Economist Robert Pollin’s latest report projects an increase of 16.7 jobs per $1 million invested in clean energy.
As co-director of PERI, Pollin explains that there is one solution to both problems: green economy. Unemployment is at a high, renewable energy is a hot commodity and climate scientists assert that the world could be headed for catastrophe, but the green energy industry could be the planet’s saving grace.
“What I wanted to get at was a different perspective which considered the notion that building a green economy, including retrofitting existing buildings, including building renewable energy into the economy in a major way itself could be a major source of job creation. It has to be,” Pollin says.
Pollin explains that every time the government or private sector spends money, that spending creates jobs. However, all investments do not yield equal return, which is why Pollin and his associates set out to calculate precisely how many jobs could be created by promoting green industry relative to maintaining a fossil fuel economy. Pollin’s April 2012 report, “Public policy, community ownership and clean energy,” projects an increase of 16.7 jobs per $1 million invested in clean energy, versus 5.3 jobs relative to continued investments in fossil fuels.
According to Pollin, retrofitting existing buildings for increased efficiency is a win-win in all regards. It would greatly reduce greenhouse gas effects, save building owners money and create a new line of construction jobs—a field that’s taken a big hit since the recession took hold in 2008. It also serves both short term and long-term perspectives, as money is saved as soon as renovations are completed. Pollin says that the average owner can expect a 30 percent return by retrofitting; it generally takes about three years to recoup the investment. Gordon Hall, which houses PERI, got a retrofit last year.
“Just about any building in the world could benefit from a retrofit,” Pollin says.
The Department of Energy called upon Pollin in 2009 when devising the American Recovery and Reinvestment Act. Pollin served as an expert consultant in the Obama stimulus package, which included $100 billion in clean energy investments. Pollin says the investments were a “massive breakthrough,” and while there may be some kinks to work out, it is one step in a transitional phase that will result in a more robust, sustainable future.
Pollin’s newest research looks closely at the emission targets put forth by the Obama administration and recommends strategies for achieving them. His calculations conclude that the U.S. must reduce emissions by about 35 percent by 2030, or in absolute terms about 2 percent per year, in order to meet the targets. Pollin says it will be a challenge, but a necessary one that embraces the broad, cooperative perspective necessary to face the obstacles ahead.
“That idea is out there, now we just need to deepen it,” Pollin says.
Pollin and Gerald Epstein founded PERI in 1998 with the ambitious goal of promoting “human and ecological well-being.” The institute is an independent unit on the UMass Amherst campus and functions in association with the Economics Department. A cadre of research associates including faculty, graduate students and collaborating economists investigate and publish policy proposals aimed at improving quality of life worldwide. The team covers issues ranging from globalization, unemployment and financial markets to the economics of peace, development and the environment.
Though the institute did begin with environmentalism as one of its areas of research focus, Pollin acknowledges that he himself was never an environmental economist per se. Most of his research had previously been around creating decent jobs, full employment and stable financial systems, both in the United States and globally. Pollin’s research in clean energy economy is a fairly newfound specialty, assisted greatly through his initial collaboration with colleague Heidi Garrett-Peltier. About five years ago, when Garrett-Peltier was still a graduate student, the two researchers began thinking jointly about ways to develop statistical models to examine how investments in the environment could also act as an engine of job creation. With this approach, their aim was to test whether environmentalism could bolster the economy instead of being seen as a cost to businesses and a drag on job creation.
Environmental policy and modes of economic stimulation have become heated, partisan issues in this election season. Pollin asserts the environment can be protected in a profitable way and should not be a “political football” to toss back and forth across party lines. By taking a face-value approach to the economy and environment, Pollin is able to clarify and mitigate points of tension.
Pollin started out in journalism out of college, but his fascination with what one can understand through studying numbers grew quickly as a graduate student in economics. For him, numbers are three-dimensional figures that come to life after long, onerous calculations. The results serve to create hypothetical models that allow Pollin to look for patterns and draw meaningful conclusions about the future.
“You have to be able to tell real stories. You can’t just see the numbers, you have to know what matters,” Pollin says.
Amanda Drane '12