Decarbonisation will have implications across different sectors for the number and types of jobs available. It is expected that these effects will be felt unevenly across and within countries.
This paper aims to illustrate where different ‘decarbonisation dynamics’, such as the decline of fossil fuel use and modal shifts in transport, could be most acutely felt.
Our hope is that by highlighting areas that could be at risk of being ‘left behind’, national and local governments can ensure that plans are in place, so they are well positioned to benefit from the green jobs revolution.
- Like automation, decarbonisation will have different implications across sectors for the number and types of jobs available.
- ‘Decarbonisation dynamics’ are set to shape local labour markets in the next 10-30 years. We focus on three sectors that will play a critical role in reducing the UK’s greenhouse gas emissions and are expected to decline or transform as a result: fossil fuels and energy production, heavy industry, and vehicle manufacturing.
- There is clear variation across nations and regions, with London and the South having the lowest share of jobs impacted across all the industries that we consider. Jobs in the North, Midlands, Scotland and Wales will be more significantly impacted by these different ‘decarbonisation dynamics’ but the impacts will be felt most acutely in a handful of local areas.
- Jobs in fossil fuel and energy production are most concentrated in local authorities across Scotland, the north and midlands. Some of these areas already have high renewable energy capacity but, in many areas, workers may lack sufficient opportunities to transition into green jobs. Only half of the areas with the top 20 highest concentration of employment in these industries are in the government’s priority levelling up category.
- Jobs in heavy industry are most concentrated in parts of northern England, the Midlands and Wales. These jobs could be impacted by shifts to a circular economy as well as whether uncertain new technologies – like carbon capture, utilisation and storage and low carbon hydrogen fuels – reach maturity in time. Only half of the top 20 areas are in the government’s priority levelling up category.
- Jobs in vehicle manufacturing are most concentrated in parts of the Midlands and Wales. These jobs will be impacted by changes in manufacturing processes which will require different skills and may be less labour intensive as well as modal shifts in transport. Less than half of the top 20 areas are in the government’s levelling up priority category.
- These challenges do not provide sufficient rationale to slow down the decarbonisation of the economy, but policy-makers must ensure that plans are in place so that workers in these areas are well positioned to benefit from the green jobs revolution or find work in other growing sectors.
- We put forward two main recommendations for policy-makers. Firstly, that the UK government should create a just transition fund to support local authorities with the highest share of employment in industries likely to be impacted by decarbonisation. This fund could be used to support green job creation or economic diversification. Secondly, that local authorities be given the means to pilot job security councils, which would provide workers at risk of displacement with an end-to-end transition service. This should include experiments with new approaches to welfare such as transitionary basic income.
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