol, we’d be growing the same amount anyway for some other else. In other words and to parody a famous movie “if you grow it, they will buy it”! You can’t have it both ways.”