economic growth - The New School SCEPA
Much like the United States, the Brazilian government was slow to react to the virus, and Brazil joined us as one of the global epicenters of COVID-19 cases and deaths. New research shows that, also like the States, pre-existing inequities in living and working conditions along racial, educational, and class lines are at the root of the higher infection and mortality rates observed in low-income and non-white communities. The research also shows that without government aid, COVID exacerbates inequality.
Our ongoing video series, SCEPA Responds, brings together expert economists, professors, fellows, and research associates to discuss current economic issues and challenge economic doctrines that create systemic inequity. The series focuses on areas such as race, monetary and fiscal policy, and economic growth and crisis, to provide insights for working families, older workers, the working poor, minorities, and more.
Tackling climate change requires transitioning to a green, sustainable economy. But will green transformations that lesson our negative environmental impacts also create high-quality jobs? In a new report from the UN, economist Willi Semmler, director of SCEPA’s Economics of Climate Change project, and his co-authors demonstrate it is possible, but only if policymakers rise to the challenge.
While it’s difficult to quantify overall employment impact, available data shows increased environmental spending can create jobs. In the United States, estimates show that a 10-year green recovery program investing $100 billion in areas like mass transit and solar power would create millions of jobs. Results are also promising for other high-income countries. While data for developing countries is less clear, jobs in green sectors, like energy construction and waste management, are growing. Countries like Brazil, Lebanon, Morocco, and South Africa, where an agreement was signed in 2011 with the aim of creating at least 300,000 green jobs, have seen positive employment effects.
But to ensure sustainable economic transformations enhance the job market, the quality of jobs needs to be considered, not just the quantity. Because technological shifts will change labor demand and skill requirements across most industries, industrial policies must support employers in creating training systems that empower workers as they take on new jobs or fulfill new assignments. Public employment services must help job seekers change sectors, while education reform is necessary to ensure young workers can enter the labor market.
The shift to a greener economy must also offer opportunities for small firms and startups to innovate and lead the way. Improving access to credit, for example, can promote self-employment and entrepreneurship. Introducing revenue-neutral green taxes can force a movement of labor to greener sectors and create jobs. Finally, an open dialogue and cooperation between governments and interested parties, such as trade unions, are essential to ensure these changes go smoothly.
While a greener economy can create high-quality jobs, it will not do so automatically, but must be supported by social and labor policies that reduce the burden of the transition to a low carbon economy, and promote efficiency and equity.
“Enhancing Job Creation Through Green Transformation” by Michela Esposito, Alexander Haider, Willi Semmler, and Daniel Samaan appears in Green Industrial Policy: Concept, Policies, Country Experiences, published by the Partnership for Action on Green Economy, a U.N. Environment Programme initiative, in partnership with the German Development Institute. Daniel Samaan is a New School PHD and a senior researcher at the U.N.'s International Labour Organization, and Alexander Haider is a current New School PHD student.
This paper explores how climate damage affects the long-run evolution of the economy.