Looming 'jobs catastrophe' in energy sector

Unite general secretary Sharon Graham has said the debate on soaring energy prices has, until now, ignored ‘the coming jobs crisis’.

During 2021 more than 30 energy firms went bust and with that hundreds of jobs were lost. However, research by Unite suggests that as the energy crisis escalates this year, jobs losses in the sector will rise exponentially.

There has been considerable debate about the continuing rising costs of energy. In 2021 wholesale gas prices rose by 133 per cent and wholesale electricity prices by 111 per cent, according to Ofgem figures.

Unite general secretary Sharon Graham said, “Until now, much has been said about the rising costs of energy and the cost of living crisis that it is going to create for household budgets this year. Rightly so. But to date not much has been said about the jobs catastrophe that is coming with the crisis.”

Unite estimates that in the next six months some leading energy firms are contemplating drastic job cuts combined with additional wage cuts and attacks on terms and conditions, like pension payments.

Graham added, “Our intelligence suggests that if the government does not intervene in the energy crisis then tens of thousands of jobs could go before the summer. We know of one energy provider that is due to announce job cuts in its workforce of 20 per cent. And there are many more lining up behind them.”

In Unite’s analysis there is likely to be what might be called ‘vicious circles’ of crisis. The rise in energy prices is forcing energy companies to the wall with consequent job losses. But high fuel prices also affect big energy consumers like the steel industry, pharmaceuticals, and others. This has led to a domino effect as energy sector price rises affect not just consumers but industry as well, which Unite believes will precipitate a spiralling of tens of thousands of job losses.

“Just how long is the government going to be a spectator in this coming jobs crisis?” Graham went on to say. “We need the government to intervene with a support programme to save jobs for the industry, and we need it now. We refuse to let workers carry the can for a crisis which is not of their making.”

Unite is strongly critical of the total lack of government consultation with trade unions on the crisis to date. Unite believes any support programme for the industry has to be introduced with stringent assessments of business circumstances, including past profits and dividend payments, before any government loans or grants are made.

Today (January 11) Unite’s national committee for the energy sector also called for the introduction of an emergency jobs protection programme, including short-time working schemes on the lines of the German ‘Kuzarbeit’ programme. The Kuzarbeit scheme supports workers who are on a reduced working week by supplementing their wages which allows them to stay in work.

Unite national officer for energy Simon Coop, said, “It is time for a national jobs protection programme to prevent a jobs catastrophe. The UK needs a short-time working scheme like other countries have. Of course, in the long term, the UK must create a balanced energy policy which, includes wind, solar, hydro, gas, clean coal and nuclear to lower energy bills in the future for all. But in this current crisis we need a significant financial package to fund a job protection scheme.”

By Barckley Sumner