Sparking the Conversation: Decent Work in the Green Economy

October 11, 2017

By Scott McFatridge, Mercedes Marcano, Jordann Thirgood

In partnership with the Mowat Centre and with support from the Atkinson Foundation’s Decent Work Fund, we are releasing a report on Decent Work in the Green Economy.

Economies around the world are in transition as businesses, citizens and governments embrace new ways of generating growth that put less strain on the planet. In Ontario, the transition to a green economy will have unique impacts on economic sectors and the people who work in them. That’s why-- both at Mowat Centre and at Smart Prosperity Institute-- we are convinced that promoting a conversation between those actively supporting the transition to a green economy and those advocating for decent work (understood as employment that is productive, secure and delivers a fair income and equality of opportunity) is essential. If we fail to convince workers and businesses of the opportunities presented by the green transition, and we fail to design green economy policies with decent work in mind, we’ll risk losing two vital allies in this societal change.

With this new report, we aim to raise awareness and spark a discussion around decent work considerations in Ontario’s green transition. Here are the main findings:

Ontario’s Changing Economy

Ontario’s economy has seen major changes in the past two decades - including a shift from a goods production to a service and knowledge-based economy, automation placing traditional occupations at risk, Ontarians working increasingly precarious jobs with less security and fewer benefits, as well as stagnant wages amidst rising living costs. The impacts of these changes are not distributed evenly across society, amplifying existing inequalities.

Ontario’s Green Transition

At the same time, Ontario is going through a second set of disruptions, driven by the shift in the global economy toward a model of less polluting and more resource-efficient growth. Ontario is leading the way through its linked cap and trade program with Québec and California, its new Strategy for a Waste-Free Ontario, and its burgeoning clean-tech industry.

Impacts on Jobs and Workers

For many businesses and economic sectors, the transition to a green economy means tapping into what McKinsey Global Institute and Analytica Advisors project to be trillions of dollars in opportunities for low-polluting and resource-efficient solutions worldwide. Ontario’s cap and trade program is catalyzing tens of billions of dollars in low-carbon technology investments from business, governments and households. We anticipate that cap and trade and other complementary green policies - such as the Waste diversion targets to be established through the Strategy for a Waste Free Ontario - will lead to accelerated GDP and employment growth in sectors such as utilities (especially renewable energy), waste management and remediation services, as well as scientific, technical and professional services.

But the transition is potentially disruptive for other sectors – mostly concentrated in heavy industry -which might see lower GDP growth, such as petroleum refining, or iron and steel production. And other sectors – such as construction and forestry - will make significant alterations to their operations and work practices, even if the green transition doesn’t have much of an impact on their GDP growth rate.

These changes will directly affect workers and have significant ramifications for their ability to secure decent work. For example, although most sectors that are expected to grow under a green transition currently have higher wages than the provincial average, these sectors will likely see growth in jobs that require higher levels of education and specialized skills.

This not only raises important questions about access to post-secondary education and skill development, but also about the type of workers that will experience negative impacts. How will a transition to a green economy impact historically disadvantaged and equity-seeking groups? For example, women and racialized communities appear to be underrepresented in the utilities sector (a sector expected to see rapid growth in a green transition). Will these groups increasingly face greater barriers to decent work? Or can the green transition provide an opportunity to overcome these obstacles?

What’s next?

The transition to a green economy is happening irrespective of government direction. It’s being driven by citizens and business and by global trends. In Ontario, the transition will have unique reverberations on economic sectors and the people who work in them. While the pace of the green transition worldwide cannot be fully predicted, policymakers need to anticipate these impacts and ensure that policies and programs are in place that harness the full strength of Ontario’s diverse workforce to succeed in the green economy of the 21st century. Ontario must make its green transition a triple win - one that offers social, economic and environmental opportunities for all Ontarians.

To learn more about our findings and policy recommendations, read our report and stay tuned for our upcoming blog where we outline seven policy recommendations to enhance decent work opportunities in the transition to a green economy.