The Institute of Public Affairs (IPA) was among the first organisations in Australia to quantify the potential employment impact of a policy of net zero emissions by 2050. In April 2022, the IPA released its landmark report, The Economic and Employment Consequences of Net Zero Emissions by 2050 in Australia, which estimates the potential costs of a policy of net zero emissions by 2050 in terms of forgone economic production and job creation.
That report identifies that a policy of net zero emissions by 2050 would prevent the construction of the 89 coal, gas, and oil projects which are currently in the pipeline across Australia. This would come at a cost of approximately $274 billion across the Australian economy in terms of forgone economic output, which is the equivalent to approximately 14% of the nation’s annual GDP, and prevent the creation of approximately 480,000 jobs.
The report also highlights that communities in regional Australia would incur the greatest costs. For example, in the Hunter and Newcastle region, the report estimates that net zero would cost $11.5 billion in foregone economic output which is the equivalent to 20% of annual gross regional product. This will prevent the creation of approximately 21,800 jobs which is the equivalent to around 6.7% of the current local workforce and 4 years’ worth of job creation.
The aforementioned research report builds on an earlier study, Net Zero Emissions Will Divide Australians: A State-based Electoral Analysis of the Impact of Net Zero Emissions, which finds that it would be regional Australians who would most likely lose their jobs as a result of net zero – not residents of major capital cities like Sydney, Melbourne and Brisbane.
Sadly, the impact of net zero is already being felt in regional communities across Australia – and in the Hunter more specifically. Net zero is directly responsible for “the rapidly changing conditions in the national electricity market” blamed by Origin Energy as the reason for the early closure of Eraring, Australia’s largest power station which is responsible for more than 20% of New South Wales’ electricity production.
Early estimate suggests that the direct employment implication arising from the closure of Eraring is the loss of up to 1,000 jobs. A new study by the IPA, entitled The Employment Consequences of the Early Closure of the Eraring Power Station, finds that the figure is likely around 40% higher. This is particularly concerning because most of the jobs lost due to Eraring’s decommissioning will be stable, high-paying, permanent, full-time positions.