Employment and the circular economy Infographic
Britain faces huge economic challenges in its use of labour and scarce natural resources. Although unemployment is now falling, the risk of being out of work is higher in some regions and for some types of occupations. And supply risks in an increasingly competitive global economy mean we must get better at using natural resources. Our analysis shows that these challenges are linked, as improving Britain’s resource efficiency could also significantly benefit the labour market. Developing a circular economy involves a major industrial transition. In the past, industrial developments have often involved using less labour, creating high unemployment in some regions or for some categories of workers. By contrast, the growth of the circular economy should involve using resources more efficiently,
but with more labour. And, significantly, this growth in employment is likely to be experienced right across the country, concentrated among occupational groups where unemployment is high, such as the low skilled, or in skilled occupations where large numbers of jobs are projected to be lost in the future. Our illustrative calculations suggest that, if the current trend towards greater resource efficiency continues, the growth of the circular economy could reduce unemployment by about 54,000 and offset around seven per cent of the expected decline in skilled employment. Even more extensive development of the circular economy has the potential to reduce unemployment by around 102,000 and offset nearly a fifth of the expected loss in skilled employment.
The UK is becoming more efficient at using resources 1...
Resources wasted
2000
2010
210 million tonnes
160 million tonnes
50 million tonnes
Resources recycled
115 million tonnes
520 million tonnes
420 million tonnes
Resources extracted or imported
...if this continues, employment in the circular economy should keep growing 2 Actual employment in circular economy activity in 2008 and 2012, and potential employment to 2030, based on the current path of development 667,000
452,000
462,000
2008
2012
2030
It can also create additional jobs where unemployment is higher 3 Unemployment rate in UK regions, June-August 2014
Potential net job creation in circular economy activity to 2030 at current growth rate (as a percentage of labour force)
Scotland 5.5%
Scotland 0.07%
North East 0.54% (6,948 jobs)
North East 9.3% North West 6.7% Wales 6.5% West Midlands 7.5%
North West 0.24% (8,474 jobs)
East Midlands 5.5%
Wales 0.23%
East England 4.9%
West Midlands 0.39% (10,659 jobs)
London 6.6% South East 4.7%
South West 4.6%
Yorkshire & the Humber 0.30% (7,978 jobs)
Yorkshire & the Humber 7%
East Midlands 0.08% East England 0.01% London 0.12%
Different circular economy activities offer different skill opportunities 4
Activity
Higher value, closed loop recycling
Lower value, open loop recycling
Servitisation (services instead of products)
Remanufacturing
Reuse
Biorefining Low skilled
Skilled
Professional
...and there is the potential to create proportionally more jobs in occupations with high unemployment 5 Net job creation potential by occupation under the current Net job creation development path potential by occupation to 2030 (as a under the current percentage of the development path labour force) to 2030 (as a percentage of the labour force) Current occupational unemployment (as a percentage of the Current occupational labour force) unemployment (as a percentage of the labour force)
0.74%
0.61%
0.74% 0.24%
0.12%
0.24%
0.12%
3.69%
0.61%
0.28% 0.28%
4.34%
3.69%
5.77%
4.34%
5.77%
7.85% 7.85%
Sales and customer services Sales and customer services
Administration and secretarial Administration and secretarial
9.74% Skilled
Operatives
9.74% Elementary
Skilled
Operatives
Elementary
...and also help to address the projected decline in low skilled and mid level occupations 6 Net job creation potential by occupation under the current Net job creation development path potential by occupation to 2030 (as a under the current percentage of the development path labour force) to 2030 (as a percentage of the labour force) Expected change in occupational employment to 2022 (%) Expected change in occupational employment to 2022 (%)
0.74%
0.61%
0.74% 0.24%
0.12%
0.24%
0.12%
0.61%
0.28% 0.28%
-2.4%
-2.0%
-2.4%
-2.0%
-8.7% -8.7%
-10.8% -10.8%
-12.9% Sales and customer services Sales and customer services
-12.9%
Administration and secretarial Administration and secretarial
Skilled
Operatives
Elementary
Skilled
Operatives
Elementary
Because it helps tackle regional and occupational unemployment, over a quarter of new jobs in Britain’s circular economy to 2030 could be net jobs 7
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Data sources 1 Note: ‘Resources wasted’ covers all materials going to any waste disposal route. Some of the materials flowing into the economy are consumed directly, for example food and drink, or are dissipative outputs to land and air, while others are absorbed into fixed assets and infrastructure and are available for future recovery. Resources extracted or imported include biomass, metals, minerals and products. Source: ONS and WRAP calculations 2 Historical data: ONS Business register and employment survey (BRES), for details of the compilation of these figures see J Morgan and P Mitchell, 2015, Opportunities to tackle Britain’s labour market challenges through growth in the circular economy, Green Alliance/WRAP; future scenario for the circular economy: Green Alliance and WRAP calculations, see J Morgan and P Mitchell, 2015, op cit 3 Historical data: ONS, Labour force survey, October 2014; future net jobs scenario for the circular economy, Green Alliance and WRAP calculations, see J Morgan and P Mitchell, 2015, op cit 4 Green Alliance and WRAP, see J Morgan and P Mitchell, 2015, op cit 5 Uses Standard Occupational Classification (2010). Historical data: ONS, Labour force survey, October 2014; future net jobs scenario for the circular economy, Green Alliance and WRAP calculations, see J Morgan and P Mitchell, 2015, op cit 6 Expected decline in occupational employment to 2022: UKCES, March 2014, Working futures, evidence report 83, UK Commission for Employment and Skills; future net jobs scenario for the circular economy, Green Alliance and WRAP calculations, see J Morgan and P Mitchell, 2015, op cit 7 Green Alliance and WRAP, see J Morgan and P Mitchell, 2015, op cit
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