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In the battle against climate change we often hear that new renewable energy programs will generate a large number of new jobs. At the recent Paris Climate summit Boris Johnson said that a green recovery from Covid would generate opportunities for high-skilled workers, creating millions of jobs (here). As part of Joe Biden's renewable energy plan he suggested that 10 million clean energy jobs will be made available (here). Although this bodes well for the renewable energy sector, it may be difficult to project how this will affect the job market as a whole.

The employment market is complicated and there are unexpected consequences to rapid changes in labour supply and demand.

Although it makes sense that investing money in the clean/renewable energy sector will generate more new jobs, does this mean that there will be a net decrease in unemployment? Put in other words, the incentive to invest and develop in the renewable energy sector is often presented as a strategy that will generate a net increase in jobs; is this correct?

(I understand that this will differ for each policy plan, job market, technology sector, economy, etc. so if the question can be sharpened, that would be appreciated).

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    Nobody knows what will happen in the future, so it's not clear how this claim could be proved true or false, except by implementing the policy and seeing what happens. There are of course many different economic models that would offer predictions as to what would happen, but nobody can be sure that any given model will accurately predict the future. I don't know what sort of answer this site could offer to this question. Dec 12 '20 at 20:47
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    Economics.SE might be a better fit for this question, which is unlikely to be answered with empirical evidence.
    – Oddthinking
    Dec 13 '20 at 0:25
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    The linked claims talk only about there being new jobs in the green/clean energy sector, not a net increase in jobs. The net increase seems to be your extrapolation from what they've said. Do you have a notable claim that talks about net change? Dec 13 '20 at 8:52
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    Creating millions of new jobs doesn't necessarily mean a net increase in jobs. It's only talking about the new jobs created, not the old ones lost.
    – Simon B
    Dec 13 '20 at 17:02
  • I would say this question involves "unresolved current events". Dec 14 '20 at 20:53
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The extrapolation is plausible

I can't directly answer the question exactly as it's written. The only way we could answer this question with any certainty is to wait and see - what happens if someone invents a way to automate non-renewable power plants so they don't need workers? Or what happens if someone invents a giant robot that automatically builds solar power plants?

But we can compare employment in renewable energy and non-renewable energy to get an idea whether this claim is plausible or not - is this extrapolation well founded?

I'm going to pick one market to examine just so this scope is manageable. This is Australia's energy mix:
enter image description here

Coal is 56%, Gas is 21 percent, oil is 2%, renewables is 21%.

14,000 Australians are employed in gas power generation. This includes extraction and distributions. This is a high estimate as it also includes plumbers working with gas with residential cooking and heating installations, and the infrastructure to export gas to other countries.

38,100 Australians are currently employed in the production of thermal coal power - (brown coal or black coal burnt for power is classified as thermal coal).

26,850 Australians are currently employed in renewable energy activities. 27% increase from 2017-18 financial year to 2018-2019 financial year. 120% increase over 10 years

  • Coal employs 38100 / 56 = 680 people per 1% of Australia's power generation. Were Australia's power 100% coal we could extrapolate that it would employ 68,000 people.
  • Gas employs 14000 / 21 = 666 people per 1% of Australia's power generation. Were Australia's power 100% gas we could extrapolate that it would employ 66,600 people.
  • Renewables employs 26850 / 21 = 1278 people per 1% of Australia's power generation. Were Australia's power 100% renewable we could extrapolate that it would employ 127,800 people.

This extrapolation suggests that replacing a 100% coal Australia with a 100% renewable Australia would result in a net employment of 59,800 people, and every 1% that transitions from coal to renewables will employ an additional 598 people.


But wont renewable jobs plateau?

This extrapolation would be mitigated by economies of scale (more renewable energy generation is residential rooftop solar than large scale solar farms), and by a surge in the number of construction jobs as renewable projects are done. Gas power generation is also experiencing similar growth in Australia to renewables yet the number of people employed per unit of power is in the same ballpark as coal, which is trending down in that energy mix graph.

If our power needs plateau this century so no more construction is needed, after our power reaches maximum renewable levels, there will likely be a reduction in renewable energy jobs as no more construction is needed. This is unlikely to occur before we've reached net zero carbon, so for Australia around 2050.

Boris Johnson will be either dead or have long since retired from politics by the time this happens - if it ever does happen, so it's reasonable to assume that this is beyond the scope of his answer.

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