How green are the green jobs in Budget 2023?

The following is a re-print of the March 2023 edition of Shift Storm, the CCPA’s monthly newsletter which focuses on the intersection of work and climate change. Click here to subscribe to Shift Storm and get the latest updates straight to your inbox.

The federal government delivered one of its biggest climate budgets ever on Tuesday, with $60 billion in new climate-related spending. That’s a real investment in climate action—with some big caveats.

Almost all of that money is being handed out to corporations as tax breaks instead of the government investing directly in emission-reducing, job-creating, welfare-enhancing projects. As I argued in an op-ed for the National Observer, it’s a concerning abdication of government leadership in spite of the headline dollar figures.

To make matters worse, several of these tax breaks—like, $35 billion worth—target hydrogen and carbon capture technologies that are likely to subsidize the continued production and consumption of fossil fuels.

You can read more budget analysis from the CCPA and our allies here, but let’s take a moment to talk about the implications for workers. On that front, there’s good news and bad news in this budget.

One of the biggest wins is the inclusion of labour conditions on these new tax credits. If a company wants the full refund, they need to pay at least the “prevailing wage” (specifics to be determined) and employ a certain share of apprentices. Elsewhere, the budget promises legislative changes to prohibit “replacement workers” (scabs) during union strikes and lockouts. These measures will serve to strengthen unions and ensure decent work in the clean economy.

On the other hand, the labour conditions only apply to certain credits and employers can ignore them anyway if they’re willing to accept a lower subsidy. And while a wage floor is a welcome step, the budget ignores other important considerations for building an inclusive economy.

Armine Yalnizyan excoriated the budget for its failure to recognize and support women in the economy. Nowhere is that more true than on the clean economy side—where attracting more women into the skilled trades and related professions is both an equity and economic issue. Same goes for Indigenous workers, racialized workers and immigrants, all of whom need to be brought into the fold with deliberate workforce development policies. Not only is it the right thing to do, but it is essential for the country to address looming skill shortages.

There’s also the small matter of a three per cent across-the-board spending cut for government departments and agencies, which is almost certain to impact the number of jobs, the quality of public services, or both. Unions representing public services workers are, rightly, up in arms.

I can’t help but wonder what Carla Lipsig-Mummé would make of it all. Carla sadly passed away in January after a distinguished and groundbreaking career focused on issues of worker justice. She was the driving force behind the SSHRC-funded project that kickstarted this very newsletter. You can read more about her achievements here.

In this month’s newsletter, which is dedicated to Carla and her legacy, we explore the relationship between climate action and green jobs in Canada and around the world. Let’s dive in!

Storm surge: this month’s key publications

Latest IPCC report a wake-up call—yet again—for urgent and transformative climate action

The Intergovernmental Panel on Climate Change’s 6th Synthesis Report is the culmination of nearly a decade’s work by thousands of climate scientists from around the world. It is the definitive summary of the climate crisis and of the actions needed to tackle it. The Summary for Policymakers is required reading.

We won’t get into the details here, but suffice it to say that climate change is already destabilizing the planet and is on track to get much worse without rapid economic (and political) changes. For more, check out the responses from Environmental Defence, Stand.earth, Greenpeace and Climate Action Network (CAN-Rac).

For our purposes, one of the key takeaways from the IPCC report is that prioritizing “equity, inclusion, just transitions… [and the] meaningful participation of all relevant actors in decision making” actually accelerates emissions reductions. Too often, governments and the private sector frame climate action as a trade-off between jobs and the environment. In reality, as the IPCC notes, putting people first builds the social trust necessary for transformative changes. Canadian governments take note.

Canada’s net-zero transition will create 700,000 more jobs than it eliminates

A new report from Clean Energy Canada and Navius Research, A Pivotal Moment, finds that the transition to a net-zero economy in Canada could create roughly 2.2 million green jobs between 2025 and 2050 while eliminating 1.5 million jobs connected to fossil fuels. That’s a net gain of 700,000 jobs. And while the decline in fossil fuel–related employment will be concentrated in the regions that depend on those industries today, such as Alberta and Newfoundland and Labrador, those regions are still slated to see a net increase in clean jobs. Alberta, in fact, is projected to experience the fastest growth in green job creation in the coming decades.

