refineries

By Virginia Parks, PhD and Ian Baran - UC Labor Center, April 26, 2023

On October 30, 2020, the Marathon oil refinery in Contra Costa County, California, was permanently shut down and 345 unionized workers laid off. We surveyed (n=140) and interviewed (n=21) these refinery workers to document their post-layoff employment experiences. The findings in this report focus on these workers’ post-layoff job search, employment status, wages, and financial security. The Marathon refinery’s closure sheds light on the employment and economic impacts of climate change policies and a shrinking fossil fuel industry on fossil fuel workers in the region and more broadly.

In the aftermath of the refinery shutdown, workers were relatively successful in gaining post-layoff employment but at the cost of lower wages and worse working conditions. At the time of the survey, 74% of former Marathon workers (excluding retirees) had found new jobs. Nearly one in five (19%) were not employed but actively searching for work; 4% were not employed but not looking for a job; and the remaining 2% were temporarily laid off from their current job. Using standard labor statistics measures, the post-layoff unemployment rate among Marathon workers was 22.5% and the employment rate was 77.5%. If workers who have stopped actively searching for work were included, the post-layoff unemployment rate was higher at 26%.

Former Marathon workers find themselves in jobs that pay $12 per hour less than their Marathon jobs, a 24% cut in pay. The median hourly wage at Marathon was $50, compared to a post-layoff median of $38. A striking level of wage inequality defines the post-layoff wages of former refinery workers. At Marathon, hourly pay ranged between $30 to $68. The current range extends as low as $14 per hour to a high of $69. Workers reported benefits packages comparable to their pre-layoff Marathon benefits.

Workers found jobs in a range of sectors. The single most common sector of re-employment was oil and gas, where 28% of former Marathon workers found post-layoff jobs but at wages 26% lower than at Marathon. These lower rates of pay stem from loss of seniority and non-union employment. The utility sector (electrical power, natural gas, wastewater management) was the second most common sector of re-employment. Workers reported that utility jobs were a good fit for their skills, reputed as “good jobs,” and highly sought after. The median hourly utility wage was $41. The third most common re-employment sector was chemical treatment. Less than half (43%) of all post-layoff jobs were unionized.

Overall, workers reported worse working conditions at their post-layoff jobs, even in higher wage jobs. Workers described hazardous worksites, heavy workloads, work speed-up, increased job responsibilities, and few opportunities for advancement. Above all, workers cited poor safety practices and increased worksite hazards as the most significant and alarming characteristics of degraded working conditions.

Workers had difficulty finding jobs that matched their skills when searching for work. They emphasized two primary frustrations: 1) employers’ lack of knowledge about refinery work and refinery workers’ skills and 2) workers’ inability to prove their skill or experience through certifications or a verification process.

Nearly all workers (91%) would consider job training. Approximately half (49%) said they would enroll in a job training program, 42% responded “maybe,” and 9% said they would not. Workers aged 40 to 49 reported the greatest willingness to enroll in training followed by workers aged 30 to 39. Hesitation was highest among workers over the age of 50. Workers’ most prevalent concerns about training were cost, needing to earn while training, and training program length. Many workers were apprehensive about the efficacy of training. Workers were uniformly uninterested in going back to school to earn degrees.

Workers reported increasing financial insecurity after the layoff. A full third of all workers described that they were “falling behind financially” a year following the layoff compared to only 3% before the layoff. Nearly one-third of all workers took early withdrawals from their retirement accounts to make ends meet following layoff. Most re-employed workers did not move to find jobs, likely associated with the high rate of home ownership among Marathon workers (81%). Many expressed deep anxieties about their long-term ability to make mortgage payments.

Laid-off workers are highly motivated to put their skills and experience to use in new jobs, in new sectors. They require coordinated assistance to transition successfully into new jobs and for the region to retain them. Our research findings identify four critical types of assistance that workers need most. First, third-party skill certification would facilitate more efficient and accurate skill matching between jobs and workers in the labor market. Certification would help workers communicate, and verify, their skills to new employers. Certification would aid employers who are unfamiliar with the refinery sector make better decisions about assessing their workforce needs in relation to the skills of former refinery workers.

Second, workers require targeted job search assistance that focuses on a broad scope of strategies, including effective job search techniques, resume and online profile preparation, and career counseling. Both workers and job counselors require an up-to-date and nuanced assessment of jobs and industries to which refinery skills transfer.

