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A RIZONA IN THE G REEN E CONOMY Labor Market Information Improvement Grant Project Overview Session 1 April 25, 2011.

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Presentation on theme: "A RIZONA IN THE G REEN E CONOMY Labor Market Information Improvement Grant Project Overview Session 1 April 25, 2011."— Presentation transcript:

1 A RIZONA IN THE G REEN E CONOMY Labor Market Information Improvement Grant Project Overview Session 1 April 25, 2011

2 C REDITS AND D ISCLAIMER 2 This report was funded by a grant awarded by the U.S. Department of Labor’s Employment and Training Administration. The report does not necessarily reflect the official position of the U.S. Department of Labor. The Department of Labor makes no guarantees, warranties, or assurances of any kind, express or implied, with respect to such information, including any information on linked sites and including, but not limited to, accuracy of the information or its completeness, timeliness, usefulness, adequacy, continued availability, or ownership. State of Arizona has the copyright to this report. Internal use by an organization and/or personal use by an individual for non-commercial purposes is permissible. All other uses require the prior authorization of the copyright owner.

3 W HY “GREEN”? W HY N OW ? T HE C ASE FOR R ESEARCH ON THE G REEN E CONOMY High profile policy priority related to: Energy Economic Development Job Creation Lack of a baseline of information about the economic importance of “green activities” Significant investments being made in policies to promote “green” economic activity and job creation Need for information to guide expectations about impacts of green investments Nearly $50 million available for research and capacity building from American Recovery and Reinvestment Act (ARRA) of 2009

4 A BOUT THE ARRA L ABOR M ARKET I NFORMATION IMPROVEMENT G RANTS : A N OPPORTUNITY TO GET ANSWERS What exactly should be counted as a “green” economic activity or a “green” job? How important is “green” to the current economy? What jobs are available (or will likely become available) as a result of growth in the “green” economy? How do those jobs compare with other sectors? Implied question: Is the policy focus on growing “green jobs” warranted as an economic development goal?

5 A RIZONA ’ S G REEN LMI I MPROVEMENT G RANT 1. Project Mgt & Stakeholder Engagement Project Steering Committee Green Economy Advisory Committee 2. Green Economy trends Definition Quantitative data analysis 3. State of Arizona Green Industries Industry and occupations survey 4. Job Vacancy Survey 5. In-demand Green Occupation Profiles 6. Web Redesign Benchmark Arizona Workforce Informer Identify best practices and customer needs Implement enhanced web functionality

6 G REEN E CONOMY T RENDS 6

7 D EFINING G REEN J OBS : Green jobs are either: Jobs in businesses that produce goods or provide services that benefit the environment or conserve natural resources. Jobs in which workers’ duties involve making their establishment’s production processes more environmentally friendly or use fewer natural resources. --Bureau of Labor Statistics

8 O VERVIEW OF BLS D EFINITION, S EPT Energy generation 2. Energy efficiency a. Includes buildings, equipment, appliances, or vehicles 3. Reduction and reuse a. Greenhouse gas reduction b. Pollution reduction and cleanup c. Recycling and waste reduction 4. Natural resources conservation 5. Environmental compliance, education and training, and public awareness Output approach: Identifies establishments that produce green goods and services and counts the associated jobs based on the 5 green activity categories Process approach: Identifies establishments that use environmentally-friendly production processes and practices and counts the associated jobs Green Activity CategoriesMeasuring Green Activity

9 M EASUREMENT A PPROACH USED IN “B ATTELLE STUDY ” Identify Arizona-based enterprises producing green goods and services. No existing industry classification for green industries: E.g., solar energy, energy efficient products, green materials, and reduction of greenhouse gases are not “industries” Used business lists to identify companies with: Green certified products, VC/patent databases, national association memberships, market research listings, etc. Existence and operations of these firms were also verified to the extent possible through the examination of company websites and phone calls. Used employment reported in the Dun & Bradstreet company database. Used company websites to confirm Arizona business locations for firms not listed in D&B

10 F IRST M EASURE OF THE G REEN E CONOMY : B Y I NDUSTRY Battelle identified 1,711 establishments producing green goods and services in Arizona, which employ 31,649 at the end of At major the segment level, traditional environmental industries lead in employment.

