Center for American Progress

Stronger Climate Policies Will Create Low-Carbon Jobs Worldwide

Stronger Climate Policies Will Create Low-Carbon Jobs Worldwide

Generating Clean-Energy Jobs Through Good Policy

CAP and the Global Climate Network release a report on domestic low-carbon job creation in an interconnected world.

A construction worker places a solar energy panel in a solar energy field under construction in the Sacramento Municipal Utility District in Rancho Cordova, California. (AP/Rich Pedroncelli)
A construction worker places a solar energy panel in a solar energy field under construction in the Sacramento Municipal Utility District in Rancho Cordova, California. (AP/Rich Pedroncelli)

Download the full report (pdf)

Download the executive summary (pdf)

This week, delegates from 192 countries arrived in Copenhagen to move forward on the terms of a new international agreement on curbing carbon pollution. Nevertheless, many countries, including the United States, are under severe attack that the measures they are taking to address climate change cannot be justified while their economies remain weakened by the global recession. The International Labor Organization estimates that global unemployment in 2009 will increase by between 18 million and 50 million relative to 2007. Stimulating growth, reducing unemployment, and maintaining competitiveness have become top priorities around the world.

Yet growing evidence suggests that investing in a low-carbon economy will not only reduce our dependence on fossil fuels but generate new economic opportunities. In fact, the global recession has increased the urgency of building new industries that can support new jobs and sustainable growth during the 21st century. Policymakers around the world have seized this opportunity, creating renewable energy and energy efficiency provisions in domestic stimulus bills and designing climate legislation to produce dividends in employment and economic growth.

As the Copenhagen climate talks refocus the world’s attention on the environmental imperative for stronger climate policy, member nations should not lose sight of this economic opportunity.

The Center for American Progress, along with eight other progressive think tanks around the world, together constituting the Global Climate Network, or GCN, today launches its third joint report, “Low-Carbon Jobs in an Interconnected World.” Together with our partner institutions in Australia, China, Germany, India, Nigeria, South Africa, and the United Kingdom, we conclude in this report that directed steps to reduce carbon pollution will create tens of millions of jobs worldwide. This is one of the strongest arguments that moving forward this week with an international climate agreement is in the best domestic interests of the parties meeting in Copenhagen today.

For this study, eight of the nine GCN partners surveyed existing research on domestic and international low-carbon job creation, interviewed executives of low-carbon industries, reviewed existing government policies to invest in low-carbon industries, and, where possible, estimated the number of domestic jobs that could result from aggressive climate policies in other countries.

We reached four key findings through our work that policymakers should consider:

Low-carbon industries have the potential to create tens of millions of high-quality jobs, but strong government support for these industries will be necessary to realize potential gains. This is consistent with our prior studies on low-carbon job creation in the United States. The American Recovery and Reinvestment Act passed in February has already begun channeling funds to low-carbon industries with the expectation that this investment will create American jobs. The American Clean Energy and Security Act passed by the House of Representatives in June would increase spending on renewable energy and energy efficiency while establishing a price on carbon through a cap-and-trade program, which would make low-carbon industries more cost competitive. Previous work by CAP and the Political Economy Research Institute estimates that a net of 1.7 million new low-carbon jobs (2.5 million total) could be created in the United States as a result of these two bills.

What’s more, GCN members identify as many as 19.7 million potential low-carbon jobs in selected sectors that could be created by 2020 in member countries as a result of strong climate policies. It is important to note, however, that this figure, though impressive, is very conservative and vastly underestimates the number of jobs which can be created worldwide with existing and pending policies.

First, it is a restrictive study of only eight developed and developing countries and does not include the millions of clean-energy jobs that have been or will be created in countries like Brazil, Indonesia, and the 25 EU countries not included in the study. Second, this figure includes only selected low-carbon industries in each country to make it possible for us to go deeper into the brute statistics for job creation to find more support for the accuracy of these figures. It includes fewer than 300,000 of the total clean-energy jobs we identified in our reports with PERI. We focused on a relatively small subset of the job creation potential in select countries in order to demonstrate in particular how clean-energy job creation will be shaped in those sectors that can take advantage of interconnected global markets.

For example, our research in this report demonstrates that aggressive smart grid deployment in the United States could create 139,700 American jobs from existing programs. CAP estimates that a further 138,000 U.S. jobs might be created to serve the export market if American manufacturers and software developers are able to maintain their comparative advantage in this field. We suggest that countries must develop national, low-carbon industrial strategies to best capture the economic opportunity a global low-carbon transition will offer.

Sufficient finance is critical to the creation of low-carbon jobs. With finance constrained in the current economic climate, low-carbon industries cannot attract the private financing they need to survive. Government stimulus can play a significant role in attracting private investment to these industries. We suggest that governments continue to use federal funding and policies to leverage private investment in renewable energy and energy efficiency.

Each of our national studies concludes that training new workforces will be essential to the success of low-carbon industries. We suggest that governments should tackle this challenge by identifying likely skills gaps that an accelerated transition to a low-carbon economy would create.

We have all concluded that adjustment policies should form part of the low-carbon deployment strategy. Jobs will be lost in certain industries as economies shift away from traditional energy sources and technologies. However, since these industries have traditionally been less labor intensive than their replacements will be, the low-carbon transition promises to create a net job gain. Governments can reduce the impacts of such a transition on high-carbon industries by supporting staff retraining initiatives.

We are living in an interconnected world, as the global financial crisis demonstrated. The health of the world’s economies is inextricably linked, markets have become truly global, and domestic policy can have drivers and impacts far beyond a country’s borders. Our study demonstrates that action to address climate change does not have to come at the expense of domestic interests. Copenhagen offers an opportunity to coordinate national policies on climate change and should not be seen as a threat to national objectives.

Download the full report (pdf)

Download the executive summary (pdf)

John D. Podesta is President and CEO of the Center for American Progress, Saya Kitasei is a Sustainable Energy Fellow at the Worldwatch Institute, and Andrew Light is a Senior Fellow at the Center for American Progress and CAP’s liaison to the Global Climate Network.

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Andrew Light

Senior Fellow