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Environmental Regulations Create Jobs, Economists Say

By Melanie J. Martin - 31 Oct 2011 12:16:0 GMT
Environmental Regulations Create Jobs, Economists Say

Job search via Shutterstock

If you look at the facts, job creation vs. economic regulations shouldn't even be a debate. A briefing from Economics for Equity and Environment (E3) states, as its first point, that "Reduced oil imports would create jobs." The money we saved on oil would be spent at home, on things like alternative energy development, to the tune of 900,000 new jobs for every $100 billion decrease in spending on oil. Pretty neat, right?

It gets better. Layoffs due to environmental regulations will be minimal, say the E3 economists. They'll account for about 1/10th of one percent of all layoffs throughout the U.S. Meanwhile, economists with the Political Economy Research Institute predicted in 2009 that clean energy investments and increased environmental regulations would lead to a net increase of 1.7 million jobs. The construction and manufacturing industries will experience high rates of job growth, because those greener buildings and innovations need people to build them. Green designers such as architects and engineers will also find increased opportunities.

Investing in clean energy would stimulate the economy too, having a positive effect in jobs in other fields as well, says the 2009 study. The researchers predicted that federal investments in energy efficiency, cleaner transportation, and renewable energy would play major roles in stimulating the economy.

Some claim that regulations will lead companies to set up shop abroad. Not so fast, experts say. Doesn't moving all of one's operations overseas come with a high price tag? As you might expect, it does. Research has shown that companies rarely relocate abroad due to increased environmental regulations, as a recent New York Times article says. Instead, companies simply adapt.

Complying with regulations is often well within a company's means. Usually it amounts to less than 2 percent of business costs. Often, avoiding pollution actually helps a company's bottom line by avoiding waste. Regulations force companies to get more creative, devising ways to avoid polluting so they don't need to worry about cleaning up after it.

As Kristen Sheeran points out in an article on Real Climate Economics, we should be concerned first and foremost with the net gain or loss of jobs. Workers in particular companies may lose jobs due to increased regulations, but other industries may add more jobs. Yes, coal miners will have to adapt, say economists, as jobs in this industry decrease. However, adaptation is the rule, not the exception, for any economy.

Furthermore, considering loss (or gain) of jobs in isolation of other considerations, such as improved health, fails to fully analyze how increased environmental regulations would benefit quality of life. With improved environmental conditions, health increases, and people spend less on healthcare. They miss less work, and stay more productive. And yes, health does relate directly to the environment - poor air quality can cause asthma, as well as other respiratory and heart diseases. Jobs aren't the only concern of workers, politicians must consider - workers are also concerned about their children's health, their own health, and avoiding costly healthcare bills that would never be necessary in a cleaner environment.

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