There’s a big caveat here—which is that the CEC and Navius projections assume governments lean into the green economy. As the report points out, in a scenario where governments roll back key climate policies, such as carbon pricing, we end up with fewer jobs overall by 2050. That’s because job loss in the fossil fuel sector is largely out of our control. Indeed, the report expects oil sands employment to decline by at least 93 per cent by 2050 due to global market forces. Green job creation, on the other hand, is not a foregone conclusion. Governments need to invest in (or, as this latest budget aims to do, create the conditions for private investment in) the industries that will drive long-term job creation.

Unfortunately, for a report so focused on jobs, A Pivotal Movement pays too little attention to supporting displaced workers—1.5 million of them, apparently—and their communities. The report also glosses over two major challenges for a just transition: (1) that green jobs are often less desirable than the fossil fuel jobs they are replacing due to lower pay, lack of unionization and other factors, and (2) that new green jobs will not necessarily be created in the same communities where fossil fuel jobs are lost. For example, it may come as little consolation to a former coal miner in Hinton, Alberta, that they have a job available 300km away in Edmonton.

Canada trails OECD in green job creation

Speaking of green jobs, Canada has a lot of catching up to do. In Bridging the Great Green Divide, the Organisation for Economic Co-operation and Development offers a robust framework for defining green jobs, new data breaking down green jobs by country, and a useful set of recommendations for governments trying to make the most of green job creation in the coming years. (The PDF is paywalled but you can read the full report for free on their website.)

Among the 30 countries included in the study, I was surprised to see that Canada has the lowest share of what they call “green-task” jobs today—only about 12 per cent of the workforce. That’s slightly worse than peer countries like the U.S. and Australia, but significantly lower than the majority of northern European countries where closer to a quarter of jobs meet the OECD’s green job criteria.

What to do about it? The OECD’s first recommendation happens to be the same recommendation we made in Bet Big, the CCPA’s recent report on green industrial policy: develop a long-term vision and strategy for economic transition. It is hard to overstate the importance of a clear goal, and that is precisely what the latest federal budget fails to establish. Depending on who you ask, Canada’s fossil fuel industry will either collapse before 2050 or Canada will be the last oil and gas producer standing. These contradictory visions—both of which are held by federal leaders—is a recipe for bad decisions by the private sector, other levels of governments, and by workers and communities who just want to plan for the future.

As an aside, the OECD report acknowledges the dramatic underrepresentation of women in green jobs—women account for just 28 per cent of workers in green jobs overall and less than 20 per cent in Canada—but the analysis does not consider other categories of marginalization. That’s not particularly surprising from the OECD, but as previous CCPA research has found, the underrepresentation of racialized workers, immigrants and other marginalized groups in the clean economy should be of much greater concern to Canadian governments.

Scottish oil workers present bold vision for a just transition

A coalition of oil and gas workers, labour unions and environmental groups in Scotland has published Our Power, a brilliant report with a raft of lessons for Canadian workers and environmentalists alike.

First, the report is the product of a worker-led process that involved a series of workshops, conversations and surveys with offshore oil workers. By starting with worker concerns, rather than trying to fit worker concerns into a pre-existing environmental policy framework, the process produced a set of recommendations that the vast majority of Scottish oil workers support. That’s essential for making climate action durable.

Second, the coalition sets its sights on the power of the oil and gas industry. Too often, fossil fuel companies and the governments that go to bat for them succeed in pitting workers and environmentalists against one another. But Scottish workers and environmentalists recognize that the biggest obstacles to prosperity and sustainability are the oil companies, not each other.

Third, the report’s recommendations move beyond short-term instrumental concerns to consider the broader challenge of building a just and sustainable economy. The coalition’s demands do include traditional just transition priorities, such as support for retraining, but they go on to push for more radical propositions, such as public ownership over climate solutions and a complete reorganization of the tax system to better support public priorities.

This big picture thinking—a “wholesale reimagining of the energy industry” as the report puts it—is how real change starts.

Research radar: the latest developments in work and climate

How badly does Canada need to compete with the U.S. on clean tech? The passage of the U.S. Inflation Reduction Act and its extensive clean tech subsidies have spurred much hand-wringing in Canada about competitiveness, but as two new reports point out, it’s not always that simple. In Creating a Canadian Advantage, Bentley Allan and Michael Bernstein at the Transition Accelerator find that Canadian clean tech competitiveness varies widely depending on the specific technology in question. In Seven recommendations to leverage public investment to help Canada compete in the global energy transition, Marisa Beck, Dale Beugin and Calvin Trottier-Chi at the Canadian Climate Institute find that competitiveness rests on more than the dollar value of subsidies—a coherent clean tech industrial strategy is just as important. Together, the reports provide a welcome dose of nuance to a heated topic and are useful background for understanding the federal budget’s new tax incentives.

