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Mark Muro

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"Green Jobs": A Progress Report

Posted: 07/18/11 02:46 PM ET

So how are we doing on the "green jobs" promise?

Will the so-called "clean" or "green" economy really create "countless new jobs for our people," as President Obama promised in his State of the Union Address this year?

The question has always been hard to parse, and therefore controversial. However, last week my group at the Metropolitan Policy Program at Brookings released a big new report that sheds some light on the issue.

What did we find? We conclude the green jobs intuition is right, but the pace of its realization remains slower than hoped for, given its small present scale and the multiple market, finance, and policy challenges it faces. Which means that the real question for Americans and their leaders is whether the nation is ready to craft a stable growth platform for one of clearest likely sources of future job growth in America.

The basic "green" impulse is borne out, though. Our research team (working with the Battelle Technology Partnership Practice) embraced the sensible definitional approach of the federal Bureau of Labor Statistics, which will release the nation's first official "green jobs" measurement at the national and state level next year.

We then employed a painstaking methodology to count "green" establishments and concluded there were about 2.7 million "green jobs" in America in 2010. Some 500,000 new "green" jobs had been created since 2003, and the pace of their creation if anything accelerated during the national and global recession.

And one segment of the clean economy, newer "cleantech" industries -- ranging from wind and solar energy to smart grid applications and professional energy services -- grew twice as fast as the rest of the economy.

What's more, the clean economy is nearly three times as oriented to manufacturing as the rest of the economy while offering substantially more accessible jobs for better pay than the economy at large. "Green" jobs in solar installation or energy efficient appliance manufacture or mass transit (yes, transit is "green") are attractive ones highly relevant to the providing opportunity in U.S. regions. In short, the data confirm that the clean economy really is producing an array of job opportunities important to the nation's need to renew its economic base and rebuild the middle class.

And yet, it must be said that the clean economy remains at present more an appropriate ambition than a large source of near-term employment. A fraction of the size of the health-care industry, for example, the clean economy remains modest-sized in the larger scheme of things. After all, remember that at least 8 million jobs that were lost in the Great Recession. What is more, the dynamic, super-promising cleantech sector remains smaller still, and contains no more than a few hundred thousand jobs, while the broader "green economy" contains significant numbers of mature or public-sector establishments that will not likely yield substantial growth in the future.

The bottom line: The "green jobs" promise is legitimate and compelling, but the scale and pace of the clean economy's present build-out remains more modest than the great expectations that have been placed on them.

So where does that leave us?

For one thing, the data counsel against excessive hopes for large-scale, near-term job creation from the sector. While key cleantech industry segments are posting near double-digit annual growth at a time of sluggish national progress, the fact is that their status as major employers in most regions remains a few years off.

Beyond that, there remains the matter of policy. The fact remains that the growth of the clean economy has almost certainly been depressed in recent years by the nation's chaotic, inconsistent, and partisan policy disputes.

America, its industries, and its regions are in many places making solid progress on clean economy development, especially at the early-stages of the technology commercialization pathway, where new ideas, business plans, and firms come into being. However, much evidence suggests the scale-up of these ideas has not been maximized, and that owes in part to a series of serious and unresolved policy problems that have left domestic demand weaker than it might be, financing harder to obtain, and the innovation pipeline unsecured for the future.

In that sense, the most nagging question to me this summer is not whether the "green jobs" promise is legitimate, but whether America wants to reap its potential benefits.