This article was published by the Pembina Institute on March 5, 2024.
By Megan Gordon, Janetta McKenzie
Ever since the framework for a federal emissions cap on oil and gas was announced on December 6, 2023, the conversation in Alberta has focused to a large degree on the perceived impact of the cap on the economy and jobs. In a submission to the federal government, the Alberta Minister of Environment and Protected Areas, Rebecca Schulz, stated that “Analysis from the Conference Board of Canada shows that it would reduce Canada’s GDP by up to $1 trillion between 2030 and 2040 and create up to 151,000 lost jobs across Canada by 2030.”
However, the economic “shocks” predicted in the Conference Board of Canada report fail to account for investments and initiatives outside of the traditional energy sector that could grow the GDP of Canada and Alberta and add new jobs to the labour market. Recent modelling undertaken for our Sustainable Jobs Blueprint report shows that 65,000 clean economy jobs could be added in Alberta by 2030 along the trajectory to net-zero emissions. By 2050, this number increases to 364,000 jobs. Alberta’s manufacturing sector alone is expected to add 80,000 jobs by 2030, which offsets the estimated 55,000 jobs lost in oil and gas over the same time period.
We expect to see net provincial job growth between now and 2030 in other key sectors such as services—i.e.wholesale and retail trade, transportation and warehousing, finance, professional, scientific and technical services, among others.
In the same modelling exercise, economic development policy interventions by government, including targeted tax credits, are shown to increase economic activity and create new job opportunities in Alberta across the clean energy industry and the entire economy.
Taking a proactive approach to economic diversification and job growth, the Alberta government can invest in workers and communities to strengthen the province and prepare it for the eventual slowdown and subsequent decline in global oil demand, which the International Energy Agency forecasts will start to happen by 2028.
In November 2023, the Pembina Institute’s report, Survival of the Cleanest, found that Canada’s oil sands, for the most part, will struggle to compete in a decarbonizing world economy. For this reason, we recommended that Alberta implement policies that will reduce emissions and prepare the sector to survive in a world of declining oil demand. We also recommend a complementary, coordinated and proactive sustainable jobs policy approach. Such an approach would ensure that climate action avoids uneven impacts to workers in high-emitting industries and paves the way for good-paying jobs in the clean energy economy.
Climate action and jobs aren’t mutually exclusive. We can make progress on both simultaneously with the right mix of regulation, incentives and responsible leadership.
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