‘Severe implications’: Can the UK prevent a worsening green skills crunch?

'Severe implications': Can the UK prevent a worsening green skills crunch?

Extensive review of existing green jobs research and data explores key barriers to growth in UK’s green jobs market

For a good while, the government was big on green jobs. Former Prime Minister Boris Johnson even put a figure on its aspirations, pledging to create two million green jobs by 2030 through the various measures set out in the 2021 Net Zero Strategy. And the concept continues to kick about in Department for Energy Security and Net Zero (DESNZ) press releases, even if it is less frequently aired by Prime Minister Rishi Sunak. 

Nevertheless, Prime Minister Sunak and his Chancellor Jeremy Hunt have inherited Johnson’s green jobs mission. And target or not, the size of the UK’s green workforce is shaping up to be a major indicator of the country’s economic health. The race to capture the green industries of the future is now firmly underway after the launch of generous new clean energy and technology subsidy programmes in the US and the EU. The UK’s ability to play a leading role in those industries depends on many factors, but arguably few are as important as having a skilled workforce to power them.

Green jobs, therefore, remain an economic priority for the government. But it does not take an expert to conclude the UK is a significant uphill battle to fill the growing number of green jobs that are being created. The labour market is in poor shape generally, with vacancies surging to an all-time high in recent years as the supply of workers has been hit by the twin impact of Brexit and pandemic. 

Yesterday’s Budget did not mention green jobs explicitly, but it did place significant focus on skills training and the importance of capturing the market for “green industries” and making the UK a “technology and science superpower”. Picking education as one of four themes, Hunt stressed the government wanted to ensure individuals had the knowledge and skills to get the jobs they wanted and that are required for a “high skill, high wage economy”. While he did not mention the mass teacher strikes and chronic teaching recruitment crises disrupting children’s learning nationwide, he did stress it was his priority to get as many people back to work as he boosted childcare allowances and announced controversial reforms to pensions tax to try and discourage high earners from taking early retirement.

He also touched on why such measures were needed, revealing there were currently one million vacancies across the UK economy.

But what is the current state of green jobs in the UK? It is a difficult question to answer, given the various definitions of what a green job is. By some counts, any job in an industry that is playing a significant part in decarbonising the economy or has limited climate impact is green. Other researchers take a more granular approach, assessing at the characteristics of specific jobs to determine whether the tasks and activities it involves are green. A third way to measure green jobs to count any role connected to the creation of green jobs and services within an organisation.

The patchy and limited nature of research into green jobs presents a challenge to policymakers and businesses looking to prepare workers for a future dominated by clean energy technologies. Should they work on creating green jobs, or boosting demand for green jobs? A supply-side strategy will have little effect if there is little demand for jobs, and vice versa.

This morning, innovation charity Nesta’s Behavioural Insights Team published a major new report that attempts to cut through the noise, so as to help policymakers decide on the most effective courses of actions to drive growth in the green jobs market. Parsing through a trove of research and data produced by consultancies, think tanks, pollsters, LinkedIn, academics, and the Office for National Statistics, the organisation has concluded that the most significant barrier to green jobs is not availability of jobs, but a widespread lack of the right skills. “Despite the multitude of barriers affecting green jobs, we believe the most significant barrier relates to the ability to perform green jobs, given the deficit in green skills across the UK’s workforce,” the report concludes.

As such, it recommends that policymakers focus much more on demand-side interventions designed to improve the workforce’s ability to take on green roles. A failure to pre-empt green skills shortfalls, the researchers warn, could carry “severe implications”, including unemployment, underemployment, and further damage to the country’s already poor productivity rates.

The researchers’ conclusion that a skills deficit is set to be the biggest challenge for the green jobs market is not wholly unsurprising, given the general infirmity of the UK’s labour force. According to current projections, the UK will have a shortfall of 2.6 million workers by 2030, with employers across the UK repeatedly highlighting skills shortages as the major barrier to recruitment in government surveys. Shortages are felt most acutely in many of the fields required for green jobs, Nesta notes, pointing out the UK ranks 30th out of 38 OECD countries when it comes to studying engineering, manufacturing, and construction. A shortfall of candidates with STEM skills is hurting the whole of the economy, meaning companies looking for workers to fill many green job roles are likely to face fiercer competition, it notes.

Notably, the report posits that low confidence in future uptake of clean energy technologies could be dampening workers’ interest in reskilling or upskilling to be able to deliver those technologies. Recent research highlighted that a significant barrier preventing workers from retraining as heat pump engineers was perception of low consumer demand for the clean heating technology, paired with a perceived lack of commitment from government to deliver the solution at scale. Nesta said this suggested uptake of clean technologies could be being hampered by an unfortunate “chicken-and-egg situation”, whereby low consumer demand is stopping individuals and businesses from investing in upskilling, while at the same time a lack of trained workers is stymying demand.

To mitigate the impact of a green skills crunch, the researchers have urged government to encourage the take up of STEM subjects; provide financial support to workers to incentivise green upskilling and education; establish green apprenticeship schemes; add essential green skills to educational curricula; emphasise green skills and jobs at Jobcentres; create a network of national and regional centres of excellence for green skills; and develop place-based green skills plans.

It also calls on businesses to do their utmost to upskill workers, by developing communications campaigners to encourage workers to take up training and education, and consider introducing new workplace requirements to increase training participation among employees. The report also highlights the need to boost awareness of green jobs, pointing to studies that reveal many workers do not know what a green job is, let alone where to find one. It also stresses that the inequal geographic spread of jobs around the country reduces their attractiveness to many workers.

It all adds up to a daunting to do list, but Nesta stresses that wrestling with it is essential. “While it is hard to determine the urgency of addressing this barrier due to the lack of evidence detailing how many green jobs are being created and how quickly these jobs are being filled, the projections for the increasing demand for green jobs over the coming decade and beyond, paired with the lack of corresponding workforce skills, raises significant concerns around worker shortfalls,” it states.

Clearly, the focus on creating jobs through new industries is critical, and government and industry are right to highlight the number of positions each new low-carbon factory, clean power plant, or recycling facility can create. But clearly, if the groundwork is not done to ensure the UK’s workforce is prepared to take on these roles, green industries could quickly find there is no one available to seize the opportunities they are offering.

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