Will Boris’s green jobs plan really create 250,000 jobs?

Industry experts warn that funding cuts and an inconsistent approach have bedevilled efforts to green the economy

Green money

Boris Johnson may have pledged to create 250,000 new “green” jobs for the UK over the next decade, but experts insist the first priority is repairing the damage of recent years where the rhetoric of environmental ambitions has been belied by the reality of slashed support.

The latest Office for National Statistics figures show the UK’s low-carbon and renewable energy economy - spanning everything from energy efficient products to low emission vehicles and off-shore wind - accounted for 224,800 jobs in 2018, up from 200,800 three years earlier. 

But compared to 2014, employment is 10,000 lower. According to the Renewable Energy Association (REA), the sector has suffered from the cutting or removal of subsidies that offered a route to market against the competition of cheaper fossil fuels.

Examples include the end of the “feed-in tariff” last year, which paid households for unused energy generated by solar panels or wind turbines put back into the grid. Further back in 2015 the scrapping of the “renewables obligation” for large-scale projects - in existence since 2002 and funded by household bills - also hit jobs.

REA policy director Frank Gordon said ending of feed-in tariffs cost as many as 10,000 jobs in the solar energy sector alone. “The story of the last two or three years has been a lot of Government plans and rhetoric but flatlining employment. We welcome the direction of this announcement but there has been a lot of damage done in the last few years which needs to be repaired.”

This message was underlined by the Committee on Climate Change’s report to Parliament in June that highlighted that “policy has been withdrawn with minimal notice, or functioning schemes have been scrapped”. That is bad for investment and jobs.

However, the REA estimates there could be 238,000 more jobs in renewable energy and clean technologies by 2030 - including more than 46,000 jobs in the North - if the Government is willing to support the sector through tax moves such as business rates relief for green energy projects.

Such a potentially unpopular move has been repeatedly dodged by chancellors for more than a decade.

Cambridge Econometrics in a study released earlier this month suggested that bringing forward the banning of diesel and petrol cars to 2030 could create an extra 32,000 jobs. 

Yet questions remain over the size of the spend. The initial £4bn package is intended to “mobilise” an extra £12bn in public investment and potentially three times as much private investment up to 2030, but bodies such as the Institute for Public Policy and Research call for an additional £33bn a year alone.

Meanwhile 250,000 new jobs may sound impressive, but the number amounts to less than 1pc of the UK's 33m workforce. 

One key plank of the jobs promise is an extra 50,000 jobs making homes, schools and public buildings more energy efficient by 2030. Noble Francis, chief economist at the Construction Products Association, points out that this is small beer in the context of a construction industry that employs 2.1m people. So too the nuclear plans to support a further 10,000 jobs.

Francis points out that construction employment stands 250,000 below the beginning of 2019 thanks to Covid, while the sums this week will barely scratch the surface of what is needed to retrofit the 75pc of the UK’s 29m homes built before 1980. That would swallow the £4bn and more all on its own.

“The problem we find with government plans is that they are not plans, they are wish-lists. Unless we see the details, it is impossible to know how many jobs will be created," he says.

For Mark Littlewood, the director of the Institute for Economic Affairs, the government pump-priming of the green revolution amounts to an unsatisfactorily high £48,000 per job created.

He sees the lack of action on tax as the gaping hole in the plans, and rather than outright bans says a realistic carbon price is the preferable option.

Littlewood warns: “Tax is really the only lever they need to pull. We need to find a fair price for carbon and then allow the market to find whatever solutions they find. It’s far, far better than this dirigiste approach.”