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Title: The Employment Impact of a Green Fiscal Push: Evidence from the American Recovery and Reinvestment Act
Citation Type: Working Paper
Publication Year: 2021
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Abstract: Investments in the green economy are used for both environmental policy and fiscal stimulus. The success of these investments depends, at least in part, on whether they create new jobs and whether such jobs are available to workers negatively impacted by a green transition. We evaluate the employment effect of green investments from the American Recovery and Reinvestment Act (ARRA). Most job creation from green ARRA investments emerged in the postARRA period (2013-2017) and mostly benefited areas with a greater prevalence of pre-existing green skills. On average, each $1 million of green ARRA created approximately 10 long-run jobs, but the job creation effect doubled in regions in the last quartile of green skills distribution. New jobs are primarily in construction and in occupations performing green tasks that have, on average, a higher training requirement than comparable occupations. Manual workers are the main winners in terms of employability, but not of wage gains. Descriptive evidence suggests that potentially displaced workers in fossil fuel sectors have skills necessary to benefit from green investments, but that communities with high levels of green skills are often wealthier. Thus, using green stimuli as part of a green energy transition may exacerbate regional inequities.
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Authors: Popp, David; Vona, Francesco; Marin, Giovanni; Chen, Ziqiao
Series Title: Brookings Papers on Economic Activity, BPEA Conference Drafts
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Pages: 1-98
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Data Collections: IPUMS USA
Topics: Labor Force and Occupational Structure
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