In this report for Lloyds Banking Group we review evidence on the potential impact of the transition to net zero on the UK economy.
In 2019 the UK parliament passed legislation to commit the country to reducing net emissions of greenhouse gases by 100% by 2050. Reaching net zero will require substantial investment in new technologies and activities. This need to invest means there is a unique opportunity for British businesses to innovate, produce, and supply the goods and services needed to enable the transition, not only in the UK but across the globe.
Official estimates suggest that the UK’s green economy already supports 200,000 to 400,000 jobs. And while there is considerable uncertainty surrounding future growth, two recent studies have suggested that by 2050 the number of jobs in the green economy could grow to between 1.4 million and 2.5 million. There is particularly strong growth potential within the fields of low-carbon energy and electric vehicles to serve UK and international demand. The need to retrofit buildings, particularly homes, with insulation and low-carbon heating will support activity for local businesses across the UK.
However, many of the new green jobs will emerge as a result of the transformation of existing roles. And certain carbon-intensive activities, such as those linked to fossil fuels, will need to scale back over the coming decade. Skills and training will therefore play a pivotal role in the UK’s ability to deliver and capitalise on the net zero transition.
The path ahead is uncertain and for many businesses it may be unclear how they can play their part in the effort to reach net zero. There is a need for clear and practical guidance to help different types of business understand the path ahead and to guide them as they seek to engage and prosper in a zero carbon future.
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