7. Modelling job creation in the circular economy in Flanders

Modelling job creation in the circular economy in Flanders

Gwen Willeghems (Summa), Kris Bachus (Summa)

May 2019

7. Modelling job creation in the circular economy in FlandersFramed within the Flemish policy research centre Circular Economy, this research paper is the second output of the research line that studies employment and actor analysis for the circular economy (RL 6).

This research paper present the summary of an assignment conducted for the Department of Work and Social Economy of the Flemish Government, with support from the Flemish policy research centre Circular Economy. The goal of this research paper is to investigate the impact of the transition to a more circular economy in Flanders on employment. In order to be able to estimate this impact, we firstly want to understand what “the circular economy” actually means and how we can demarcate it at NACE-code level. Secondly, we want to get an idea of the characteristics of employment in the circular economy sectors we define at company and employee level. Finally, we want to make an estimate of the potential job creation of the transition to a more circular economy.

Looking at the general impact of the circular economy on employment, existing studies generally predict a net increase in jobs, although some existing jobs may be lost. It also appears that, depending on the type of action in the circular economy, the effects vary, both for the different levels of skilled labour (i.e., low, medium, high-skilled) and for geographic location (local, regional, global). Moreover, while some existing occupations may be lost, new professions may be created, or changes may occur at the level of the tasks within a particular job, with some specific tasks being replaced by others.

Our own exploratory analysis for Flanders for the period 2010-2016 showed that:

  1. the circular economy employment index rises faster than the average Flemish employment index;
  2. employment in the circular economy mainly consists of low- and medium-skilled workers, meaning that the CE is an important growth sector with significant employment opportunities for these groups;
  3. the circular economy in Flanders is a predominantly male sector, and
  4. no specific spatial patterns were discovered in the location of the circular companies and the circular employment. It was clear, however, that some municipalities stand out in terms of circular jobs as percentage of total number of jobs.

Finally, we estimated the employment potential of the Flemish circular economy using regional input-output tables and based on two approaches. The first approach, based on estimating the increase in value added per sector, taught us that, by 2030, potentially more than 30,000 jobs could be created in the circular economy. The second approach, although it did not provide an absolute number for possible future job creation, indicated in which of the selected circular economy sectors most jobs would be created if final demand in these sectors increases. When comparing both results of the input-output approaches, it appeared that there was overlaps in the biggest employment potential, particularly in the machinery repair sectors (NACE_C - 33.1), rental and leasing (NACE_N - 77.2), and repair (NACE_S - 95.1 and 95.2). It is important to bear in mind that these sectors are relatively small in terms of turnover and number of employees compared to, for example, NACE_E (sewerage, waste management and remediation activities) and NACE_G (motor vehicles, wholesale waste and scrap, and second-hand retailers), which showed lower potential in terms of conversion keys or employment multipliers.

Download

CE Center co-authors:

 

Promotor Circular Economy Policy Research Centre

 

(*Former) Researcher Circular Economy Policy Research Centre