Market News

 May 14, 2020
Investing in green infrastructure would create millions of jobs

 Of the 33 million Americans who have filed for unemployment since the coronavirus crisis began, many expect to get their jobs back---in one recent poll, 77% of workers who have been laid off or furloughed say that they expect their employers to rehire them. But economists say that may be overly optimistic; some jobs won't survive, and new ones will need to be created to replace them. As Congress debates more stimulus funding, one of the best ways to add new jobs may be to invest in green infrastructure.

"Jobs in the low-carbon sector have been growing at a much faster pace than overall employment, and they are expected to have dramatic growth going into the future," says Devashree Saha, a senior associate at the nonprofit World Resources Institute (WRI). "In a situation like today, with unemployment rising, significant investment in clean energy and other low-carbon sectors as part of the economic recovery is a very effective way to create jobs in the near term."

The organization plans to model exactly how many jobs could be created through specific policies. But for now, in a series of fact sheets based on previous research, they give a rough sense of the scale. Until COVID-19 hit, the energy efficiency sector was the largest job creator in energy, employing at least 2.4 million people as of 2019 (the coal industry, by contrast, employed around 70,000 people.)

Retrofitting homes and businesses to save energy, something that needs to happen nationwide, could add millions of jobs. A $1 million investment in energy efficiency creates around eight full-time jobs, nearly three times as many as an investment in fossil fuels. The work can also save small businesses 10%-30% in utility costs---something that could help those businesses survive.

Modernizing the electric grid could create 150,000 to 200,000 jobs each year, while also making the system more resilient and reducing energy costs. Investing $12-16 billion in the grid annually could lead to $30-40 billion in economic activity each year. Similarly, investing in renewing the country's aging transportation infrastructure could create thousands of local construction and manufacturing jobs. Each $1 billion invested in public transportation can create 50,000 jobs. Investing in mass tree restoration---a helpful tool in fighting climate change---could create more than 150,000 jobs each year.

While WRI didn't focus on other types of green jobs, the list is long. Offshore wind projects, for example, could also create hundreds of thousands of jobs; some large projects, including a $2.8 billion wind farm off the coast of Massachusetts, are ready to begin construction once they pass some final regulatory hurdles. Renewables are struggling in the current crisis, but "there are still signs that the renewable energy industry is weathering the crisis far better than fossil fuels," says Saha. The electric vehicle industry could be another area of growth and already employs more than 275,000 people in California alone. All of this together can't replace all of the jobs that are being lost now, but it could play an important role.

It's not clear what Congress will do in future stimulus bills; one bond buyback plan is set to give fossil fuel companies $750 billion. But with little time left to act on climate change, environmental organizations are pushing for green investments instead. "In many ways, I think COVID-19 has been a reality check for us," Saha says. "It has given us a preview of the kind of disruptions that climate change can bring. At the same time, COVID-19 also offers a chance to rebuild the U.S. economy in a cleaner and more sustainable way---in a manner that can reduce pollution, that can create good jobs, and also advance a more reliable and resilient power. I think U.S. policymakers should not miss this chance to place climate change and investment in low-carbon infrastructure at the heart of the recovery process."