This Kentucky coal town is fighting for survival long after the war on coal is over

Hazard, Kentucky.
Photo: Robert Hall | SmoothPhoto
Hazard, Kentucky.

Tony Bowling is 52. He was born, raised and still lives in Hazard, Kentucky, a small town in the southeastern corner of the state, deep in the heart of Appalachia's coal country. Like many of Hazard's roughly 5,300 citizens, he hails from a long line of coal workers. "Every male on both sides of my family, going back at least three generations, worked in the mines," said Bowling, himself an underground miner for more than 10 years.

But like so many miners in Hazard, surrounding Perry County and throughout eastern Kentucky, Bowling was laid off, another victim of the coal industry's steady decline nationwide, especially over the past decade.

"The TECO Coal Corp. mine I worked for completely shut down," he said, recalling identical fates with two other mining companies he'd worked for until being laid off. "I finally said enough is enough."

That was in 2012. Two years later, still looking for a steady job, Bowling signed up for a 10-week training program at Hazard Community and Technical College (HCTC) to earn certification as an electrical lineman. He's been working, aboveground instead of below it ever since — just not in Hazard. His job has taken him to Ohio, Florida, Maine, North Carolina and now to Puerto Rico. "I'm making more money now than I ever did in the mines," he said, adding that he's also an instructor in the program on weekends.

Hazard, Kentucky.
Photo: Robert Hall | SmoothPhoto
Hazard, Kentucky.

Bowling's story is emblematic of the boom-and-bust history of the coal industry in Appalachia, a largely rural 13-state swath that runs from southern New York to northeastern Mississippi. And while he successfully switched careers, thousands of fellow miners in and around Hazard are unemployed, despite numerous job-training initiatives such as HCTC's lineman program.

"We're still dealing with the aftermath of layoffs in the coal industry," said Michael Cornett, director of agency expansion and public relations of the Eastern Kentucky Concentrated Employment Program, a nonprofit, federally funded workforce development organization established in 1968 and headquartered in Hazard. "You don't recover from the loss of 13,000 coal industry jobs [in eastern Kentucky] since 2011 overnight."

Today only seven companies produce coal near Hazard, including Blue Diamond Coal, ICG Hazard and Cumberland River Coal. During the industry's heyday, dozens of companies operated mines in Perry County. In 2008 the region produced 17 million tons of coal annually. It dropped to about 4.1 million tons last year.

Layoffs topped out in 2016, when the state's coal industry slumped to its lowest point in 118 years, according to a report by the Kentucky Energy and Environment Cabinet. The number of jobs statewide dropped by nearly 1,500 during just the first three months of that year, or 17.9 percent, leaving an estimated 6,900 employees in the industry. 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. The last time Kentucky had so few coal jobs was 1898, when they averaged 6,399, the report said.

Today's unemployment rate in eastern Kentucky ranges from 9 percent to 12 percent, said Jared Arnett, executive director of Shaping Our Appalachian Region, a nonprofit agency formed in 2013 as a coordinator for economic development and job creation resources in eastern Kentucky. "But the real number that speaks more to the problem is the labor participation rate," he stated. "We run at about 44 percent, while the national average is 70 percent. That's the crux of the challenge."

Fallout from the war on coal

It's no secret that the U.S. coal industry has been struggling for years. Industry advocates often blame the Obama administration's "war on coal," specifically two signature policies to reduce fossil fuels' carbon emissions — the Clean Power Plan, which never went into effect before the Trump administration moved to eliminate it altogether, and the Paris Climate Agreement, from which the United States has withdrawn.

A majority of economists, business and energy analysts instead agree that coal's demise is due to a triple whammy: competition from much cheaper and cleaner-burning natural gas, proliferated by fracking technology; growth in the solar and wind energy production; and tougher environmental regulations. In Appalachia coal production fell by nearly 45 percent overall between 2005 and 2015, according to a recent analysis by the Appalachian Regional Commission, an economic development agency established by Congress in 1965. As a result, since 2011 the entire region has lost about 33,500 mining jobs.

"We're still dealing with the aftermath of layoffs in the coal industry.  You don't recover from the loss of 13,000 coal industry jobs [in eastern Kentucky] since 2011 overnight." -Michael Cornett, director of agency expansion and public relations for the Eastern Kentucky Concentrated Employment Program

Hardest hit has been eastern Kentucky, which has endured the highs and lows of the coal marketplace for more than 100 years. Times were best when mining wide veins of high-sulfur, bituminous coal close to the surface was cheap and demand was high, and worst once miners had to dig deeper and demand dropped. Literally the fuel of America's Industrial Revolution and growth, coal has fallen from providing more than half of the nation's electricity as recently as 2000 to 30 percent in 2017.

An old coal processing plant in Hazard, Kentucky.
Photo: Robert Hall | SmoothPhoto
An old coal processing plant in Hazard, Kentucky.

"Coal is only viable to extract when the price is very high," said Chris Bollinger, an economics professor and director of the Center for Business and Economics at the University of Kentucky, which recently published the 2018 Kentucky Annual Economic Report. "It's not now and hasn't been for a while, and it isn't likely to recover." Plus, he noted, because coal from western states, including Wyoming — by far the nation's top coal producer — is considerably cheaper than Appalachia's, "even if there's a big resurgence in demand, it's not likely to be for Kentucky coal."

At the same time eastern Kentucky is striving to employ out-of-work miners through a mix of local, state, federal and private programs, communities are dealing with endemic poverty, opioid abuse, aging infrastructure, environmental issues and a deficient K–12 education system. Other single-industry areas, such as Detroit and Pittsburgh with their auto and steel industries, respectively, have fallen on hard times. But whereas those cities generally rebounded, Hazard continues to whirl in an imperfect storm of circumstances, both natural and man-made.

