The recent comment by UK Prime Minister Boris Johnson that the energy transition “is not all about some expensive, politically correct, green act of bunny hugging [but] about growth and jobs” was roundly mocked on social media, but ultimately this is how climate action is now sold by policymakers, business leaders and most environmental campaigners alike. However, the widespread assumption that ‘green’ jobs are synonymous with ‘good’ jobs is not borne out. If this is to become the case, companies need to ensure they comply with the social and environmental parts of ESG reporting.
The first difficulty is defining a ‘green job’. The International Labour Organisation (ILO) describes them as “decent jobs that contribute to preserve or restore the environment, be they in traditional sectors such as manufacturing and construction, or in new, emerging green sectors such as renewable energy and energy efficiency”.
Mike Berners-Lee in his book There Is No Planet B says a job is a good thing “when it is useful, fulfilling and appropriately paid”. He adds: “Treating the total number of jobs as a measure of success is not useful because slaves or near slaves would count while many people with purposeful, positive lives would not… Clearly the simple metrics of jobs and employment levels are unhelpful.”
There is increasing concern that many jobs in this new economy are far from ‘decent’ and would not meet Berners-Lee’s description of being “a good thing”, and if the world is to slash emissions in line with Paris Agreement commitments and meet biodiversity protection targets virtually every job will have to contribute, or at least not act in opposition, to the ILO’s goals.
In Europe, the European Green Deal and Covid recovery packages are at the heart of defining priority areas for green jobs, as is the UK’s plan for a green industrial revolution. Research by CLG Europe, part of the Cambridge Institute for Sustainability Leadership, examines how green recovery spending can help stem the Covid-induced jobs haemorrhage in Europe and the UK. The green recovery spending is directed to energy efficiency improvements in buildings, boosting the uptake of renewable energy technologies, accelerating electricity grid improvements, electric vehicles (EVs) and tree planting.
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An EU green recovery plan aimed at boosting economic activity and reducing CO2 emissions could save up to 2.3 million jobs, 1.3 times more than a return-to-normal stimulus plan based on solely reducing VAT rates to encourage households to resume spending, concludes the report. At a national level, this figure would translate into job savings of 626,000 positions in Germany, 131,000 in Poland and 400,000 in Spain.
Biggest job creators
The renewables industry will be a leading source of green jobs worldwide, with the sector employing an estimated 11.5 million people last year, shows data from the International Renewable Energy Agency. A post-Covid-19 agenda focused on decarbonising energy systems would create 5.5 million transition-related jobs over the next three years. Such an approach would bring renewables jobs to nearly 30 million globally by 2030 and pave the way for “longer-term resilience, development and equality”, forecasts the agency.
Car scrappage schemes, where households are offered a subsidy to scrap old internal combustion engine vehicles in favour of new EVs, will have the biggest potential employment and economic impact in Europe in the next two years, finds the CLG.
However, many jobs supported by green recovery spending are unlikely to continue once this funding dries up, “unless short-term subsidies accelerate the adoption of low-carbon technologies, such as solar panels or EVs, making these the new normal”, says Sanna Markkanen, author of the CLG report. “Retrofitting jobs paid for under recovery plans without long-term investment are likely to suffer a similar fate,” she adds. “Covid recovery subsidies can kick-start development, but will not in most cases result in continuous development.”
Policymakers in Brussels believe an EU renovation wave can create an additional 160,000 jobs in the construction sector by 2030 and enthusiasm is similarly high in the UK. However, even in the short term, the construction industry is rarely a poster child for good jobs.
“The breadth of today’s green jobs – from planting trees to farm labourers and power engineers – makes it obvious that not every green job is automatically a good, high-quality job – but they could be,” says Mika Minio-Paluello from the UK’s Trade Union Congress. She expresses particular concern about job quality in energy efficiency retrofitting.
“We think insulating and retrofitting is extremely important, but the UK construction sector is fragmented,” says Minio-Paluello. “Most workers are self-employed or work for micro-companies, with no job security, training opportunities or accountability for them.”
Samantha Smith, head of the Just Transition Centre in Norway, agrees. “Every job can be green to a degree,” she says, insisting health and safety are of primordial concern whether a job is green or not. With construction the “backbone of the European Green Deal” and the “most dangerous job in terms of fatalities” she is worried. In 2018, one-fifth of all fatal accidents at work in the EU 27 took place within the construction sector, shows Eurostat data.
“In the renovation and construction industries, there is lots of illegality, which can mean no contracts, workers don’t get their wages paid on time and they are not paid overtime,” says Smith. “We need to address what kind of jobs are being created, whether workers can organise, are they safe at work, and do these jobs pay a decent wage.”
The renovation sector “can be a huge source of good jobs” when done right, says Smith. She references Oslo, Norway’s capital, whose procurement policy means that any company wanting to sell its construction services has to demonstrate it has decent labour standards, including secure contracts, training and apprenticeships, and real health and safety measures. “The labour movement would like to see all municipalities taking a similar approach,” says Smith.
