The Climate Change Committee (CCC) said that the UK Government needs to enact “stronger policies to harness the potential and manage the risks” to make the most of the job opportunities created by the net zero transition.
- The net zero transition has already created 250,000 jobs, with up to 725,000 net new jobs expected to emerge.
- The UK’s international competitiveness, however, is at risk due to a lack of skills and stronger policies in other countries.
- Government intervention is not necessary for every sector of the economy, but clear policy direction for each sector needs to be combined with a responsive education and skill system.
In a new briefing on green jobs and the UK economy, the CCC says that the transition can offer “significant net employment creation” across the country. Estimates suggest that between 135,000 and 725,000 net new jobs would emerge in low-carbon sectors such as buildings retrofitting, renewable energy generation and electric vehicles.
A key finding was that Government intervention is not necessary for every sector of the economy, but clear policy direction for each sector needs to be combined with a responsive education and skill system. Net zero can offer employment for economically deprived areas through the ability to direct the necessary programme of investment, according to the CCC.
A quarter of a million jobs already created
The Committee said that around 250,000 jobs have already been created in the transition, but that all workforce opportunities can only be realised with stronger policies to maximise potential and minimise risks.
The sectors expected to see major change on the road to net zero represent around one-fifth of the current total workforce, and two-thirds of these workers are poised for growth, especially in roles related to buildings and retrofit and EV battery manufacturing.
Around 7% of UK workers are in sectors that will gradually redirect their products and services transition from the use of fossil fuels to low-carbon methods, including cement and steel. Less than 1% of UK workers are in sectors likely to face declines over the transition, including oil and gas extraction and coal, with the CCC foreseeing around 15,000 net job losses amongst this cohort as a result of shrinking production by 2030.
The majority of these workers are in Scotland or Wales – which together account for around 63% of all oil and gas jobs – and are “particularly concentrated” in Aberdeenshire. The CCC that this could have an impact on local communities that rely on high-income jobs within the sector.
These changes, however, are expected to be gradual – provided they are adequately planned for – and workers’ skills are likely to be in demand as other sectors grow, particularly in wind, CCS and hydrogen, according to the report.
“Given the geographical concentration of workers there may be a risk of disruptive localised impacts, notably in Scotland where these jobs are mostly concentrated, without targeted intervention,” the report said.
For that reason, it said a “hands-off approach” to the workforce from the Government “will not work.” Jobs growth is not guaranteed and will require “active reskilling and upskilling” and government support in key areas.
The CCC warned of a risk to the UK’s international competitiveness in the face of the US Inflation Reduction Act (IRA) and the EU’s proposed Green Deal, mostly due to a lack of skills that could help attract investment to the UK.
Indeed, areas such as EV and battery production face major pressure as countries rush to offer new subsidies for inland manufacturing. As such, the UK “must defend its competitive advantage” in sectors such as hydrogen and carbon capture.
Lord Deben, chairman of the CCC, said: “The UK has committed to Net Zero. The only question is whether the Government intends to get there in a way that benefits workers or leaves them behind.”
“This is a unique moment to tailor our approach to skills and jobs, in the certainty of achieving the legal goal. A Net Zero workforce means secure employment for the future. This is an opportunity for the Government to bring real meaning to ‘levelling up’.”
The report follows similar warnings issued by Scottish First Minister Humza Yousaf who said without “urgent change”, the UK would fall behind its international competitors and risked “throwing away the transformational green opportunities available to Scotland.”
No more ‘scaremongering’ on net zero jobs
Greenpeace policy director Doug Parr added: “This report thoroughly rejects any scaremongering that the net zero transition will be bad for UK jobs. In fact, it demonstrates the huge potential for hundreds of thousands of new roles in low carbon sectors.”
“But our economy won’t benefit without the right government assistance for workers who need retraining, and sectors that need support. It must prioritise working with the communities most affected to attract new employment as the old jobs disappear.”
“The government must show it matches the drive, policy and green finance shown by the US, China and the EU otherwise we will continue to lag behind in the international race on clean tech.”
According to the World Economic Forum’s (WEF) The Future of Jobs Report 2023, 23% of all jobs are expected to be disrupted over the next four years, but this disruption comes with significant opportunities. The International Energy Agency estimated that a green-recovery scenario could add close to 3.5% GDP growth globally, as well as a net employment impact of nine million new jobs created each year.
This shift has pushed global demand for green skills by 40% since 2015, but only 13% of the world’s workforce has them, indicating a significant gap. By acting early to address this shortage and showing effective leadership, the UK could restore its competitive advantage.
With additional reporting from Energy Voice.