NCPA - National Center for Policy Analysis

GREEN JOBS: MYTHS VS. FACTS

March 20, 2009

Academics and researchers from four U.S. universities recently released a joint study, "Seven Myths About Green Jobs."  The analysis looks at widespread claims of green jobs and the new green economy and their potential impact on the economy, employment and the environment. 

Here's a taste:

  • Myth 1: Everyone understands what a "green job" is.
  • Fact 1: No standard definition of a "green job" exists.

According to the studies most commonly quoted, green jobs pay well, are interesting to do, produce products that environmental groups prefer, and do so in a unionized workplace.  Such criteria have little to do with the environmental impacts of the jobs.  To build a political coalition, "green jobs" have become a mechanism to deliver something for members of many special interests in order to buy their support for a radical transformation of society.  Committing hundreds of billions of dollars to promoting something lacking a transparent definition cannot be justified.

  • Myth 2: Creating green jobs will boost productive employment.
  • Fact 2: Green jobs estimates in these oft-quoted studies include huge numbers of clerical, bureaucratic, and administrative positions that do not produce goods and services for consumption.

These green jobs studies mistake any position receiving a paycheck for a position creating value.  Simply hiring people to write and enforce regulations, fill-out forms, and process paperwork is not a recipe for creating wealth. Much of the promised boost in green employment turns out to be in non-productive - and expensive - positions that raise costs for consumers. These higher paying jobs that fail to create a more eco-friendly society dramatically skew the results in both number of green jobs created and salary levels of those jobs.

  • Myth 3: Green jobs forecasts are reliable.
  • Fact 3: The green jobs studies made estimates using poor economic models based on dubious assumptions.

The forecasts for green employment in these studies optimistically predict an employment boom that will take us to prosperity in a new green world. The forecasts, which are sometimes amazingly detailed, are unreliable because they are based on:

  • Questionable estimates by interest groups of tiny base numbers in employment,
  • Extrapolation of growth rates from those small base numbers, that does not take into consideration that growth rates eventually slow, plateau and even decline, and
  • A biased and highly selective optimism about which technologies will improve.

Moreover, the estimates use a technique (input-output analysis) that is inappropriate to the conditions of technological change presumed by the green jobs literature itself. This yields seemingly precise estimates that give the illusion of scientific reliability to numbers that are actually based on faulty assumptions.

Source: Andrew P. Morriss et al., "7 Myths About Green Jobs," University of Illinois, Law & Economics, Working Paper No. LE09-007, March 11, 2009.

For text:

http://papers.ssrn.com/sol3/papers.cfm?abstract_id=1357440 

 

Browse more articles on Environment Issues