Although jobs are in precious demand, a deep-rooted spirit of resilience abounds. "There is still a lot of hope in the region," said Jennifer Lindon, president of the Hazard Community and Technical College, one of several entities tasked with not only developing a non-coal workforce but also attracting other businesses and launching whole new industries. She grew up in Hazard and returned after earning a Ph.D. at Mississippi State University, so she shares the local pride and heritage surrounding coal. "We had bumper stickers that said, 'Coal Is King.' I am not against coal."

Yet Lindon also acknowledged the deleterious impacts of that legacy. "We knew we needed to diversify our economy," she said, "but for whatever reasons we did not."

Trying to reinvent the workforce

The human toll is high unemployment coupled with a lack of opportunity for jobs nearby, although several manufacturers are planning new facilities within a couple hours drive from Hazard. Briady Industries, near Ashland, aims to open a state-subsidized $1.3 billion aluminum rolling mill by 2020, with the promise of more than 550 jobs. Silver Liner has said it will employ 50 people to assemble tanker trucks in Pikeville when its operations begin later this year. Last December, EnerBlu, a California-based advanced battery maker, announced plans to erect a $412-million gigafactory in Pikeville — on the site of a shuttered coal mine — slated to launch in 2020 and employ up to 875 workers.

In the meantime, HCTC offers training programs designed to put unemployed miners back to work right away. The most successful has been the lineman course Bowling completed. "We've trained around 186 people, mostly miners, in the program," Lindon reported, "and we have a 90 percent placement rate."

There's a hitch, however. Most of those jobs are out of town, requiring linemen to be on the road during the week and travel home on weekends. Some jobs are even more demanding. Bowling, for instance, spoke to CNBC.com by phone from Puerto Rico, where he's working for 120 days helping to repair the electrical system hit by Hurricane Maria.

HCTC has had to reconsider some of its workforce curriculum, recognizing a catch-22 that frustrates many community and technical colleges. "Should I train 100 people in advanced manufacturing when I don't have a manufacturer in my area?" she said. "Or if I train them, does that mean [Hazard] will be more attractive to industry?"

Further complicating matters is that many miners, particularly older ones, lack college degrees, an unintended consequence for decades of landing good-paying mining jobs right out of high school. That excludes them from transitioning to careers that require high-level STEM degrees, so HCTC's automotive, welding and HVAC certificate courses are popular.

Another persistent obstacle, said Cornett, ties back to Hazard's coal culture. "From an outsider's perspective, it's a dirty, dangerous job, and how can anyone do it? From here, though, mining is not just a vocation, but an avocation," he explained. "There's a sense of pride and purpose, and nothing to be ashamed of. To see the industry downturn tears at the cultural roots of how people perceive themselves and where they live, because it pulls the rug out from underneath you."

More from @Work:

The hot job market for workers over 50
Silicon Valley reeling as Trump chokes a source of tech talent

The challenge, Cornett said, is to get miners to see themselves in a different light, and to reimagine how to take the skills they have and apply them to another occupation. Heavy-equipment operators, truck drivers, mechanics and engineers from the coal industry may be able use their know-how in a variety of businesses, including the fledgling drone industry that's emerging in Hazard. "We're trying to get the region as a whole to see itself not as it was, but what it can become."

Tech challenges abound

The region's remoteness and mountainous geography have curtailed installation of broadband internet, creating a vexing impediment for a host of work options, as well as preventing companies from moving here. That's why SOAR has made building out a high-speed network a top priority among its partners.

For example, broadband is essential to EKCEP's Teleworks USA initiative, which prepares people for remote call-center work with companies located almost anywhere, either from home or one of eight wired hubs set up around the area. "Since January 2015, we've placed about 1,400 eastern Kentuckians in such jobs," Cornett said. Training takes two weeks, and starting pay is $10 an hour; the newfound income has infused $30 million into the local economy, he added.

Computer coding schools across the country have been touted as a quick way for those without college degrees to get high-paying jobs, but only if they're available. When a couple of former coal workers launched Bit Source, a software and web developer, in Pikeville in 2015, there was buzz about the region becoming "Silicon Holler." The company hired 10 former miners as coders, trained through a EKCEP program called TechHire East Kentucky — from among 900 applicants.

"We want to connect with employers who have real job opportunities that we can train people to fill," said Arnett of such conundrums. "We're finished with the 'train and pray' approach. So we're building relationships with outside companies that will hire people from our region to work in our region."

Make no mistake, though, there are still hundreds of coal miners working in Hazard and Perry County, including nearly 200 for Cambrian Coal Group, part of Booth Energy in Debord, Kentucky. "About 75 percent of what's produced in Hazard is thermal coal," said Cambrian president Mark Campbell, which is used in power plants, a dwindling market. Cambrian's mines are also a source for metallurgical coal, an essential ingredient in steel manufacturing, a sector expected to benefit from President Trump's recent 25 percent tariff on imported steel. "We're optimistic that will create demand for our [metallurgical] coal," Campbell said, but it's too soon to predict if it will translate into new jobs.

What all this portends for the future of Hazard remains to be seen, though there's little doubt that King Coal's absolute reign is over. The consensus seems to be that the industry — and the culture it's engendered — are too entrenched to completely disappear, nor will coal mining jobs, but certainly not enough to sustain the community. There's widespread hope, too, that the many efforts to retrain former miner workers and to prepare the next generation for a variety of different careers will lead to the town's survival.

"Everybody realizes that nothing we do can change where the coal industry stands," Arnett said. "I have neighbors and friends in the industry, and some still have jobs. But they also see their children and grandchildren leaving, and realize that other options are not a bad thing."

— By Bob Woods, special to CNBC.com