The UK’s Emissions and Employment Footprints: Exploring the Trade-Offs

Marco Sakai,Anne Owen,John Barrett

doi:10.3390/su9071242

Abstract

During the last decades, the UK economy has increasingly relied on foreign markets to fulfil its material needs, becoming a net importer of both emissions and employment. While the emissions footprint reflects the pressure that consumption exerts on the planet’s climate, the labour footprint represents the employment that is created across the globe associated with the demand for products and services. This paper has a two-fold objective. First, it focuses on analysing the behaviour over time, drivers, and sectoral and regional composition of both UK’s footprints. Second, it explores the relationship between both measures by estimating the elasticity between the growth of emissions and employment embodied in imports. The results show that around half of the emissions associated with UK consumption were generated outside its borders, while only 40% of total employment was domestic. This has important policy implications. Reducing UK’s imports can contribute to cut both its footprints, generating less emissions abroad and more employment opportunities within. However, cutting imports is challenging, since this would require a lengthy and difficult process of structural transformation. The UK could contribute to curb emissions outside its borders, while safeguarding development overseas, by offering increased support to emission-intensive trade partners in the form of technology transfer and financial aid.

Highlights

Over the past decades, the increasing globalisation of markets has been reflected in a rapid and significant expansion of international trade
The UK is a net importer of employment embodied in traded goods
The amount of employment that it creates in foreign countries via international trade is greater than the amount of employment that is generated by its local export sectors

Summary

Introduction

The increasing globalisation of markets has been reflected in a rapid and significant expansion of international trade. According to data by the World Bank [1], the total volume of traded goods and services has grown almost twice as fast as global gross domestic product (GDP) since 1990 This phenomenon has been evident in developing nations, whose volume of trade rose by a factor of five during this period, while that of advanced economies grew by a factor of three. Companies increasingly found that outsourcing portions of the production process offshore was profitable, becoming a standard practice [4] Materials are, in this sense, extracted from diverse regions around the planet to manufacture and assemble products in different countries, to be distributed to yet other economies for consumption. A new trade reality has been forged, where the rise of global value chains has intensified the interdependence of nations

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Conclusion