The safety net
When it comes to Net Zero targets, experts are hopeful that the goals we’ve set can succeed in shielding billions of people from the worst ravages of climate change. But are we setting ourselves up to catch everyone — or are some of our most vulnerable populations likely to fall through the cracks? Here’s why equity, inclusion and a thoughtful eye toward unintended consequences is a critical piece of the Net Zero transition.
Just two decades ago, the Canadian economy was riding high — in some regions, at least — on the boomtown promise of its oil and gas sector. Between 2001 and 2008, the oil and gas industry (alongside mining), drove half of the country’s increase in GDP among large firms.
The resource boom was more than welcome after a recession in the 1990s and fluctuating unemployment rates. But the energy and resources sector has changed rapidly since 2008, and so have our environmental practices. And as the oil and gas economy shifted amidst a years-long series of global, economic, industrial and technological evolutions, the carbon economy changed dramatically with a single report.
In 2018, the Intergovernmental Panel on Climate Change released a Global Warming of 1.5°C report, which said that, in order to meet the Paris Agreement's goal, every nation must cut its carbon-dioxide emissions in half by 2030, and neutralize them by 2050.
With that report, net zero became the overarching goal for countries and companies the world over. And while the race to net zero should represent a massive safety net for environmental concerns and climate change impacts, the transition will require a careful eye toward unintended consequences for our most vulnerable populations.
The race to zero
Rapid transitions in Canada’s energy sector are just one area where we are seeing a large swath of workers suddenly unemployed, or placed in precarious circumstances. Other sectoral shifts as we move to Industry 4.0, fast-increasing social inequality and urban densification, and black swan events like extreme weather and climate impacts are also creating volatility for vulnerable populations.
Historically, periods of major economic transformation — from the Industrial Revolution to the rise of e-commerce — have always been tumultuous, driving privation as well as prosperity. For Jim Coleman, head of economics at WSP UK, the current predicament is reminiscent of the restructuring seen in the UK in the 1980s, when the economy shifted from industry and manufacturing to services.
Crucially, there was an absence of coordinated planning for the communities most dependent on heavy industries such as coalmining and shipbuilding.
“There was an assumption that somehow the market would self-correct and that people would leave declining industries and go into growth industries, but that didn’t happen,” he says.
Falling through the cracks
The pandemic has given us an unfortunate preview of what can happen when certain sectors and populations are disproportionately affected by big, volatile shifts. We’ve seen deep-rooted social inequalities thrown into sharp relief, Coleman says, as oft-disadvantaged groups like women, young people and minority groups were hit the hardest by shutdowns in certain sectors, like hospitality, tourism, and retail.
The transition to net zero and other measures to address climate change could create 65 million new low-carbon jobs by 2030, according to the International Labour Organization (ILO). It posits that new opportunities in construction, electrical machinery manufacturing, copper mining, renewable energy production and biomass crop cultivation, could offset those lost in hydrocarbon energy. But we need a solid transition plan with an equity lens to help match these opportunities with those who most need them.
Much of this will rely on effectively re-skilling the workforce — which to this point, has been an underdeveloped element of the net-zero story.
“There is a huge disjoint between people coming out of declining sectors and the jobs opening up in new ones. You don't walk out of retail one day and into electric vehicle charging or installation the next,” says Coleman.
Continuing education could play a significant role, both for young people still in education and, perhaps more importantly, those already working who need to reskill for new career pathways. It could also address the challenges for those groups that have always struggled to be active in the workforce, for health, geographical or other reasons.
So far, few employers have created detailed action plans in terms of worker training and upskilling. However, this is an area increasingly scrutinized by investors, particularly as the disclosure of transition risks through mechanisms such as the Task Force on Climate-Related Financial Disclosures (TCFD) are now extending to workforce considerations.
Our chances of achieving net zero by mid-century will depend on striking a delicate balance between environmental, social and economic priorities, and learning from the mistakes of the past.
A seat at the table
Designing a net zero transition that is equitable, inclusive and economically effective will rely on social dialogue and listening to a diversity of voices. Our chances of achieving net zero by mid-century will depend on striking a delicate balance between environmental, social and economic priorities, and learning from the mistakes of the past.
“Everything that was achieved in the Paris Agreement will be jeopardized if we blindly focus on the environmental, even economic, imperatives, but fail to recognize wider social and political elements that question that logic,” says Elliott Cappell, climate change and resilience director at WSP Canada.
Issues such as social justice are inherently political — and therefore inherently divisive. But Cappell believes that it should be possible to depoliticize the net zero transition.
“If you focus too heavily on the social justice aspect, you risk accusations of being a ‘watermelon’ — that is, green on the outside but red on the inside.”
To avoid this, he says, every policy or investment decision should be presented not just in terms of long-term climate goals or social equality, but also tangible day-to-day benefits, which could be less divisive.
“For example, we know that addressing our aging building stock is a key area in terms of cutting emissions,” Cappell says. “The biggest concerns for people living in decades-old apartment towers are the broken elevators, the lack of air conditioning, the cold and draughts. By leveraging energy retrofits, we can rapidly create easily accessible jobs, cut emissions and provide more livable cities. Ultimately, that's what most people want.”
Transitioning to net zero with a social equity approach will require careful stewardship of all these factors — but if we manage it, the potential for economic, environmental and equity benefits are limitless.
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