11 L OOK AT M ORE D ETAILED G REEN I NDUSTRY S EGMENTS Arizona’s largest-employing green economy segments include: Waste Mgt. & Treatment – 353 establishments & 9,762 jobs Conservatio n – 246 establishments and 4,643 jobs Recycling – 277 establishments & 2,887 jobs Energy Efficient Building Products & Materials – 116 establishments & 2,234 jobs Environmental Research & Consulting Services – 279 establishments & 1,746 jobs Solar PV and Thermal Energy – 133 establishments & 1,496 jobs

12 I DENTIFYING S TRATEGIC “G REEN ” O PPORTUNITIES IN A RIZONA

13 N EW E NERGY E RA – D ISTRIBUTED S OURCES OF E NERGY T AKE H OLD World Energy Use by Fuel Type – 1980 through 2030 Sources: History: Energy Information Administration (EIA), “International Energy Annual 2006 (June- December 2008), web site

14 S ETTING THE C ONTEXT : A N E MERGING G REEN E CONOMY First Wave – Traditional Environmental Industries Led by advancement of environmental laws and regulations to address problems from air pollution, contaminated water, and hazardous/solid waste, among other environmental threats Emerging Wave – Renewable Energy & Energy Efficiency Led by growing concerns about the environmental impacts of climate change as well as the rising cost and uncertainty of oil supplies

15 I DENTIFYING S TRATEGIC O PPORTUNITIES IN THE E MERGING G REEN E CONOMY FOR A RIZONA Potential future growth driven by innovation in new technologies Most important opportunities in AZ include: Solar Photovoltaic (PV) Energy Solar Thermal Energy Wind Energy Biofuels/Biomass Energy Efficiency and “Green” Building Systems Water Efficiency and Management

16 A RIZONA G REEN J OBS S URVEY R EPORT 16

17 W HY A S URVEY OF G REEN J OBS ? Key workforce questions focused on what people do rather than what companies make What job titles and occupations are “green”? What skills are needed? What education is required? What wages are offered? Data not readily available by occupation No administrative source available to provide insights

18 G REEN A CTIVITY E XAMPLES USED FOR THE S URVEY Examples Of Green Activities Making Goods or Providing Services Improving Processes in Existing Goods or Services Energy generationProducing renewable energy Improving fuel efficiency Energy efficiency in buildings, equipment, appliances, or vehicles Building long-lasting batteries Implementing smart grid technologies Pollution reduction/removal, green-house gas reduction, recycling and reuse Producing industrial scrubbers or generating nuclear energy Managing energy proactively Natural resources conservationOrganic farmingConserving soil, water, or wildlife Environmental compliance, education and training, and public awareness Training in regulatory compliance

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20 S URVEY R ESPONSES Mailed surveys to 10,000 employers statewide Conducted follow-up mailing to non-respondents Response rate from mailings below 10% Conducted nearly 17,000 telephone follow-up calls (June to Sept. 2010) Final response rate: 52% Survey results used to make inferences to all AZ companies

21 D ISTRIBUTION OF G REEN J OBS BY Z IP C ODE

22 M OST C OMMON T ERMS IN R EPORTED G REEN J OB T ITLES

23 G REEN J OBS BY E DUCATION & C ERTIFICATION R EQUIREMENT

24 D IFFERENT M ETHODS OF C OUNTING G REEN J OBS Industry Approach Enterprise Approach (Battelle study) Occupational Approach (Arizona Green Jobs Survey/C2ER) All jobs classified green or non-green by industry 31,649 estimated jobs 1.2% of all AZ employment 30,716 estimated jobs 1.3% of all AZ employment Assign all jobs from a BLS-defined green industry Assign entire establishment’s D&B reported employment to green sector based on knowledge of products or services Assign a subset of firm’s jobs, counting only those that the company identified as “green” Advantages: Quick and easy to calculate Big employment number Disadvantages: Includes many “non- green” activities Misleading characterization of green sector Advantages: Uses existing data sources for employment Organizes firm-level data in ways that allow time-series Disadvantages: Requires manual classification of individual firms Data not readily available to public Advantages: More accurately reflects company perspectives Differentiates green/non-green at the occupation and job-title level Disadvantages: Represents point in time estimate Expensive to replicate

25 K EY F INDINGS FROM A RIZONA G REEN J OBS S URVEY 25

26 Survey results indicate that Arizona is presently home to 30,716 green jobs. This figure represents 1.3 percent of total statewide employment, falling slightly below average shares found in several previous studies of U.S. and other states’ green employment.

27 Service industries dominate Arizona’s green employment activities. Like the rest of the Arizona economy, most of the state’s green jobs are located in service-related sectors, such as architecture, construction, and engineering.

28 Green jobs and green industries closely align with existing industries and industry clusters. At present, nearly all of Arizona’s green jobs are located in firms that employ workers in both green occupations and traditional occupations.

29 Arizona does not yet appear to have any clear emerging large clusters of businesses or jobs in the leading clean tech sectors. However, Arizona is home to several leading research institutions that are creating significant new competitive advantages for the state in areas such as advanced energy storage, nano-materials, or biofuels.

30 Small businesses account for the bulk of existing and new green jobs. About half of the current green jobs are found in companies employing 50 people or fewer. An estimated 73 percent of new green jobs will be created in these small firms.

31 A large number of the current jobs making up Arizona’s green economy require relatively low skills and offer relatively lower average wages. Many of the state’s current green jobs pay wages below state averages and have limited education and training pre-requisites.