Climate taxonomy lays groundwork for determining clean vs. dirty investments. One of this month’s most esoteric reads may yet prove to be the most consequential. The Sustainable Finance Action Council—a body that was convened by the federal government in 2021 to “help lead the Canadian financial sector towards integrating sustainable finance into standard industry practice”—presented its Taxonomy Roadmap Report to the government of Canada, which attempts to define the types of investments that should count as “sustainable.” As billions (and potentially) trillions of dollars of private capital flow into the clean economy in the coming years, having the “sustainable” label could make-or-break certain technologies and industries. The problem? Various oil sands-related investments, including blue hydrogen and carbon capture, make the cut. As Environmental Defence’s Julie Segal points out, that’s “not actually transition.”

U.S. communities forced to step up where government transition plans fall short. The U.S.-based Labor Network for Sustainability has started a new series called Protecting Workers and Communities–From Below. Their first installment, “On the Ground,” looks at four case studies of coal plant closures and their impacts on local communities. The unfortunate common thread is the failure of governments to proactively and sufficiently support workers. The silver lining is the tendency for hard-hit communities to come together in times of struggle to support one another. Stay tuned for upcoming CCPA research tackling this very issue.

EU foregrounding workers in clean industry push. The European Union has proposed a Net-Zero Industry Act that, among other priorities, places an emphasis on skills development and quality job creation. If passed, the act would create Net Zero Industry Academies to provide training and credentialing for a variety of in-demand occupations. The act also puts an emphasis on forecasting future skills needs, so that workers can be trained today for jobs that will be created in the future. Thinking ten years ahead is crucial for workforce development but something that we are doing a poor job of in Canada.

20 million fossil fuels jobs at stake in India’s green transition. One of the most populous countries in the world is confronting a transition challenge unlike anywhere else as it embarks on a “phase down” (though not a full phase out) of coal power. In its Just Transition Framework for India, the International Forum for Environment, Sustainability & Technology draws on lessons from around the world to develop a just transition plan that will meet the scale of the problem. It’s a smart and comprehensive plan that reflects the maturity of the global just transition conversation, but it is ultimately limited by India’s commitment to indefinite fossil fuel use. In related news, a report from the Grantham Research Institute at the London School of Economics, Just Finance India, offers 10 recommendations for how to get the private sector to help pay for this massive transition.

Moving from consultation to deep engagement in Scotland’s just transition. The London-based Royal Society of Arts published Rural and post-industrial perspectives on the just transition, which recounts and draws lessons from a series of workshops about energy transitions held in the Scottish regions of Fife and Dumfries. Direct engagement with workers and communities is essential for a truly just transition, and while similar work has been undertaken in Canada in the past, we lack a robust and ongoing process for engagement with the people most affected by climate policies—something the new Sustainable Jobs Plan will hopefully remedy.

Static charge: monthly multimedia insights

What Alberta coal communities are saying about a just transition. The always-thoughtful Energy vs. Climate podcast set its sights on workers in a recent episode titled “Just Transition.” The podcast interviews Doray Veno, an organizer in Hanna, Alberta, who is helping her community to transition away from its historical dependence on the coal industry.

Green industrial policy has quietly gone mainstream. The Toronto Star’s It’s Political podcast discusses green industrial policy with a star-studded lineup—including Unifor president Lana Payne and industry minister François-Philippe Champagne—for its episode called “Subsidizing big business.” It’s a helpful overview of current thinking on the topic, but in focusing so narrowly on corporate subsidies it undersells the potential of a more ambitious, state-led industrial policy.

The promise of sustainable jobs depends on proactive training. Over on the Green Majority podcast, I speak with host Stefan Hostetter about the ups and downs of the new Sustainable Jobs Plan for their episode titled “Canada’s Dull Mind.” I emphasize the importance of long-term thinking when it comes to skills training.

The movement for a Youth Climate Corps is heating up. In case you missed it, you can watch the recording of the Climate Emergency Unit’s event, “Everyone Has a Role to Play.” It’s got bold ideas, great speakers and special musical guests.

That’s it for this month! My thanks again to Danielle Matta, Jon Milton and the rest of the CCPA team for making this newsletter possible. If you found it helpful, tell a friend or a colleague to subscribe. And if you think we missed something or have any other feedback, please get in touch with your suggestions.

Until next time…