Green Alliance warns skills gap is already hampering climate action, as separate study from Centre for Policy Studies urges government to integrate net zero and levelling up agendas

Think tank Green Alliance has today become the latest organisation to raise the alarm at the prospect of a looming green skills gap, warning the UK’s net zero transition could be put at risk unless urgent action is taken to enhance the country’s skills base.

Echoing previous calls from business leaders and unions, Green Alliance today published a new report calling for the introduction of a co-ordinated green skills programme to help maximise the job opportunities that should result from the net zero transition.

The report – titled Closing the UK’s green skills gap – highlights how 80 per cent of the people who will be employed in 2030 are already in the workforce, meaning large numbers must be retrained and upskilled in low carbon jobs if the UK is to meet its climate targets.

It also warns that skills shortages are “particularly stark for the industries that most urgently need to decarbonise, such as transport”. The transport sector is set to create around 175,000 jobs in the next 13 years, as it switches to a raft of clean technologies, but these new jobs will require new skills in battery manufacturing, electrification engineering, and developing sustainable aviation fuels. The same pattern is repeated in other sectors such as energy, building, and agriculture, where demand is expected to increase for a wide range of technical skills.

“There’s no doubt that net zero will bring huge job opportunities for the UK,” said Helena Bennett, senior policy adviser at Green Alliance. “But if the prime minister wants a ‘high wage, high skill’ economy, then we need to build a workforce for the green jobs of the future. Supporting businesses, institutions and individuals will help to develop the skills we need for thriving green industries. But if we don’t have a proper programme the UK risks being outpaced by other countries.”

Her comments were echoed by Alex Thwaites, head of zero carbon living at energy giant OVO, who said there was “a huge challenge on our hands to build the green workforce needed to reach net zero and realise this major economic opportunity for the UK”.

He added that the energy sector faced a particular challenge if it is to deliver on targets to slash emissions this decade. “Much more support is required to incentivise gas boiler engineers to retrain in heat pumps and attract new entrants to lifelong careers in low carbon heat, EVs, solar panels and more,” he said.

The Green Alliance report sets out several recommendations for how the government could help tackle the growing skills gap. For example, it calls for the introduction of a ‘green skills super deduction’ tax relief for businesses that invest in training and skilling up staff for green jobs, modelled on the super deduction policy for machinery announced by Chancellor Rishi Sunak in the 2021 Spring Budget.

Similarly, the report recommends the introduction of a system of loans and grants to help reduce the risk of training and retraining staff in new skills, the development of more focused green skills programmes through higher and in-work education, and improvements to careers guidance services to highlight the opportunities provided by the net zero transition.

The report comes on the same day as a separate study from the Centre for Policy Studies (CPS), which similarly highlights the huge job creation potential of the net zero transition and calls on the government to better integrate its levelling up and net zero agendas to help ensure the economic gains are maximised.

The report highlights how many of the UK’s most carbon intensive regions – parts of the North and Midlands, as well as areas in Scotland – are also at the forefront of the government’s ‘levelling up’ ambition.  As such it stresses that “in order for decarbonisation to succeed, and to retain public support, we must ensure that the places that will be most impacted by the carbon transition can also benefit from new green jobs and investment”.

To help channel green investment into these regions the report sets out a raft of policy recommendations, including the introduction of carbon border taxes to ensure UK industrial businesses are not at a competitive disadvantage to rivals in jurisdictions with lower carbon prices, increased R&D spending, and the introduction of a ‘green super deduction’ to help businesses invest in greener technologies.

It also echoes Green Alliance’s report in calling for reforms to skills programmes to help bolster green and technical skills and a clear commitment from government to reinvest revenues from carbon policies into helping local areas transition to net zero, including via a new breed of technical universities. “Revenues from the carbon border tax and wider carbon pricing should be used to create technical universities in areas in need of levelling up, to help equip workers for precisely the sorts of green jobs which will form the future green economy,” the report states. “Carbon revenues could also be channelled into economic development funds for local authorities.”

“Having just hosted COP26, it is now time to get on with the next phase of decarbonising Britain’s economy,” said Eamonn Ives, head of energy and environment at the CPS. “But at the same time, progress must be made on the government’s levelling up agenda. By tackling emissions from challenging sectors such as steel production or other industrial activities in the right way, these two goals are not just compatible but complementary. The package of policies mapped out in our report will help put Britain at the forefront of the global Net Zero realignment while providing a boost to the UK regions that need it most.”

The report was also welcomed by Conservative MP Alexander Stafford MP, who sits on the Business, Energy and Industrial Strategy Select Committee and has been a vocal supporter of the government’s net zero plans. “There’s no path to net zero that doesn’t run through this country’s industrial heartlands and that doesn’t involve reindustrialisation by new means,” he said. “Business and enterprise will drive innovation and technological solutions – let’s unleash that potential and build the future with the pride of our past.”

Stafford’s analysis is right, but as today’s reports highlight, without a genuinely ambitious and effective green skills programme the green reindustrialisation that net zero demands risks being badly delayed.

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