Third, a fair and equitable transition for workers out of the fossil fuel sector depends upon a robust economic development strategy that generates new jobs comparable in quality to the jobs these workers are leaving behind. Successful transition requires both transition assistance and high-road job growth. One without the other will leave workers, and the region, behind.

Lastly, regional economic development strategies aimed at reducing fossil fuel dependency must account for the adverse financial impact these strategies will have on workers and their families. Loss of income will invariably result. A just transition for working Californians needs to include financial support, in the form of cash assistance or wage replacement, to cover losses in wage income.

Download a copy of this publication here (PDF).

By Annie Lowrey - The Atlantic, April 26, 2023

In 2006, James Feldermann got hired as a trainee at a refinery in Martinez, California, in the Bay Area. It was hard work, with 12-hour-minimum shifts, but Feldermann came to excel at it. He learned how to isolate pipes and vessels, load railcars with molten sulfur and ammonia, and helm an industrial control panel. In time, he rose to the position of head operator at the Marathon Petroleum site. The job paid well, and he enjoyed it. He expected to stay until retirement.

On a Friday afternoon in July 2020, Feldermann was abruptly summoned to an all-hands Zoom meeting. While some of his colleagues struggled to get the audio to work, Feldermann received a phone call from his union representative. “I didn’t actually hear management tell us that they were laying us off,” he told me. The plant was being shut down, as the rise of work-from-home and the spread of electric vehicles depressed Californians’ demand for gasoline. Feldermann and his co-workers would be out of a job in 90 days.

The United States is embarking on an epochal transition from fossil fuels to green energy. That shift is necessary to avert the worst outcomes of climate change. It also stands to put hundreds of thousands, perhaps millions, of people like Feldermann out of work. The result could be not only economic pain for individual families, but also the devastation of communities that rely on fossil-fuel extraction and a powerful political backlash against green-energy policies.

A pathbreaking new study shows just how real the damage could be, absent policies to soften the economic blow. Virginia Parks, a professor at UC Irvine, and Ian Baran, a doctoral student, tracked the consequences of the Marathon shutdown in near-real time, getting more than 40 percent of the workers to return surveys and a smaller group to sit for interviews. They found that, more than a year after the shutdown, one in five Marathon workers was unemployed. Their earnings had declined sharply, with the median hourly wage of employed workers plunging from $50 to $38. Some workers were earning as little as $14 an hour. And those new gigs came with more dangerous working conditions.

To prevent other workers from experiencing the same, the Biden White House has promised to pursue a “just transition,” employing policies to ensure “new, good-paying jobs for American workers and health and economic benefits for communities.” But the green-energy transition is already underway. And it is not clear that it will be just.

By Tanya Stasio, PhD, Sachin Peddada, Elisabeth Seliga, Jordan Burt, and Liz Stanton, PhD - Applied Economics Clinic, March 20, 2023

On behalf of the Indigenous Peoples of the Coastal Bend (IPCB), this Applied Economics Clinic (AEC) report summarizes the economic impact of the petroleum industry in Nueces County, Texas and the negative impacts of the polluting facilities located in the City of Corpus Christi and its “Refinery Row” district. While major petroleum companies have promised economic benefits, Corpus Christi's petroleum refineries employ less than 2 percent of the City's workforce. In the absence of more stringent reporting requirements and enforcement actions, Refinery Row releases high levels of harmful pollutants with minor consequences while nearby neighborhoods suffer higher rates of asthma and cancer prevalence rates than other areas in Corpus Christi. 

This report was funded through AEC's Pro Bono Fund, which provides pro bono analysis, research, testimony, policy briefs, or detailed reports to Environmental Justice groups on topics including energy economics, climate and other environmental impacts, and diversity, equity, and inclusion analysis.

Download a copy of this publication here (PDF).

By Christina E. Simeone, PhD - Union of Concerned Scientists, March 2023

Following the explosion of a Philadelphia oil refinery, the refinery went bankrupt and closed.

The explosion and closure left community members grappling with toxic pollution, cleanup, worker dislocation, and an uncertain future for a site that occupied 1,300 acres just 2.5 miles from center city Philadelphia.

In a report commissioned by the Union of Concerned Scientists, Dr. Christina Simeone, author of the Penn Energy Center report, Beyond Bankruptcy: The Outlook for Philadelphia’s Neighborhood Refinery, highlights key findings and shares lessons learned from the events in Philadelphia.

These lessons can help policymakers and other refinery communities prepare for future refinery closures, especially as the transition to electric vehicles inevitably leads to dramatic reductions in demand for gasoline and diesel in the coming decades.

Download a copy of this publication here (link).

