Business·Analysis

Job killer or job creator? Experts predict a climate employment boom: Don Pittis

Critics have warned the economic disruption caused by fighting climate change will lead to massive unemployment, but something different seems to be happening.

Fears that fighting climate change will create unemployment appear unfounded

Despite worries that reducing carbon would be a job killer, Canadian employers say hundreds of thousands of jobs remain unfilled. (Don Pittis/CBC)

"Scrap your job-killing carbon tax plan," Ontario Premier Doug Ford told Prime Minister Justin Trudeau just over a year ago. Of course since then, the Canadian economy has continued to crank out jobs as the unemployment rate hovered near record lows.

Wages have been rising above the rate of inflation and businesses have repeatedly complained they can't find enough workers, resulting in hundreds of thousands of private sector jobs going begging.

Economists polled by the business wire service Bloomberg, on average, predicted that unemployment would stick at 5.5 per cent in the November report. This morning's job figures from Statistics Canada came in at 5.9 per cent.

Economic data doesn't move in a single direction, but as the economy goes through its inevitable future ups and downs, credible research from Canadian and international experts indicates that fighting climate change will be the very opposite of a job killer.

Certainly Ford and his fellow conservative premiers are not the only ones who have warned about the perilous effects of cutting back on carbon use.

Destroying up to 20 million jobs? 

"It is widely acknowledged … that a $40 per ton carbon tax would increase the price consumers pay at the pump by about 38 cents per gallon," pronounced the American Legislative Exchange Council in 2018. "And a study commissioned by the National Association of Manufacturers found that a carbon tax could destroy anywhere from nearly four million to more than 20 million American jobs."

Of course that is simply not what has happened in places where a carbon tax has been imposed, partly because money taken out of the economy in carbon taxes comes back into the economy elsewhere.

And in recent statements this fall, the same U.S. manufacturers group has adopted a positive stance on climate, demanding that Congress re-engage with the international community and set binding federal rules that will create a level playing field for industry.

Workers install a backlit billboard in downtown Toronto's system of underground paths. Many specialist jobs will be little affected as the economy reduces carbon. (Don Pittis/CBC)

What many business leaders are realizing is that rather than being a cost that will drag industry down, the competition required to create a low-carbon economy has the potential to ignite a new boom. If so, the latest promise to cut carbon in yesterday's Canadian throne speech will be an economic stimulant.

And when it comes to jobs, economic experts who have studied the effects of climate change, including Mark Jaccard, the Simon Fraser University professor who helped British Columbia create its world-leading carbon-fighting plan, say the impact on jobs is unequivocal.

In an email conversation, Jaccard said that in his forthcoming book The Citizen's Guide to Climate Success, expected in January, he hardly mentions jobs because the answer is obvious and the evidence undisputed.

"Shifting away from uncontrolled burning of fossil fuels is a net job gain because the alternatives are, on average, more labour-intensive," said Jaccard in his response to my question. "This is true basically everywhere in the world."

Of course, as anyone who has shovelled a long driveway without benefit of a snowblower knows, doing things the hard way is often more labour intensive, but it is not always better or more efficient.

Costs minus benefits

Economists used to calculate those kind of inefficiency costs without acknowledging the benefits, but Jaccard says, "No business could survive if it took such an approach."

More modern studies that add in the costs of doing nothing — fires, flooding, agricultural losses, forced mass migration — show the global macroeconomic impact close to balance.

But even that assumes economies are somehow static and that the cost of fighting climate change is like water dipped out of a limited pool. Instead, economies have always gone through dynamic change. Climate adaptation and mitigation are just some of the modern drivers of that change, says Stewart Elgie, with the pro-business Smart Prosperity Institute.

"Any transition means loss of some existing jobs and the creation of new ones, and we'll see the same here," said Elgie by phone from Ottawa. Construction jobs are just one area expected to see an increase.

Most provinces will see a significant increase in construction jobs as carbon prices rise, says the pro-business Smart Prosperity Institute. (Smart Prosperity Institute)

"Ultimately there will be somewhat more jobs in a low-carbon economy — that's what most of the numbers say. The challenge for Canada is positioning ourselves to capture our share of those jobs and punch above our weight."

Elgie says fighting climate change will continue to affect jobs in the fossil fuel industry, but the transition will happen over decades and, if well managed, will not lead to a regional spike in unemployment. But action needs to be taken now.

"You can't just flip a switch" said Elgie. "We have to prepare to transition the economy of oil-producing regions so that they are beginning to generate the next generation of jobs as oil and gas begins to slow down."

Smart Prosperity research shows Canada's oil and gas industry is by no means disappearing in the near term and will even grow over the next decade. It is just that low-carbon industries will grow more quickly.

According to the World Resources Institute, acting on climate change will create a direct economic gain of $26 trillion US and create 65 million jobs. 

In the Canadian context research from Clean Energy Canada suggests clean energy will create 160,000 jobs while the fossil fuel sector loses 50,000 jobs. Most of those losses will be due to greater efficiency in the oil and gas industry. 

"We're trying to say this is not something we should be afraid of," says Sarah Petrevan, policy analyst with Clean Energy Canada. "It is something we should welcome."

Follow Don on Twitter @don_pittis

About the Author

Don Pittis

Business columnist

Don Pittis was a forest firefighter, and a ranger in Canada's High Arctic islands. After moving into journalism, he was principal business reporter for Radio Television Hong Kong before the handover to China. He has produced and reported for the CBC in Saskatchewan and Toronto and the BBC in London. He is currently senior producer at CBC's business unit.

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