Job impacts of a decarbonised Australian economy

Abstract

The fourth assessment report of the Intergovernmental Panel on Climate Change (IPCC) posits that developed countries will need to make significant cuts in greenhouse gas emissions to limit the chances of dangerous climate change. Numerous studies in the Australian context have examined a broad range of emission reduction targets and their impact on different sectors of the economy. The majority of these studies show that one of the biggest transformations is expected to occur in the energy sector. In regard to electricity generation, a carbon price makes renewable generation more competitive relative to coal, leading to a transition away from conventional coal-fired generation towards renewable technology. The transition has flow-on effects to other sectors of the economy such as mining. This paper uses input-output analysis to estimate direct and indirect impacts on employment for Australia from a transition towards a decarbonised economy. The results show that the magnitude of change is highly dependent on the uptake of alternative low emission technologies and the emissions reduction trajectory that is pursued in Australia and the rest of the world.