January 18, 2009

More on Green Jobs

Solar Panel install
Originally uploaded by richardmasoner
One argument against green jobs, at least from the economic perspective, is that one of the perceived virtues of projects like renewable energy production and energy-efficient building retrofits -- that they are relatively labor-intensive, and thus would employ more people than would the oil, coal, and gas industries -- is in fact a big drawback: all else being equal, you want to maximize labor productivity, the amount of economic output generated per unit of labor, rather than minimize it. The fact that the oil industry, for example, produces the same amount of energy with fewer workers than the solar industry, may not be so good for job-seekers, but it's good for the economy as a whole -- at least in the sense that it reduces the labor costs of the energy produced.

With unemployment currently at 7.2% and rising, that's an argument that may not find much support -- getting people back to work, by hook or by crook, is rightly the more pressing concern. Yet it's one that needs to be addressed as we exit the recession and try to develop cleaner sources of energy in the long run.

One point I would make is that any discussion of the relative costs of fossil fuels and renewables needs to price in the externalities of releasing massive amounts of carbon dioxide into the atmosphere -- i.e., global warming. Oil may be less labor-intensive than solar, but that advantage is likely offset by the harm that oil production inflicts on our climate over time. Obviously, once you throw in all the various subsidies that various energy sources receive, not to mention the ecological problems found even with renewable energy, the cost-benefit analysis will shift around; but that kind of broadened perspective is necessary before you can make any kind of judgment about the merits of one kind of energy regime over another. This also underscores the necessity of getting the prices right as a prerequisite to creating a low-carbon economy, where the labor-intensive nature of some renewable energy sources is not such a sticking point.

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