Contrary to early predictions, U.S. auto plants producing electric vehicles (EVs) have needed more workers than those making traditional gas-powered cars. A study from the University of Michigan shows that during the shift to large-scale EV production, the number of assembly jobs at some plants grew by as much as 10 times. At one factory with over a decade of EV production, it still takes three times as many workers to build an EV as it did to build a car with an internal combustion engine (ICE).
“There’s a lack of data on how the EV transition is actually playing out,” say the researchers. “But the idea that EVs would lead to job losses isn’t backed up by the evidence so far.”
Fewer jobs
Previous estimates had warned that EV manufacturing would cut auto industry jobs by 30% to 40%, or over 200,000 jobs, because EVs have simpler designs. Unlike traditional cars, EVs don’t have exhaust systems, transmissions, or as many cooling parts, so many expected fewer workers would be needed. But the new findings suggest otherwise.
Several factors may explain the increased demand for assembly workers at EV plants:
- Investing in new manufacturing technologies often requires extra labor to get things running efficiently.
- EV makers tend to start with complex, high-end models that require more intricate assembly.
- Some companies are centralizing production in-house to cut outsourcing costs, a practice known as vertical integration.
The widely circulated figure of a 30% job loss can be traced back to a 2017 forecast by James Hackett, Ford’s former CEO. “It’s a number that gets repeated a lot,” the authors note, “but no one had really looked at actual factories that have switched from ICE to EV production.”
Making the transition
The study focused on three factories that transitioned to EV manufacturing: Tesla’s Fremont plant in California, Rivian’s factory in Illinois, and GM’s Orion Township plant in Michigan. Using 20 years of data, the researchers tracked the number of assembly workers and found that in many cases, the workforce had grown.
However, they caution that the impact on parts manufacturing jobs, especially for battery cells, is still uncertain and depends on where those parts are made.
Tesla’s Fremont factory offers the longest track record of EV production. The researchers believe it shows how slowly labor efficiency improves. “After ten years, they’ve gotten better at reducing labor costs, but the data suggests it could take up to 15 years for an EV plant to match the efficiency of an ICE plant,” they conclude.
“This is going to be a gradual process, giving time for communities, companies, and workers to adapt.”
