Coal jobs in Kentucky fall to lowest level in 118 years

Laid-off miner Michael Preston of Floyd Countywent back to school to get a two-year degree in electrical technology.
Laid-off miner Michael Preston of Floyd Countywent back to school to get a two-year degree in electrical technology. Big Sandy Community & Technical College

Kentucky’s coal industry continued to hemorrhage jobs in the first three months of 2016, hitting the lowest total in 118 years, according to a report released Monday.

The number of jobs dropped by a little more than 1,500 during the quarter, or 17.9 percent, leaving estimated employment in the industry of 6,900 as of April 1, according to the report by the Kentucky Energy and Environment Cabinet.

The last time the state had so few coal jobs was 1898, when coal employment averaged 6,399, the report said.

Eastern Kentucky lost 21.6 percent of its coal jobs during the quarter, while the drop in the state’s western coalfield was 12.2 percent.

More than half the coal jobs in Eastern Kentucky have disappeared in recent years.

The plunge has decimated an industry that historically underpinned the regional economy, spreading the effects of the downturn.

6,900 The number of coal jobs in Kentucky as of April 1.

“Businesses are suffering. People just ain’t got the money to spend like they used to,” said Michael Preston of Floyd County, who lost his job as a driller at a surface mine in August 2014 after 16 years in the industry.

Preston, 38, returned to school at Big Sandy Community & Technical College with the help of job-training programs through the Eastern Kentucky Concentrated Employment Program.

He said he will graduate soon with a two-year degree in electronic technology, giving him a number of job options.

But Preston said he knows laid-off miners who have lost their vehicles and homes because there are few jobs to replace the $60,000 or $70,000 they once made.

“They’re just doing what they can to make it,” he said.

Some local governments in the region have laid off staff and cut services to deal with the downturn in tax revenue from coal, and schools are grappling with having fewer students and less money as families move away for work.

Production numbers were equally bleak in the first three months of the year. Statewide, companies mined 12.8 percent less coal.

The rate of production statewide in 2016 is the lowest since 1939, according to the report. In Eastern Kentucky, however, where quarterly production fell 21.6 percent, the production rate is the lowest since 1917.

That was near the end of a decade when the construction of railroads opened the way for explosive growth in the coal industry in Eastern Kentucky, with companies building wholly owned towns such as Lynch, Wheelwright and Jenkins for the workers needed to run their mines.

In Harlan County, for instance, the population tripled from 1910 to 1920, according to Miners, Millhands and Mountaineers, former University of Kentucky professor Ron Eller’s account of the industrialization of the Appalachian South.

Coal production in the county built rapidly, hitting 15 million tons in 1929. It has not equaled that level in more than 20 years, according to the Kentucky Geological Survey.

This year, the county would produce 3.25 million tons at the first-quarter rate.

Coal production has dropped 5.7 percent in Western Kentucky this year.

However, Monday’s report did not include the announced closing of Armstrong’s Parkway Mine in Muhlenberg County, where 122 people worked in March.

The news was not all bad in Western Kentucky. Production in Union County, the state’s top producer, rose 3.6 percent in the quarter.

In Eastern Kentucky, preliminary numbers show that Perry County edged out Pike County as the region’s biggest coal producer in early 2016 for the first time in decades, according to the report.

89% The decline in coal production in Pike County from its peak in 1996.

Pike County was the state’s top producer from 1978 through 2011, but it was displaced in 2012 by Union County.

Production in Pike County is now down 89 percent from its peak in 1996, the report said.

Federal analysts do not project a turnaround in production from the central Appalachian region that includes Eastern Kentucky.

The coal industry blames the downturn on federal environmental rules that have played a key role in utilities closing coal-fired power plants and not building new ones.

“With 262 days left in the Obama presidency, it is all the more critical that the next occupant of the White House have a more positive opinion of coal and its use to power this country’s economy,” said Bill Bissett, president of the Kentucky Coal Association.

Analysts say a number of factors have combined to drive down demand for coal, including competition for power-plant customers from cheap natural gas; tougher federal rules to protect air and water quality, which create an advantage for cleaner-burning gas over coal; and the growth of renewable energy sources such as solar and wind power.

From 2007 through 2015, nationwide consumption of steam coal to make electricity dropped 29 percent, according to the U.S. Energy Information Administration.

Eastern Kentucky also faces particular challenges because many of the thickest seams have been mined out, creating higher costs to mine what’s left.

“The cheap coal has been taken out of the ground,” said Elias Johnson, a coal analyst for the Energy Information Administration.

Decisions by utilities to close coal-fired power plants for environmental and business reasons has undermined the market for coal, and there is more coming on that front for Kentucky’s mines.

About 85 percent of the coal mined in Kentucky in 2015 went to power plants, mostly in the Southeast, according to the report released Monday. Of that total, 13 percent went to plants scheduled to be closed by 2019. Much of that impact will come this year and next.

“Between now and 2017, there is continued downward pressure as more coal-fired power plants retire,” said Aron Patrick, an assistant director who analyzes coal production, employment, and markets for the Energy and Environment Cabinet.