Digitalisation will also help reform the construction sector, argues Adrian Joyce, Director for the Renovate Europe campaign, whose aim is to reduce the energy demand of the EU building stock by 80% by 2050. “People think the construction industry is dirty, difficult and dangerous,” says Joyce. “This is the case for some jobs, but an increase in digitalisation is making the sector safer and creating new opportunities.” He cites the emergence of cobots, or collective robots, that can replace humans for the most dangerous tasks.
Joyce would also like to see “more and better apprenticeship schemes and ongoing professional training and development for existing construction workers to give them a career path”.
Scale makes it easier to ensure high quality jobs are created, says Minio-Paluello. “Where there is a big infrastructure project, there should be a framework agreement negotiated between the government, companies and unions covering jobs and staff development”, as there was for the UK Olympics in 2012, the nuclear plant Hinkley Point C or Terminal 5 at Heathrow airport, she says.
“Nuclear and aviation have created good-quality jobs because of such agreements,” says Minio-Paluello. “There is no reason this can’t happen for future green jobs, but there needs to be a sectoral approach so the desired scale is achieved,” she insists, echoing Smith’s call for proper procurement policies.
“The labour costs associated with bringing down emissions and creating decent safe jobs are only a tiny part of the overall investment needed in every sector,” says Smith. “Employers and government need to make sure people get a decent wage, have rights, and don’t die at work.”
Trade unions believe the UK government’s approach to offshore wind, with its focus on contracts for difference (CfDs), has failed to build-in job creation and job quality as conditions for securing licences and contracts.
“CfDs drove down offshore wind costs, but created limited local economic benefits or investment in domestic supply chains,” says Minio-Paluello. Germany and Denmark, which have “invested with a long-term perspective” in the energy transition, are doing better in creating good-quality green jobs, she suggests. “To really lead in 21st-century clean technology, we need bigger government and smarter public investment.”
The wind industry remains fully supportive of the CfDs model. “It makes sense,” says Christophe Zipf from Brussels-based WindEurope. “CfDs significantly reduce the financing costs of new projects and therefore overall project costs. Wind energy, especially offshore wind projects, require high upfront payments. CfDs create revenue stabilisation. Banks like that. With CfDs in place, banks are willing to lend money at much lower interest rates. CfDs make wind energy cheaper for governments and electricity consumers.”
He also contests efforts to draw parallels between countries. “It is difficult to compare job creation in the wind industry in different European countries given the number of factors that need to be taken into consideration, including installed capacity, future auction volumes and the fact workers may move from one country to another,” says Zipf.
In an effort to examine some of these issues, the UK government has set up a Green Jobs Taskforce, of which Sue Ferns, senior deputy general secretary at trade union Prospect, is part. Like Smith, she is deeply concerned by health and safety issues, in particular in the offshore wind industry, commenting that “oil and gas has a much better record”. This situation is again “partly due to CfD financing, which gave a great boost to bringing down costs, but at what expense?” says Ferns.
“The auction process does not allow companies to allow budget for training and development,” she adds. “In other sectors, there would be budget for trainees to shadow engineers, for example, but the UK’s offshore wind financing regime is a lean resourcing model that compromises health and safety.”
In the respective reports produced in 2019 by Oil & Gas UK and G+, the offshore wind industry health and safety body, the number of fatalities or accidents that required time off work is recorded as 0.72 per million hours a year in the UK offshore oil and gas sector and 2.3 per million in offshore wind.
Trade body RenewableUK says offshore wind industry and oil and gas sector statistics are not directly comparable because they use different methodologies. “The offshore wind industry is bringing significant industrial benefits to the UK, with factories and supply chain companies forming centres of excellence around the country, employing thousands of people in highly skilled jobs,” says RenewableUK’s deputy chief executive Melanie Onn. “We are urging trade unions to work with us to maximise these benefits.”
Green job metrics
The announcement by the UK in April 2021 of a new carbon emissions reduction target of 78% by 2035 prompted Prospect to reiterate its call for a “deliverable set of goals on green jobs”. Ferns would like to see some clear metrics around green jobs based on, for example, health and safety, workforce diversity and unionisation to ensure green and ethical go hand-in-hand. “We absolutely support the growth of renewables,” says Ferns. “We want the sector to do well and to support it, but want it to do well on the basis of good-quality engagement. Some employers are not getting this message.”
For Smith, a good green job would offer a “proper contract, fair wages, pension and healthcare” and enshrine labour standards based on EU principles and the European social pillar. Companies would be able to offer such employment terms because budget would be allocated in project financing.
“We can’t do everything and drive down costs,” concludes Ferns.
This is the second article in a special series on green jobs Energy Monitor is running around Labour Day on 1 May. The other articles in the series are:
- Investment in skills is key to realising the clean energy transition
- Joe Biden’s push to unionise US clean energy workers
- Finance sector skills shortage puts ESG in focus
- Hydrogen tests climate policymakers with its job potential
- With local supply chains, electric vehicles can be good for jobs