But Committee warns a 'hands-off approach will not work' as it urges government to grasp green growth opportunity in face of increasing competitive threat from US and EU

Decarbonising the UK economy has the potential to deliver a net employment increase of up to 725,000 jobs, but more direct government intervention is needed to grasp this opportunity and reskill workers in carbon-intensive sectors to tackle a looming green skills crunch.

That is the conclusion of a new study today from the Climate Change Committee (CCC), which argues that most of the UK workforce is unlikely to be significantly impacted by the transition to a net zero emissions economy over the next three decades.

The report predicts the pursuit of the UK's statutory 2050 net zero emissions target is likely to create hundreds of thousands of new jobs across the breadth of the UK economy. But it also highlights how green jobs are likely to be concentrated in industries such as construction, green home retrofitting, renewable energy, and electric vehicle (EV) battery manufacturing.

With targeted intervention from the government, it estimates the net zero transition has the potential to boost net UK employment by between 135,000 and 725,000, including in many of the UK's more economically deprived areas and communities.

But the CCC stressed the government had so far been "slow to respond" to growing competition for green investment, as evidenced by the USA's Inflation Reduction Act and the EU's proposed Green Deal Industrial Plan, which it warned had "increased the risk to [UK] industry competitiveness".

"Without support for industry to maintain competitiveness and jobs, there is a risk that jobs could be lost," the report warns, echoing repeated warnings from businesses over the past year who have warned green investors and employers could quickly migrate away from the UK to take advantage of more generous subsidies and policy support frameworks in the US, Europe, and Asia.

The CCC report models the employment of the UK meeting its net zero targets, calculating that only a fifth of the UK workforce - around 6.3 million workers - would experience significant changes to their roles as a result of the net zero transition. Around two-thirds of these roles are in sectors that are set to grow in the coming decades, such as in green building construction and in the electric vehicles value chain.

The report also acknowledges that the transition presents considerable risks to high carbon sectors. Roughly seven per cent of UK workers are in sectors that will need to gradually redirect their products and services in order to decarbonise, the report estimates, with most of these roles concentrated in industries, such as steel and cement manufacturing, that are at present reliant on the use of fossil fuels.

But the climate advisory body contends the overwhelming majority of workers likely to be in any way negatively affected by the net zero transition can be upskilled or reskilled to meet changing demands in their sector.

The report estimates less than one per cent of the UK workforce is situated in high emitting sectors that are likely to need phasing down over the course transition - most notably oil and gas - where production must significantly decline to achieve net zero.

In order to manage these risks and seize the employment opportunities offered by the net zero transition, the CCC urged the government to deliver stronger and more targeted policies to respond to the UK's rapidly changing skills requirements, particularly in high carbon sectors, warning that "a hands-off approach will not work".

It stressed direct government intervention would not be needed in every sector of the economy, but clearer policy direction would still be needed, backed by a responsive education and skills system to foster a smooth transition. More efforts should also be made to increase the diversity of the workforce in certain sectors that are key to the transition but where women and ethnic minorities are currently underrepresented.

At present, however, options for developing the UK's net zero workforce are not being considered systematically across government, the CCC warned.

"The UK has committed to net zero - the only question is whether the government intends to get there in a way that benefits workers or leaves them behind," said Lord Deben, the CCC's chair.

"This is a unique moment to tailor our approach to skills and jobs, in the certainty of achieving the legal goal A net zero workforce means secure employment for the future. This is an opportunity for the government to bring real meaning to 'levelling up'."

The findings add to the weighty pile of evidence that the UK's 2050 net zero target offers huge economic opportunities across multiple sectors. To date, the CCC estimates the UK's net zero journey has already created a quarter of a million new jobs.

But the research also underscores the need for rapid and concerted action from government to grasp these opportunities and avoid the same pitfalls that characterised the economic shifts that dominated the second half of the 20th century, such as the deindustrialisation drive that left many unemployed in coal mining and steelmaking communities in the 1970s and 1980s.

"Net zero need not carry the same risks," the CCC said. "Decarbonisation will reduce demand for certain goods and services, but the few sectors that may see job losses will see a pace of change more gradual than the coal and steel transitions of the past. Clarity on government's aims will give businesses and workers time to respond."

The CCC's report highlights particular opportunities for stronger green skills policies in the UK's industrial manufacturing heartlands, including areas such as South Wales, the Humber, Grangemouth, Teesside, Merseyside, and Southampton, all of which employ significant numbers of workers in manufacturing and are also areas earmarked for the development of net zero clusters for green industrial technologies such as hydrogen production and carbon capture and storage facilities (CCS).

The government has committed to publishing a 'Net Zero and Nature Workforce Action Plan' early next year, which the CCC is pushing Ministers to use to take account of its recommendations. Responding to today's CCC recommendations, it insisted its plans for the net zero transition would benefit workers and the economy.

"Our plans for green jobs will ensure no workers are left behind - in fact, far from a hands-off approach, we are investing nearly £4bn in supporting people to retrain and have seen £110bn of new investment into renewables since 2012, helping industries across the economy to cut their emissions and become sustainable for the long term," the Department for Energy Security and Net Zero said in a statement. "On top of this our Plans to power up Britain are expected to attract a further £100bn investment in green industries of the future and support 480,000 jobs by 2030, helping to level up communities across the country."

However, while Greenpeace UK's policy director, Dr Doug Parr, said the CCC's report "thoroughly rejects any scaremongering that the net zero transition will be bad for UK jobs", he warned the huge economic potential offered by decarbonisation could only be realised with requisite intervention from the UK government.

"Our economy won't benefit without the right government assistance for workers who need retraining, and sectors that need support," he said. "It must prioritise working with the communities most affected to attract new employment as the old jobs disappear.

"The government must show it matches the drive, policy and green finance shown by the US, China and the EU otherwise we will continue to lag behind in the international race on clean tech."

Green Party MP Caroline Lucas said the CCC's report exposed "colossal gaps" in the government's green jobs plans, driven by underinvestment in the green economy over the past decade and a half, and a failure to prepare the UK workforce for a net zero transition that is already underway.

"Ministers can't simply wave a magic wand and expect green jobs to appear, or rely on the market alone to dream up a solution," she said. "We need to see political will across Whitehall to properly invest in reskilling and retraining workers in the green industries of the future.

"Yet while the US and the EU speed ahead, we're lagging desperately behind," Lucas added. "The world won't wait for us - the opportunities are there for the taking."

Sarah Mukherjee, CEO of the Institute for Environmental Management and Assessment (IEMA), also welcomed the CCC's findings today, as she urged the UK government and global policymakers to ensure green skills and training are central to climate negotiations at the COP28 Climate Summit in Dubai later this year.

"The CCC is right to push green jobs, and the skills needed to deliver them, up the agenda," she said. "IEMA is calling on delegates at COP28 in the UAE to add a commitment to green skills and training to the final cover text of the negotiations, in order to give the world the best chance of action at the pace and scale needed to avoid climate breakdown."