Jobs for Tomorrow Canada s Building Trades and Net Zero Emissions

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1 Jobs for Tomorrow Canada s Building Trades and Net Zero Emissions A study on the construction industry s role in Canada s transition to a low carbon economy Executive Summary Page 1 November 2017

2 ABOUT THIS STUDY Jobs for Tomorrow was commissioned by Canada s Building Trade Unions and written and published by Columbia Institute. To date, very little research has been undertaken on the construction industry s role in Canada s ongoing economic restructuring and low-carbon development. This study marks the first-time original research has been undertaken to examine potential impacts on Canada s construction industry. THIS PAPER EXPLORES some possible implications for the building trades in the context of global warming and Canada s commitments to climate action. The construction industry plays a critical role in the national economy by supporting production in all other sectors. Rather than resulting in net job losses, a net zero Canadian economy has the potential to create huge opportunities for those in construction and other industries. As one of 197 international signatories to the Paris Agreement, Canada has pledged to achieve net zero emissions a balance between greenhouse gas emissions and their absorption across Canada by natural and man-made means between 2050 and 2100 in order to keep global warming below 2 C and work toward 1.5 C of warming. Without policies in place to address global warming, the world is on track to reach average temperatures of over 4 C by the end of this century. Canada s current national commitment is to reduce emissions by 30 per cent below 2005 levels by This paper goes beyond Canada s current commitments, accelerating the transition to envision an aspirational scenario in which the Canadian economy has achieved net zero by This study was launched at a Concert Properties construction site in Vancouver on August 10th to a gathering of media and Building Trades members working on the site. Since its release on August 10th, this study has received significant media coverage and interest in the findings continues to pour in from Canada and around the world. Page 2 November 2017

3 ABOUT CANADA S BUILDING TRADES UNIONS Canada s Building Trades Unions (CBTU) are a major stakeholder in the construction industry, which has a critical role to play in the transformation to a low-carbon economy. The national organization has a membership of more than half a million construction workers, who are employed in more than 60 different trades and occupations. The total construction labour force is made up five categories under Trades, Transport and Equipment Operators and related occupations. These are: Industrial, electrical and construction trades Maintenance and equipment operation trades Other installers, repairers and servicers and material handlers Transport and heavy equipment operation and related maintenance occupations Trades helpers, construction labourers and related occupations. As an umbrella organization for construction unions in Canada, the following international unions are affiliated with Canada s Building Trades Unions (CBTU). International Brotherhood of Boilermakers International Association of Bridge, Structural, Ornamental and Reinforcing Ironworkers International Association of Heat & Frost Insulators & Allied Workers Operative Plasterers' and Cement Masons' International Association of the U.S. and Canada International Brotherhood of Electrical Workers International Brotherhood of Teamsters International Union of Bricklayers & Allied Craftworkers International Union of Elevator Constructors International Union of Operating Engineers International Union of Painters and Allied Trades Labourer's International Union of North America Sheet Metal, Air, Rail and Transportation Workers United Association of Journeymen and Apprentices of the Plumbing and Pipefitting Industry of the U.S. and Canada United Brotherhood of Carpenters Unite Here Page 3 November 2017

4 GLOBAL CONTEXT A massive transition is underway worldwide. Countries are decarbonizing their infrastructure, industries and economies in order to stave off the worst impacts of climate change. This shift is gathering speed and will impact all sectors of our society. 197 nations have signed on to the Paris Agreement agreeing to slash greenhouse gas emissions in order to keep global warming below 2 degrees Celsius. The global transition to a lowcarbon economy will require an investment of less than 4% of the current total global annual investment in construction activity. Recent studies indicate that over the past three years the global economy grew while greenhouse gas emissions from energy production and delivery declined. Page 4 November 2017

5 The International Trade Union Confederation forecasts that investments of 2 per cent of Gross Domestic Product (GDP) in the green economy over a 5- year period in 12 countries could create up to 48 million new jobs or up to 9.6 million new jobs per year including more than 17 million jobs in the construction sector. The World Green Building Council (WGBC) has called for all buildings to be net zero by 2050 through new construction and deep renovation. (Homes and buildings account for one-quarter of all of Canada s emissions.) As the move to build a post-carbon world accelerates, the building trades are seeing benefits for their members globally. CANADIAN CONTEXT Canada s ability to meet its Paris commitments will be based on the construction of new infrastructure for the generation of electricity using renewable sources. Serious efforts to decarbonize the Canadian economy will create significant opportunities for those in construction trades. Getting to net zero in Canada will mean replacing GHG-emitting sources of power with clean energy. At the same time, Canada s population is projected to grow to 48 million by Page 5 November 2017

