The Levelling Up White Paper makes explicit reference to the Net Zero agenda, stating that the transition “could have large and long-lasting effects on virtually every aspect of the economy, including jobs and skills, infrastructure and technology, and investment and innovation”.

While there are fears that this transition could impose a considerable cost both on society more broadly and also on those individuals and communities that are least able to bear those costs, there is also a very clear opportunity for a so-called “Green Industrial Revolution” to advance the levelling up agenda in profound ways.

Making the transition

The impact can be profound in a number of ways. Firstly, the transition from fossil fuels to clean fuels can produce good-quality jobs in previously deprived areas. Research from the University of Michigan shows that there is a good crossover between the skills required to perform jobs in fossil fuel-based industries and to do jobs in renewable energy sectors.

For instance, they highlight how transferable jobs are in fossil fuel industries to those in renewable sectors. The research evaluated the career options for the approximately 80,000 coal-fired generator workers in the US in case of closure. The results showed that their skills are applicable in renewable energy industries, such as solar. They do find, however, that government interventions are necessary to direct solar investments toward former coal communities.

This was also evident during our research, where participants from deprived communities in France were given the chance to develop skills in vital renewable energies, such as solar power. Not only did these programs provide participants with valuable skills but the resultant solar energy also helped to provide clean, sustainable, and affordable energy to the local community.

Green jobs

The potential for the net zero economy to support deprived communities was reinforced by a recent report from the Energy & Climate Intelligence Unit. The report, which was based on data from the CBI, highlights that many of the 20,000 businesses currently operating in the net zero economy are spread throughout the United Kingdom. What’s more, the jobs provided by these businesses are high quality, with an average wage of £42,600. This compares to £33,400 for the average UK employee. 

“The economic activity of these businesses brings substantial impacts across the UK,” the report explains. “Areas such as the North East, Scotland, Northern Ireland, and the South West have a higher concentration of businesses within the net zero economy, compared to traditional concentrations of activity in London and the South East.”

What’s more, the economic impact of the net zero economy was found to be stronger in each of the regions of the United Kingdom than it was in London. The net zero economy has proven to be highly productive, even in areas with historically low productivity. In the Midlands (East and West), for instance, it’s more than 2.5 times more productive compared to the regional average.

Constituency-level economic modeling reveals the potential for net zero hotspots throughout the UK, with the researchers identifying 20 areas where the net zero economy made a significant contribution to the local economy as measured by GVA. These include a number of areas covered by our own research.

“From insulation fitters to heat pump engineers and agritech pioneers, businesses in the net zero economy are adding £70 billion to the UK economy,” Peter Chalkley, Director of ECIU, explains. “Billions of pounds of private sector investments are being made in net zero with the hot spots of activity being outside of London in places like Tyneside, Merseyside and Derbyshire.”

Part of the solution

A paper for the Economy 2030 Inquiry reminds us that net zero isn’t going to solve the regional inequalities that are at the heart of the levelling up agenda on its own. The report is nonetheless positive about the impact that targeted investment could have to communities that are so often deprived of the support they so desperately need.

“Smart net-zero investment should be embedded in a wider economic strategy – especially as it could have the additional benefit of bolstering the government’s Levelling Up agenda,” the report states.

The broad range of businesses in the net zero economy indicates that as the UK moves towards net zero and more businesses become part of this sector, it will further diversify economic activity. 

Currently, regions like the North East, Scotland, Northern Ireland, and the South West have the highest concentration of net zero businesses relative to total businesses in the area. Hence, the expansion of the net zero economy holds great promise for regions throughout the UK to drive growth and narrow regional disparities.

We’ve seen firsthand in France how investing in green jobs can provide not only employment but also energy security to deprived communities. If they can form part of the 20 “hotspots” identified by the ECIU then that would help to build some welcome momentum behind the levelling up campaign.

This article was co-written with Professor Zografia Bika

Image credit: Bill Mead via Unsplash