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What Makes Jobs Green?

February 03, 2010 By Nathan Paine, Fellow

As Minnesota and the rest of the country move toward a sustainable economy, there has been a lot of talk about "green jobs."  So, what is a green job?  The short answer is that we don't know.  Identifying green jobs has been problematic, as we will see.  The goal here is to given a longer, more considered answer that will advance Minnesota's public policy.

It is important to identify green jobs because the U.S. and Minnesota policy makers are relying on an alternative energy economy to revitalize the manufacturing sector, spur innovation, and achieve long-term economic growth.  This public policy is an important element of the American Recovery and Reinvestment Act of 2009.  The Act includes federal tax cuts and domestic spending to promote alternative energy investments in the energy sector.  In Minnesota, we want to be able to count jobs to inform data driven policies to create jobs.  Defining green jobs is also important for workforce development and training in Minnesota - a consensus definition will ensure that green certificate training programs provide skills training that matches to the needs of green jobs.  Green certificate training programs will also be more effectively integrated to existing job training programs.  From an environmental perspective, precisely defining green jobs and green businesses is important to avoid green-washing "dirty" industries.

The 2008 report, The State of Green Business, states there is no common, accepted definition of green jobs.  This makes counting the number of green businesses, and green jobs very difficult.  It also means that there is no definitive number of green businesses and green jobs.  Most agree that we should classify businesses that produce environmentally friendly products and services as green.  But how far up the supply chain do we go?  Is producing steel for a wind turbine a green job?  What if 95% of the steel produced is used by the construction and automobile industries?  However, should we also classify businesses that use environmentally friendly practices as green?  For example, should Burger King be considered a green company if it employs energy efficient appliances and lighting?  What if Burger King also purchased its meat products from sustainable farming operations? 

Defining green jobs is just as difficult.  Some experts define green jobs as blue collar jobs in green businesses.  Phil Angelides, chair of the Apollo Alliance, defined a green job as one that can support a family through decent wages and benefits in addition to improving environmental quality.  In a December 2008 New York Times article, Carl Pope, executive director of the Sierra Club, said that "a green job has to do something useful for people, and it has to be helpful to, or at least not damaging to, the environment."  Most would agree that cutting and grinding gears for wind turbines is a green job.  But what if the same worker produces gears for the automobile industry and other "dirty" industries?  Most gear manufacturers serve multiple industries.  Does the proportion of business from serving green industries matter when talking about green jobs and green businesses?  Should white collar jobs in green businesses be counted?

The lack of a common, accepted definition of green jobs and green businesses makes counting problematic.  Take form example two recent studies: one by the U.S. Conference of Mayors and another by the American Solar Energy Society.  The U.S. Conference of Mayors calculated that 751,051 green jobs exist.  The American Solar Energy Society stated that 8.5 million green jobs exist.  This is a great example of how estimates of green jobs will vary widely based on the definition. 

This example also illustrates why defining green jobs has immense practical purpose.  This is even more so because data driven decisions about policy connecting energy policy to job creation is sorely needed at this point to avoid handing the American people a hoax.  Further debate is needed about the necessary and sufficient conditions for counting a job or business as green.  It is important that consensus definition be developed so that careful analysis linking energy policy and job creation can move forward. 

A 2008 report, Green Recovery, by the Center for American Progress and the Political Economy Research Institute is a good starting point for a consensus definition of green jobs and policy research linking energy policy and green jobs.  The Report identifies occupations in six different alternative energy and energy efficiency investment areas.  The six different green economic investment areas are:  (1) Building Retrofitting; (2) Mass Transit/Freight Rail; (3) Smart Grids; (4) Wind Power; (5) Solar Power; (6) Advanced Bio-fuels.  Table 1 below lists representative occupations associated with the green economic investment strategies put forth by the Center for American Progress and the Political Economy Research Institute. 

It is important to realize that these green investment areas will also employ people in other occupations that provide supporting services, including accountants, lawyers, retail sales people, human resources people, etc.  For example, developing a wind project requires the services of lawyers, accountants, bankers, people in the insurance industry, etc.  By implication, the Center for American Progress and the Political Economy Research Institute have defined green businesses as producing goods and services that have a direct impact on environmental quality.  A law firm would not be classified as a green business even if it provides support services for renewable energy projects because the support services only have indirect impact on environmental quality.  Importantly, the listed occupations do exclude workers that perform professional office, administrative, and sales coordination tasks even if these workers are employed by green businesses.  However, the listed occupations do include workers that do not fit the traditional white collar and blue collar molds.  Chemists, engineers, agricultural and forestry supervisors are just a few of the listed occupations that do not involve manual labor.  The implication is that employment in a green business is neither a necessary nor sufficient condition for a green job.  In sum, a green job involves the performance of activities that are directly associated with the production of a good or service that directly improves environmental quality.  Support services (e.g. human resources), whether provided in-house or through vendors, are not classified as a green job.  

There are other wrinkles that need to be debated, such as how to classify suppliers to multiple industries.  However, we have taken a step toward a more precise, functional definition of green collar jobs.  A green business is a company that produces products are services that directly improve environmental quality.  A green job involves the performance of activities that are directly associated with the production of a good or service that directly improves environmental quality.  Employment in a green business is not a necessary or sufficient condition for a green job.  This definition is more functional and precise than simply defining a green collar job as a blue collar job in a green business.

 

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