By Ted Goldberg - KQED, February 5, 2023

Chevron has fired five workers who went on strike at the oil giant’s Richmond refinery last spring, according to their union. The apparent termination of United Steelworkers Local 5 employees at one of the West Coast’s major oil refining facilities prompted the union to file complaints with federal labor regulators.

The workers Chevron fired — two during the walkout and three in the months that followed — were mostly safety operators at the refinery who played leadership roles in the strike, according to union president Tracy Scott.

The firings “were unjust,” Scott said.

One of those fired was B.K. White, a top union negotiator who became the face of the labor action and had worked at the refinery for nearly three decades.

“You could just tell it was retaliatory or punitive in nature,” said White, vice president of USW Local 5. “It appears there’s a concerted effort to break the union.”

In a complaint filed with the National Labor Relations Board, the union alleges that Chevron ordered its members to train contractors to do union-covered work and then punished them for their labor activities. The NLRB has deferred action on the Local 5's unfair labor practice charges pending arbitration of a grievance the union had already filed with the company.

News of the firings comes months after a 10-week-long strike by hundreds of USW workers. It was the first walkout at Chevron’s Richmond refinery in 40 years.

The marathon labor action ended up delivering only modest gains to workers. The contract, approved by a slim majority of union members, gave a small bump in pay and medical benefits to refinery employees who went without paychecks for more than two months.

By Julia Conley - Common Dreams, January 3, 2023

New analysis shows how California "can achieve a just and equitable transition away from fossil fuels for oil and gas workers."

A new analysis out Tuesday shows how a just transition towards a green economy in California—one in which workers in the state's fossil fuel industry would be able to find new employment and receive assistance if they're displaced from their jobs—will be "both affordable and achievable," contrary to claims from oil and gas giants and anti-climate lawmakers.

The study published by the Gender Equity Policy Institute (GEPI) notes that a majority of workers in the oil and gas sectors will have numerous new job opportunities as California pushes to become carbon neutral by 2045 with a vow to construct a 100% clean electricity grid and massively reduce oil consumption and production.

"The state will need to modernize its electrical grid and build storage capacity to meet increased demand for electricity," reads the report. "Carbon management techniques, plugging orphan wells, and the development of new energy sources such as geothermal will all come into play, providing economic opportunities to workers and businesses alike."

GEPI analyzed the most recent public labor data, showing that the oil and gas industries in California employed approximately 59,200 people as of 2021 across jobs in production, sales, transportation, legal, and executive departments, among others.

The group examined potential job opportunities for fossil fuel workers "in all growing occupations, not solely in clean energy or green jobs," and found that about two-thirds of employees are likely to find promising opportunities outside of fossil fuel-related work.

"Our findings show that a sizable majority (56%) of current oil and gas workers are highly likely to find jobs in California in another industry in their current occupation, given demand in the broader California economy for workers with their existing skills," the report says.

By Steve Morse - Labor Rise for Climate, Jobs, Justice, and Peace, November 2022

We who work and have worked with our hands, bodies and minds to build, manufacture and repair are committed to our own well-being and that of our families. Our unions have often fought successfully toward this goal, delivering on wages and pensions.

It’s time to face another commitment we owe our families and the next generation: to work for a healthy planet and for justice.

The Climate Crisis is now. We know about the melting glaciers, rising sea levels, droughts, floods, heat waves, fires and hurricanes. Youth, including our own children and grandchildren, are ready to fight for a livable planet, and many are already doing so. Our unions must stand with them.

By Neil Rothnie, Vivian Price and Gabrielle Zeliazkov - Global Climate Jobs, September 16, 2022

By Marisol Cantú, Micheal Hayes, and staff - Richmond Progressive Alliance, May 16, 2022

Flaring at the Richmond Lubrications Oil Plant. April 14, 2-4 pm.

United Steelworkers (USW) Local 5 workers have been on strike at Richmond's Chevron Refinery since March 21, 2022. Since then, workers and community members have carefully documented flaring events at the refinery, which is currently run by strikebreakers who do not have the necessary training to safely operate the equipment. Below are three important documents of this extremely unsafe situation: a) a letter addressed to the Bay Area Air Quality Management District (BAAQMD) by organizer Marisol Cantú, articulating the current risks to our surrounding community and demands of relevant inspection agencies; b) a photographic gallery of flaring events taken during the strike by workers and community observers; and c) a letter authored by a USW Local 5 refinery worker, describing the extensive training he and his colleagues receive that is necessary to keep the community safe (and that current employees operating the plant do not have).