News Flash: Public Policy a Factor Driving Green Business and Green Jobs
It shouldn’t surprise us that policies set by all levels of governments can contribute to the success of green businesses and the development of green jobs. It shouldn’t embarrass us either when they do. While the same can be said for other types of businesses and jobs, it usually remains unsaid.
Still, whether public policy is, or should be, a factor behind the growth of green enterprise and employment can be a murky issue, as an article in today’s Chicago Business News demonstrates.
The article A Green New World reports that “5.3 million jobs have been created by environmental management and protection” in the U.S., ten times the number of jobs in the pharmaceutical industry. It also finds forecasts that indicate sales of green products will continue to rise, and programs that train workers for green careers are observing growing demand by employers.
However, the article begins with a contrast between the present and the past that, to my mind, draws an incorrect distinction:
“Except for the handful of do-gooder roles held by an idealistic few, environmental jobs used to be all about regulatory compliance. No more.
Thanks to the likes of Al Gore, rapidly mobilizing consumers and the very real threat of legislation limiting carbon emissions, businesses are seeing the environmental benefit and the financial sense of giving a hoot.”
For a start, if businesses are preparing for expected legislation that will regulate carbon dioxide emissions, then how different is that from earlier types of environmental compliance? Clearly, laws to protect our environment (and the expectation of such laws) still contribute to business decisions to invest in cleaner practices and train and employ people with appropriate skills.
In addition, policy decisions at the local level are often a factor that leads to opportunities for green businesses. A recent article about green roofs in the St. Louis area noted their increasing popularity, which has boosted the sales of local businesses such as Green Roof Blocks. The article observes that a policy change by the local sewer authority helped to spark interest in green roofs:
“The decision of the Metropolitan St. Louis Sewer District to charge for storm-water runoff, based on the impervious square footage on a parcel of land, has brought green roofs into the limelight because they can replace impenetrable space on a roof.”
Other factors that helped businesses that design or install green roofs include large projects at public colleges and government buildings, which increased both demand for and awareness of green roofs. Finally, businesses cited in the article are participating in a (public) university study of the environmental impact of roof greening in the Midwest, which could further enhance their business prospects if it provides compelling evidence for the benefits of green roofs.
A reference to Raquel Pinderhughes, a professor of urban studies at San Francisco State University, in the Chicago Business News article I mentioned earlier led me to a report (PDF) on her website, which provides a far more convincing account of the contributors to green economic development than we often see in the media.
Here are the highlights from Pinderhughes’ list of six major factors involved in the growth of the green economy in the San Francisco Bay Area:
- State and local governments are increasingly adopting public policies designed to improve
urban environmental quality. - Government action to reduce greenhouse gas emissions is fueling growth of green businesses and green collar jobs.
- State and local officials are steadily increasing their support for green economic development and green businesses.
- Educational institutions are creating green collar jobs as they implement initiatives designed
to reduce their ecological footprints and improve environmental quality. - Bay Area residents are increasingly choosing to purchase goods and services from businesses that are environmentally responsible whose products and services improve environmental
quality. - Venture capital investment in green technologies is increasing.
It is not unusual to come across accounts of green business that only emphasis the last two factors on that list, consumer and investor interest in green business. Pinderhughes’ report is a welcome contribution that makes a strong case that public policy at different levels of government is important to the development of a green economy. Some commentaries on green business seem to shy away from this recognition, as if green businesses would only be legitimate if they were created solely to serve demand that was not influenced by government. (The Chicago Business News article admittedly does not go quite that far.)
We don’t hold other businesses to that standard. We don’t argue that carmakers are illegitimate because their products rely on government-financed roads and government-subsidized fuel. We don’t contend that financial firms aren’t pulling their weight because they attract clients through tax-advantaged retirement plans made possible by government policies. However, we don’t often think about the ways in which government makes it possible for companies to prosper. There are many long-established policies that we simply don’t notice, even as they provide strong benefits to particular industries. If we are not aware of these, we might either think that green businesses will succeed without any government action or that public policies to promote a green economy are unfair interference. In reality, public policies that enable green economic opportunities are just another case of a long-established pattern.
If you are interested in what Professor Pinderhughes and her associates found out about green jobs and green business development, the whole green collar jobs report (PDF) is certainly worth a read, or, at a minimum, the executive summary (PDF).
Evan