6 Historically, a statistical relationship exists between oil and gas sector value-added and GHG emissions, in which both variables move in the same direction : During the recession, both variables declined due to falling demand for energy. Mid-2000 s : A similar pattern is seen during periods of growth and economic recovery. These fluctuations are characterized by short-term business cycles and driven by changes in the Canadian economy. In 2014 on the far right of the chart, there is a divergence between oil and gas sector value-added and GHG emissions. Researchers believe this indicates a delinking or decoupling of the economy from the oil and gas industry. And this is consistent with global trends. Page 6 November 2017

7 KEY FINDINGS Note: o Targets in this report go beyond Canada s current green house gas emissions targets and are in-line with the Paris Agreement goals of working towards keeping global warming to 1.5c degrees. o This is an aspirational scenario that shows the job impacts of achieving net zero by o A job in this report means a year of direct employment in the construction industry (1500 hrs). o While these estimates are rough, we believe they are also conservative. Building Trades and Net Zero Emissions The construction industry has a vital role to play in meeting Canada s climate goals by supporting production in other sectors including electricity generation, efficient buildings and new transportation infrastructure. Canada s ability to meet our climate goals will be based on the construction of new facilities for the generation of electricity using renewable sources, including hydro, wind, solar, tidal, biomass and geothermal energy. In addition, it will require the construction and maintenance of more efficient buildings and transportation infrastructure. These net-zero initiatives will require the work of a variety of trades people including masons, boilermakers, pipefitters, insulators, electrical workers, glaziers, HVAC, linemen, ironworkers and other construction trades. Page 7 November 2017

8 Electricity Supply: Building Tomorrow s Grid Building tomorrow s grid will result in significant jobs for Canadian construction workers. Moving to an electrical supply grid composed primarily of hydroelectric (40 per cent), new wind, solar, geothermal, and tidal power generation (44 per cent combined), and legacy nuclear (5 per cent), would result in over 1,048,900 direct construction jobs by This total assumes a low-end 2050 demand scenario. Here s how it breaks down: Wind power: at 25% by 2050 creates 209,360 full-time construction jobs; Solar power: at 10% by 2050 creates 438,350 construction jobs; Tidal and wave power: at 5% by 2050 creates 109,770 construction jobs; Geothermal power: at 4% by 2050 creates 30,300 jobs for construction workers; Hydroelectric power: at 40% by 2050 creates 30,760 person-years of construction employment; Nuclear power: at 5% by 2050 creates 30,360 construction jobs; and Transmission line construction would create 200,000 construction jobs. Smart Communities: Efficient Buildings and District Energy Systems Net zero building retrofits and new green commercial, industrial, and institutional building construction are predicted to account for 1,997,6401 direct non-residential construction jobs. Building small district energy systems in half of Canada s municipalities with populations over 10,000 would create almost 22,000 construction jobs by Transportation Building out $150 billion of urban transit infrastructure including rapid transit tracks and bridges, subway tunnels, and dedicated bus lanes between now and 2050 would create about 245,000 direct construction jobs. IN TOTAL, MEETING CANADA S CLIMATE GOALS could generate over 3.3 million direct jobs in the building trades by 2050, and 17 million jobs if induced, indirect, and supply-chain jobs are included. Page 8 November 2017

9 PATHWAYS What are the Pathways to Jobs in a Low-Carbon Economy? The report includes a case study on the remarkable work in California that has generated hundreds of thousands of good, union jobs that contributed to decreasing GHG emissions. This was driven largely by a public policy known as the Renewable Portfolio Standard (RES) that required utilities to include a larger percentage of renewables. And was supported by government-led partnerships to provide training and apprenticeship opportunities. This economic transformation on a global level will require an investment of an additional US$220 billion by BUT - This is less than 4 per cent of the current total global annual investment in construction activity ($8.5 trillion/year). Returns on this investment could be as high as 124 per cent if ambitious policy and technology actions are taken. Page 9 November 2017

10 CONCLUSION As the global movement to net zero emissions accelerates, the building trades are seeing the benefits for their members. In BC and across Canada, good jobs could be a significant, added benefit of climate action. Page 10 November 2017