32 The state’s fastest growing green jobs tend to be concentrated in fields that provide higher quality and better paying jobs. Many of the green industry sectors and occupations slated for rapid future growth also pay higher wages than statewide averages. In addition, the green economy appears to be poised as a solid base for middle skill jobs.

33 Anticipated green job growth rates are quite impressive and represent a likely fast- growing sector in Arizona during the coming year and beyond. Overall, Arizona-based businesses expect to see 8.6 percent growth in green jobs in 2011, far outpacing the projected statewide growth rate of only 0.7 percent for all jobs.

34 A RIZONA J OB V ACANCY R EPORT 34

35 N UMBER OF GREEN AND NON - GREEN JOB OPENINGS May-10Jun-10Jul-10Aug-10Sep-10Oct-10 Total38,59635,28142,69254,53445,31159,780 Non-Green Jobs37,80534,70441,95853,44044,43458,589 Green Jobs , ,191 % Green 2.0%1.6%1.7%2.0%1.9%2.0% Source: December 2010

36 P ERCENTAGE OF U NIQUE “GREEN” W EB -P OSTED J OBS 36 Source:April 2011

37 D ISTRIBUTION OF J OBS A CROSS THE S TATE, (N OTE : A NOTHER D ATA S OURCE FOR “R EAL -T IME ” D ATA ) Source:April 2011

38 D ISTRIBUTION OF GREEN JOB OPENINGS BY ECONOMIC ACTIVITY Economic Activity Area (Clusters of Green Industries) Number of Green Jobs % of Available Green Jobs Pollution Reduction & Removal, Greenhouse Gas Reduction, and Recycling & Reuse2,87434% Natural Resources Conservation2,31028% Energy Efficiency1,54018% Environmental Compliance, Education & Training, and Public Awareness89711% Energy From Renewable Sources7249% Source: December 2010

39 T OP 10 INDUSTRIES WITH GREEN JOB OPENINGS Industry CodeIndustry Title Number of Green Jobs % of Available Green Job Openings 541 Professional, Scientific, and Technical Services1,33323% 611Educational Services5169% 921 Executive, Legislative, and Other General Government Support3947% 212Mining (except Oil and Gas)3426% 221Utilities3176% 562 Waste Management and Remediation Services3065% 236Construction of Buildings2404% 622Hospitals1943% 334 Computer and Electronic Product Manufacturing1422% 561Administrative and Support Services1312% Source: December 2010

40 A PPLICANT WORK EXPERIENCE REQUIRED Experience Required Non-Green Jobs Green Jobs Less than 1 Year11% 1 to 3 Years10%9% 4 to 7 Years24%33% 7+ Years8%16% No experience information provided48%32% Source: December 2010

41 E DUCATION AND WAGE PROFILE OF AVAILABLE A RIZONA JOB OPENINGS Education Required Non-Green Job Distribution Non-Green Jobs Median Salary Green Job Distribution Green Jobs Median Salary High School17%$27,04019%$33,761 Post Secondary/Some College5%$43,6806%$44,699 Bachelor's Degree25%$63,52550%$67,600 Graduate/Professional Degree3%$60,0007%$58,500 No Education Requirement Listed62%$39,27037% $49,500 Source: December 2010

42 O CCUPATIONAL P ROFILES 42

43 O VERVIEW Over 200 occupations identified through Arizona Green Jobs Survey 36 selected for in-depth occupational opportunity profiles Jobs require postsecondary education and/or certification Jobs have salary at least 85% of the state average wage At least 25 jobs reported through the survey Positive growth expected Compiled a database and web template for profiles, allowing easy updates/additions

44 R ECOMMENDATIONS FOR I MPROVED LMI W EBSITE 44

45 H OW O THER S TATES D ISSEMINATE LMI D ATA Number of State LMI Websites

46 C OMPARING O THER C HARACTERISTICS OF S TATE LMI W EBSITES Number of State LMI Websites

47 K EY F INDINGS – S UGGESTED F EATURES FOR A RIZONA Enable profile customization Include data visualization Google graphing Allow users to define their own region and compare it to the other regions

48 W RAP U P 48

49 S O W HAT ? Increased Market Demand for Green Economy-related products and services $5 trillion global market 78% of market comprised of the fastest growing segments: Energy efficiency, Renewable energy, and Greenhouse gas emissions reduction Dual benefits of “green economy” related to: Job creation in the short-term Energy independence in the long-term Lack of prior data about domestic “green activities” Provides Arizona with in-depth knowledge of the green economy Multiple research methods utilized to help show the full picture This knowledge makes Arizona more competitive Informs investment and policy decisions about… Training and certification programs Targeting of State Energy Sector Partnership investments Provides external stakeholder engagement in the research as well as the interpretation of results

50 T HANK Y OU 50


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