Lawrence Solomon: Green jobs cost jobs

Lawrence Solomon

Green jobs will grow the unemployment rolls, concludes a study at Juan Carlos University in Madrid. Every green job created ploughs under 2.2 jobs elsewhere in the economy, and that doesn’t account for the indirect job losses to come of the higher energy prices that accompany green energy technologies: Companies can be counted on to flee this green, or should we say gangrene, economy.

The author of the study, economist Gabriel Calzada, has rich data to mine: Spain has few equals in trying to coerce renewable technologies into the energy marketplace. To bring these immature technologies to market, for example, Spanish regulators lavish Spanish renewable energy producers with payments that can be 11 times greater than those who produce conventional power.

Calzado’s analysis of the green jobs that Spain created since 2000 shows that each green job created cost an average of 571,000 euros, or almost $1-million. “The money spent by the government cannot, once committed to “green jobs”, be consumed or invested by private parties and therefore the jobs that would depend on such consumption and investment will disappear or not be created,” the study says.

Put another way, government spending on renewable energy is less than half as efficient at job creation as private-sector spending.

The result: Rather than being a boon to Spanish workers, green jobs have been a bane: Spain’s jobless rate now stands at 14%. The windmill lobby thrived and those windmills whirred, mowing down jobs as never before.

Green jobs based on top-down subsidies are, of course, unsustainable. The Spanish government has recently had to reduce its subsidies to solar by 30%, the green industry is now in retreat, and green jobs, too, are being lost by the tens of thousands. The lesson should be clear to all who care about the environment: Don’t force green technologies to perform before they’ve matured. Be patient and grow the energy economy organically, without artificial subsidies and from the roots up.

Lawrence Solomon, March 31, 2009

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