Vaios Triantafyllou

In this paper, I study the impact of the German policy to phase out coal-fired power generation on local labor markets. Utilizing confidential employer–employee matched microdata, I compare workers in the supply chain of coal to ones in other industries, before and after the introduction of the legislation. I find a 4.2% decline in average daily wages, mainly affecting those employed in upstream economic activities. Workers separating from their firms experienced a 5% reduction, while ones staying saw a decline of 1.1%, recovering within four years. Leavers remained in the same industries, proceeding to work in greener firms, while stayers downgraded and switched occupations. I provide evidence that the pickup in renewable installations partially mitigated the potential employment effects.