Green Jobs Meet Reality….

Columnist David Brooks wrote yesterday in the Seattle Times that “For jobs, it’s not easy being green.”  He is right.

There have been numerous stories emerging lately that suggest that throwing money at green initiatives is not yielding the promised job growth.  In Seattle, the recent Seattle PI (commentary) story that the $20 million in federal money to created green jobs and make homes energy efficient has, thus far, not come anywhere close to achieving its promises.  Aaron Glantz of the New York Times has reported similar results in California.  $186 million awarded to weatherize homes has yielded 538 FTEs.  A $59 million program to train people for green jobs has resulted in 719 job placements.

Brooks says that “Many of the most celebrated green-tech companies are foundering despite lavish public support.”  Evergreen Solar, which received “tens of millions in state support,” has filed for bankruptcy.  So has solar panel maker Solyndra, the recipient of $535 million in Department of Energy loan guarantees—and now the subject of scrutiny over improprieties.

It wasn’t too long ago when we were hearing that the green revolution would result in nearly endless economic benefit.  The US Conference of Mayors estimated that ten percent of job growth would be green over the next thirty years.  In 2008, candidate Obama talked about five million green jobs.

Things have changes.  In fact, Brooks says, “There is a wealth of evidence to suggest that the green economy will not be a short-term jobs machine.”

He is partly right.

There has certainly been a lot of overhype about the clean economy and its potential.  Creating jobs and growing a new technology sector isn’t easy or simple—or inevitable.  But there has been progress.  Probably the best recent analysis was completed by Brookings and released in July entitled (commentary) “Sizing the Clean Economy:  A National and Regional Green Jobs Assessment.”  The findings suggest that there is real significance behind the hype.  2.7 million Americans are employed in clean economy jobs spread over a diverse group of industries.  The sector is larger than the fossil fuels and the biotech sectors.  It is about 60% of the size of the IT-producing sector.

The approach has been wrong.  Brooks argues that policy makers have gambled on short-term, quick fix policies that have not been successful.  The instant rush effort wastes billions of dollars.  A better approach sets the table for the longer term. It should be noted, however, that this applies across the board—not just to the clean economy.  Despite highly publicized failures in  cleantech—and other—fields, stimulating new businesses and jobs is a very difficult task.  Both private and public sector investments in new technology entities fail more than they succeed.

The more effective approach, Brooks argues, looks into the future and sets the table.  Government can and should do things that have strong impacts over the long run.  Funding academic research, enhancing technology transfer, encouraging investment in new businesses, establishing clear laws, improving infrastructure, and reasonable immigration policy are examples that make a difference.

There are times when it is in our interest as a society to invest in unproven technology development.  Our investment of over $25 billion in medical research annually is an excellent example of this.  We want to stimulate the development of new cures for dread diseases.  Almost everyone agrees that these financially highly risky investments in medical research are worth the risk.  There are a plethora of reasons for investing in clean technology development, as well.

Ultimately, new technologies must withstand the rigors of the marketplace—and thrive.  The fact that new technologies might have generous amounts of the “cool factor” isn’t enough:  If they can’t be successful in the market, most will fail in the long run.  We might have a national interest in subsidizing their creation, but we should ponder carefully the implications of endless subsidization of a technology that the market rejects.

Brooks correctly concludes that “We should pursue green innovation.”  But we must be sober about its short term potential to right all that is wrong in the economy and optimistic about the future.