Job creation was a decisive factor in the recent election. But the question of how to create jobs rarely has been answered well.
Republicans and Democrats both value job creation and retention. If broad new programs were known they could have been implemented any time since the recession of 2007-9 (or even earlier when job creation tanked in the years 2000-2007 and manufacturing jobs were disappearing at their fastest rate ever [or since]). The fact that they mostly were not shows that good ideas were lacking.
Energy efficiency policies are much narrower in scope than the ideas that most economic policy analysts have considered to create employment. But they have the potential to produce new jobs at scale. I published a paper in Electricity Policy that sets forth new policy initiatives for infrastructure investment that will increase economic growth and reduce costs, especially for middle-class working households and for the poor. I wrote the paper with the goal of limiting climate change to a temperature increase of 1.5 degrees Celsius. Yet this suite of policies is also the most effective economic development proposal that has been set forward.
The first step is to continue and accelerate clean energy investment policies that are working well: energy efficiency policies that already are responsible for over 2 million jobs, and renewable energy promotion policies that have already produced 400,000 jobs. And efficiency policies have produced over $5 trillion in net savings.
The next step described in the paper is to adopt six new programs for enhanced energy efficiency and reducing of emissions of other greenhouse gases:
- Fast, deep energy retrofits of all buildings
- Smart growth and shared mobility
- Strategic Energy Management in industry
- Saving emissions in the supply chain
- Improving forestry
- Reducing methane leaks
The first efficiency policy alone is capable of generating some 500,000 new permanent jobs, focusing on the weakest sector of the American economy—construction.
Other new policies are designed to improve manufacturing competitiveness, helping us increase manufacturing jobs by accelerating the deployment of new technologies in manufacturing that reduce costs and increase productivity while cutting pollution. This sort of increase in manufacturing competitiveness leads to expansions of manufacturing as well as keeping existing plants open.
I grew up in what we now call the Rust Belt so I witnessed, beginning in the 1970s, the shuttering of manufacturing plants that for decades had employed thousands at high wages. The reason for the closings was evident even to a teenager: the plants suffered from obsolete technology that had not been updated for at least 40 years. They had become increasingly uncompetitive over the years, all the while polluting the air so badly that I could never see things farther than a few miles away. We used to joke then that it was a shame American industry wasn’t bombed into oblivion like German and Japanese factories so that we could have rebuilt them with cleaner and more productive technology.
Increasing energy efficiency through better management systems and new technology, along with better operations, could have preserved the steel and oil refining and car manufacturing jobs that were the mainstay of the local economy in the 50s, while cutting costs and pollution. They could have done this by requiring the plants to improve their operations continually, investing in efficiency of energy use as well as overall efficiency of production.
Now we have the opportunity to do this on an economy-wide basis, increasing economic choices for the middle class while reducing costs.
We have the technology and know-how to rein in climate change at a profit. In so doing, we can put millions of Americans to work where they live, with good middle class jobs, while making America stronger and more competitive globally. We just need to choose to do so. And environmental motivations might be just enough to get the ball rolling.