Hire fast, fire slow: the employment benefits of energy transitions

Abstract

The transition towards decarbonized and efficient energy systems has broad socio-economic implications. We estimate the potential impacts on employment from efforts in energy efficiency in industry, transport and buildings as well as substituting local renewable energy sources for fossil fuels. Both energy supply and demand are accounted for. We use a hybrid approach that combines national energy transition scenarios with input–output tables, adjusted for new energy and non-energy activities. We conclude that the transition has a net positive impact on employment as illustrated by the case of Switzerland. The local and decentralized nature of energy efficiency and renewables retains a greater share of value-added domestically than does a supply chain of fossil fuels. Moreover, we find that more jobs are created in demand-side activities, such as building renovation, than in renewable energy generation. Positive impacts on jobs from spillover effects in all non-energy activities are also found.