Alpha layoffs add to the more than 2,500 WV coal jobs lost this year
September 19, 2012 ·
Some labor analysts think this could just be the beginning.
America’s second largest coal company, Alpha Natural Resources, released a strategic repositioning plan Tuesday. With it, the company plans to shed 1200 jobs over the next few months.
It started by idling 8 mines; four of in West Virginia including Alloy deep and Alloy surface both in Fayette County, Premium highwall mine in Mingo County and White Flame surface mine also in Mingo County. Three closed in Virginia, while one shut down in Pennsylvania. Alpha offered 270 of the 400 workers who got pinks slips Tuesday, jobs at other locations.
Alpha's Samantha Davison says miners, along with supervisors and employees in every area of the company will be affected.
“These changes are impacting everyone on every level at the operation," Davison said, "at corporate executive level as well and we will announce who and when and where and all that as we go forward but these changes are going to take place starting now through early 2013.”
“We are strengthening our met portfolio and our leadership in the global markets. We are creating and focused and profitable thermal business and closing mines that lose Alpha money.”
Some of the mines were owned by Massey Energy at one time but Davison insists the former ownership had nothing to do with the closures.
Davison says Alpha blames a mild winter, stricter regulations from the Environmental Protection Agency, and increased competition for the cutbacks.
“The outlook for thermal coal in the US has dramatically changed," she said. "A substantial number of electric utilities have switched from coal to cheap natural gas. And coal fired plants are either being closed or not being built because of the new regulations.”
Alpha is focusing on production of metallurgical coal, which is used in steel production.
Demand for that coal in the global market is steady.
Ted Boettneer, analyzed the impact on coal jobs in West Virginia. He’s the Executive Director of the West Virginia Center on Budget and Policy.
Part of the report, “The State of Working in West Virginia, In Depth: The Gas Boom and Coal Bust,” analyzes the influence of competitive energy sources such as gas, on coal production. Boettneer says market forces like cheaper natural gas and Western Coal, is partially to blame for the state’s diminshing coal economy.
Before the Alpha announcement, West Virginia lost 2500 coal jobs in 2012.
Boettner says about 90 percent of the jobs in the industry don’t require college degrees.
“If the decline in production results in a decline in employment," Boettner explained, "it’s going to be more and more important for people to have that associates degree and to have that college degree in order to compete and in order for them to find further employment.”
Less than 24 percent of the the state's workforce has a bachelor's degree or higher. West Virginia generally has lower levels of education in the workforce compared to the rest of the nation.
“If there’s one thing that a business looks for when it’s looking to locate in a state," he said, "well do they have an educated workforce that can do the job that we need and in West Virginia that’s the biggest impediment to economic growth that there is.”
The Energy Information Administration projections are particularly grim for southern West Virginia, although the northern part of the state is expected to fare better. Based on recent analysis of the EIA, trends in decreased production may require increases in employment, which would likely translate to higher production costs of West Virginia coal.
Boettner hopes to see the state be proactive and form some sort of task force to prepare for the shift.
“I think it’s really important that we get folks together to look at these declining coal production estimates," he said, "and we figure out a plan to deal with it and my concern right now is no one is doing that.”
In addition to competition from natural gas Boettneer says West Virginia coal production is declining as more coal seems are depleted. He says new regulations from the EPA are not the most relevant factor.