What Will the Impact of Hinkley Point C be on the Job Economy?

Whether you’re for or against the construction of the nuclear power plant Hinkley Point C, one fact is undeniable: it will temporarily create an enormous amount of jobs.

By Sam Smith, Global Vice President, Life Sciences & Healthcare  |  December 20, 2016

Whether you’re for or against the U.K.’s recent decision to green light the construction of the nuclear power plant Hinkley Point C, one fact is undeniable: it will temporarily create an enormous amount of jobs. EDF Energy, the French energy company driving the project, states in its blog post “Why Hinkley Point C is good news for the economy” that the construction and operation of the plant will create approximately 25,000 jobs. During its projected 60-year lifetime, the plant itself will create another 900 positions.

As New York Times writer Stephen Castle points out in “Hinkley Point Nuclear Plant Will Go Ahead, Britain Says,” the £16 billion deal goes a long way to strengthening the relationship with China, which is financing over 33 percent of the plant. Especially in the general economic insecurity in post-Brexit Britain, China is an important trade partner. In addition, the deal paves the way for more collaboration between the U.K. and France in terms of energy and industry. Moreover, the plant will produce approximately seven percent of the U.K’s total electricity needs. Considering that according to Good Energy, almost 60 percent of the U.K.’s energy is imported from Russia, Norway, and Kazakhstan, the more energy that can be produced domestically, the better.

Yet despite all of the positive implications of this project, it’s important to look at the long-term local economic and social impacts of Hinkley Point C. And to do this, it’s critical to study the consequences of similar large-scale construction projects.

According to Roger Vickerman in “Transport and Urban Development,” at the start of construction on the Channel Tunnel, local unemployment rates in Kent dropped dramatically. They went from 11.4 percent in Dover in 1986 to 5.1 percent in 1990. However, because the completion of construction coincided with an economic recession, the effects of the massive layoffs were compounded by the U.K.’s general malaise at the time. By December 1993, unemployment in Dover had again risen to 10.4 percent.

This same pattern can be seen over and over again across the globe. Think of the recent oil boom—and bust—in the United States (North Dakota). Important opportunities initially attract thousands of workers; which in turn creates more jobs in housing construction, infrastructure, and supporting services. But when the project is completed, workers are laid off, unemployment spikes sharply—and if left unaddressed, it results in increased poverty, crime, and eventually, urban blight.

The two towns closest to Hinkley Point, Bridgewater and Burnham-on-Sea, have approximately 60,850 inhabitants combined. While Bridgewater is a manufacturing hub, the surrounding area relies heavily on tourism. Now imagine what happens when 25,000 workers and their families all move to the area. They’ll need homes, retail, services, healthcare, education—all of which will attract even more people. And while EDF Energy is investing £14 million in local training and education, creating 1,000 apprenticeships, and investing another £50 million in further community development, without another major job generating development in the area, the initial upswing in the economy will quickly head south again.

Clearly, these types of large-scale projects have proven to be highly disruptive for local economies in the past. However, when you examine the current situation from a workforce solutions point of view, the rise of the gig economy offers a significant opportunity to avoid the dreaded bust-boom scenario. Because while there’s an irrefutable need for construction workers and other hands-on talent to be on-site, there are many parts that can be done remotely, from software and systems design to training and HR.

By creating a workforce strategy that makes use of geographically dispersed talent—whether it’s BPO, SOW labour, contractors, contingent workers, or freelancers—where possible, EDF Energy and the other companies involved in this project can demonstrate their social responsibility while simultaneously spreading the economic benefits over a wider geography. And that in turn will help enhance their employer brand over the long term.

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