Green Jobs, Part 1: A Look at “Green” Occupations
In this first installment, we will take a look at some of the implications of policy to create green jobs. Over the coming weeks and months we will be releasing periodic articles, essays, white papers, data spotlights and other perspectives around green jobs. The goal is to help local practitioners know and understand this issue so they can develop intelligent, data-driven local responses. If you have more specific questions or would like to see other issues addressed, please contact us (rob@economicmodeling.com).
Download the Data Spotlight in PDF format: Green Jobs
Introduction
Among the many economic stimulus proposals coming out of Washington of late are calls to transform the economy and reduce energy dependence through “green investments” and the creation of “green jobs.” But just what constitutes a “green investment?” And how does one distinguish a “green” from a “non-green” occupation?
With promises of major federal investments in the coming year, forward-looking regions are struggling to know how an emphasis on green development will change their economies, and specifically which green initiatives to pursue. This data spotlight uses EMSI’s suite of web-based tools to examine some of the issues.
What is a Green Job?
The US Department of Labor identifies nearly 900 distinct occupations (The Standard Occupation Classification System). Matters would be greatly simplified if we could simply scroll through the Labor Department’s list and identify some occupations as green and others as not. Unfortunately, things are not that simple. The consensus among those economists who address these issues is that the designation “green” turns not on the specific task associated with an occupation, but rather on the specific outcome of an occupational effort.
Accordingly, green jobs result in green investments. Green investments aim to drive households, companies, and governments to act in more “environmentally stable” ways (e.g. reduce pollution, increase energy efficiency, curb carbon emissions, improve air, soil, and water quality, etc). A short-list of specific green investments includes:
• Building Retrofitting,
• Mass Transit,
• Smart Grid,
• Wind Power,
• Solar Power,
• Cellulosic Biofuels.
The list comes from the report entitled, “Green Recovery,” (download the pdf) which was produced by the Center for American Progress and PERI. There is no question that there will be policy (and money) directed at these areas. Therefore, the question for regional decision makers is, which of these initiatives, or combination of initiatives, provides the greater economic development advantage to their region? To answer this question requires (1) data on the specific regional economy, (2) data on the direct spending of the various investments, and (3) a careful distinction and estimation of short-term, (i.e., construction phase impacts), from the longer-term impacts associated with the investments in place.
At this point one of the first things we can do is look at occupations likely to be affected by the policy implications around the creation of “green jobs” and more specifically, green building projects. With the Obama administration calling for quick implementation of an economic recovery plan which includes vast public infrastructure projects and job creation with an emphasis on green jobs, a few key occupations were identified in the PERI report (see the table below). We have used that list as a starting point for our occupational analysis. In this paper, we’ll only focus on two categories: building retrofitting and mass transit/freight rail.
For occupational employment numbers, we used EMSI’s Economic Forecaster module, which provides the user with the ability to analyze industries (categorized by 2-6 digit NAICS), and occupations (categorized by 2-5 digit SOCs) for any county, ZIP, MSA, or custom region in the country. For this analysis we have provided the national outlook for these occupations.
The Results
Retrofitting and repair of public buildings and public schools for the purpose of energy-efficiency will take on a number of forms, from simple light-bulb replacement to the entire overhaul of HVAC systems. Meanwhile, the Mass Transit/Freight Rail investment includes expanded bus and subway services to upgrades of the freight and light rail systems.
1. Building Retrofitting
The first table details how the selected occupations for Building Retrofitting have changed from 2005-2008. The point here is to generally understand the recent trends in these occupations: the employment, earnings, educational levels, and need for replacement workers. Note the number of replacement jobs, which include retirement and outmigration, often is larger than the total job growth on an annual basis. For more on the value of analyzing replacements, click here.
The next table lists the top industries that employ the occupations listed above. Keep in mind the 2008 figures are projections based on EMSI’s latest data set, which includes Current Employer Statistics. The addition of CES makes these numbers reflect the recent housing bust – a key reason why Residential building construction and Framing contractors are listed with negative 3-year growth.
Findings
- Clearly, construction and other related sectors make up the lion’s share of these jobs. Indeed, that seems to be one of the more concrete ideas contained in Obama’s proposed stimulus package – aiding the construction sector. As a result, if this policy goes through we would expect a jump in the construction sector, which is currently in decline.
- Half of the occupations included (Carpenters, Insulation workers, Roofers, Carpenter helpers, and Industrial truck/tractor operators) are showing a loss of jobs from 2005-2008. Yet the outlook improves greatly once we factor in replacement jobs.
- Most of the affected occupations are in middle-skill areas – only one of the occupations (Construction managers) normally requires a bachelor’s. The rest of the list is comprised of jobs that do not require associate’s level or higher degrees.
2. Mass Transit/Freight Rail
The first table gives key figures for 10 occupations that PERI estimates will comprise the Mass Transit/Freight Rail cluster. Many of these jobs are higher-paying than those in the Building Retrofitting category, and most still only require on-the-job training, which would presumably create a lot of middle-skill jobs.
Below are the top industries that employ these occupations. This list was created by running an inverse staffing pattern.
- Unlike in the Building Retrofitting category, all the industries that show up here report growth. The Architectural, engineering, and related services sector is particularly robust with 11% growth.
- With respect to replacement jobs, six of the occupations (Civil Engineers, Rail-track layers, Structural metal fabricators/fitters, Welders, Locomotive engineers/operators, and Railroad conductors/yardmasters) report a double-digit spike.
- Electricians is the only occupation listed in both the Building Retrofitting and Mass Transit categories.
- Again, besides Civil Engineers, 2- and 4-year degrees are not required for these occupations. Six of them, in fact, require moderate on-the-job training, and three (Rail-track layers, Locomotive engineers, and Railroad conductors) have a median hourly earnings exceeding $20 an hour.
Assessing the Impact of “Green” Projects
In addition to the occupations listed in the PERI report and other details that have been released about the economic stimulus plan, the U.S. Conference of Mayors has come out with an exhaustive catalog of projects (download the pdf) that could be started right away in almost every American city. The list includes how much funding is needed for the infrastructure projects – everything from bridge improvements to paving roadways – and how many jobs are estimated to be created as a result.
With all these proposed projects, it’s important to assess the total economic impact to know which ones should have priority based on what industries will be affected – both directly and indirectly – and how much they will be affected. EMSI’s Economic Impact module provides users with the ability to run input-output scenarios for single industries or industry clusters. We plan to discuss these impacts in a future article.
Conclusion
We should know more about Obama’s economic recovery strategy in the coming months. In the meantime, the PERI report and the two categories we’ve looked at are good starting points to begin understanding what occupations will be affected.
With EMSI’s data, local planners and educators can easily see the demand for these occupations on a regional basis, as well as the earnings and education level required. For questions about this data or to get a look at how these numbers stack up for your area, feel free to contact us.
Again, keep an eye out for more installments in this series as we work through some of the implications of “green” economic and workforce policies.
