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Green skills essential for the UK’s economic recovery

two wind farm engineers walk away from the door way of a wind turbine. they are wearing orange hi vis jackets and blue hard hats . one is male , one is female. In the background wind turbines can be seen across the landscape down to a distant city .

The impact of global warming and other environmental disasters have created an impetus for change. For the ‘green industrial revolution’ to be delivered, we need urgent investment in green skills.

The pandemic has thrown most of the world’s national economies into crisis. Livelihoods and trade have been partially suspended. As a result, governments are investing trillions of dollars into stimulus plans.

The global experience of Covid-19 has thrown into sharp relief the wider context of global pollution and warming. Many scientists argue that zoonotic diseases (which pass from animals to humans) may result from human disruptions to the ecosphere. The Intergovernmental Panel on Climate Change (IPCC) warns that in this century, the world can expect temperature rises of between 1.4 and 5.5 degrees Celsius. Marine pollution, air quality, sustainable agriculture and more are among the additional human security risks facing the world.

It is unsurprising, therefore, that attention has focused on how the world’s economic recovery could be green. Governments are making various commitments to tackle the climate crisis. Central to the green recovery is green tech: renewable energy, electric vehicles, carbon capture and green agriculture.

So, how can green tech stimulate the global economy and what does this have to do with skills?

Green economic recovery

When it comes to sustainability and the economy, a good place to begin is what happens if we don’t take urgent action against the plethora of environmental challenges described above.

The Energy & Climate Intelligence Unit (ECIU) reported that climate-related disasters have already cost the world $650 billion between 2016 and 2018. They were likely to depress agricultural yields by up to 30% by 2050. Should warming continue unabated, the economic costs are huge. The IPCC estimates that the economic cost of warming damage in 2100 for rises of 1.4 and 2 degrees Celsius were $54 trillion and $69 trillion respectively.

If the economic costs are so huge, why aren’t developing nations doing more? The ECIU says that:

“The future costs and benefits of climate change are uncertain and unevenly distributed. For example, the costs of dealing with the impacts of climate change will disproportionately fall on developing countries, while the financial costs of cutting emissions to mitigate those impacts fall mostly on developed nations.”

In other words, the impact falls on those far beyond the vision of the developed nations while the latter have most to do when it comes to policy reform and green investment. However, the impact on developed countries is also significant, says the International Monetary Fund:

“…climate change can entail significant risks to macrofinancial stability. Nonfinancial corporate sectors face risks from climate damages and stranded assets – such as coal reserves that become uneconomic with carbon pricing – and the disruption could affect corporate balance-sheet quality.”

There may be another incentive for committing to urgent action. As a result of the pandemic, global growth has plummeted, particularly in those nations with high transmission. Government investment in green technologies has the potential to boost the economy and jobs while fundamentally resetting energy and environmental sustainability. As a report by the Organisation for Economic Co-operation and Development says:

“When well designed and implemented, green stimulus measures can generate income, create jobs, improve wellbeing for all and build resilience.”

Green skills

Friends of the Earth and Transition Economics published a report in March 2021. They are advocating the growth of green apprenticeships. Pointing out that half a million young people between the ages of 16 and 24 are unemployed, and that is discounting furlough, they argue that the opportunity to grow the green economy and solve youth employment is too important to miss.

The Climate Change Committee’s Sixth Carbon Budget published in December 2020 says that carbon emissions need to fall by 80% by 2035. This means that the green infrastructure needed to achieve this goal needs to be in place in the next 10 years. Examples of urgent action include green home improvements, public transport and cycling infrastructure, electric vehicles, renewables and new woodlands.

The report identifies the following green-skills gaps and shortages in the UK:

  • Shortages in farm and forestry workers and reskilling in farming.
  • In utilities, skills shortages among engineers, heat network project managers, control system specialists, quantity surveyors, technicians; skills gaps among heat pump installers and environmental assessors.
  • Skills shortages in wind and marine energy supply chains (all occupations) and reskilling across manufacturing.
  • Green construction skills shortages in the building trades.
  • Shortages in railway operations and directors, managers and operatives in logistics and warehousing.
  • Reskilling needed in service industries.

The report says that creating 250,000 green apprenticeships would cost £6.2 – £10.6 billion in total funding over five years. This is compared to the economic cost of £32 to £39 billion in wage scarring where young people left to languish in unemployment for one year.

Economic boosterism

There is an emerging consensus in government and policymakers that the state has a role to play in encouraging economic recovery.

Investment in green tech is low in the UK compared to comparative nations like France and Germany (£4/5 billion currently in the UK compared to £13.5 billion in France and £36 billion in Germany). However, the government’s ten-point plan arguably shows at least a tangible commitment to green ideals. It has also promised 90,000 jobs in green industries in this parliament and 250,000 by 2030, with necessary training undertaken through the Lifetime Skills Guarantee. And yesterday’s budget will create a National Infrastructure Bank for green projects and green bonds. It also clawed back money from the home insulation scheme and froze fuel duty.  

It is evident that we need the skills to fuel that growth in green investment. Without skills, business will be unable to start up or scale up to meet demand. Apprenticeships, traineeships and a green skilling of the education sector may be just the impetus the economy needs.

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