The green economy has come of age: now let’s give it the statistics it deserves

Green economy2This post by Green Alliance’s chief economist Julian Morgan first appeared on BusinessGreen.

Visit the ONS website and you will find many interesting statistics, but perhaps not the ones that you are looking for. Last week I stumbled across a very salient example. Under the heading “manufacture of measuring, testing and navigating equipment” you can find monthly data on the average earnings of those making watches and clocks. Indeed, I noticed that they seem to be doing rather well, as provisional estimates suggest their pay rose 3.6 per cent in the year to March 2013.

The stats are behind the times
Dame Ellen MacArthur may rely on the makers of navigational watches and clocks, but I doubt there are many who would see a high priority in having monthly updates on their pay. I am often surprised how the choice of things we collect statistics on appears to lag way behind the current economic reality. For instance, more official statistics seem to be collected for sectors that used to be large, such as agriculture and industry, than for the now dominant service sector.

Nowhere is this more true than in relation to green business. Last week BIS released its latest update of the report and statistics on Low Carbon and Environmental Goods and Services (LCEGS). These figures suggest that total sales of companies classified as belonging to this sector rose by a little under five per cent in the financial year 2011-12. Coupled with anecdotal information, such as the recent opening of the London Array, it supports the message that this sector is growing.

Green business needs the attention of the ONS
The BIS data have been helpful in quantifying what was a new industry and it should be commended for putting some early information on the green economy into the public domain. It has been necessary because the standard statistical classifications, developed long ago and only updated periodically, do not enable us to identify the contribution of low carbon and environmental activities, despite their increasing importance to our economy. Instead, these activities have been lumped together with other more traditional industrial and service activities.

This gets more and more absurd with each passing year. Green business is no longer niche, it’s a key part of the mainstream economy. Indeed in some areas, such as the official infrastructure pipeline, low carbon projects are now the dominant activity. Yet, at the moment, we lack comparable information on the value-added of such activities or the wages of people working in the green economy. It’s time to ask the ONS for more standardised, timely indicators, which are subject to the recognised scrutiny of our official statisticians.

Better understanding will lead to better policy
I am not saying that collecting figures such as those of the pay of watch and clock makers has no merit. But that, in these times of scarce resources, shouldn’t we be focusing our efforts on those dynamic sectors which are on their way up? We need to understand better what contribution growing activities are making to the overall economy. This will help us formulate the right policies to ensure that the UK is well placed to benefit from their continuing growth.

Low carbon and environmental goods and services have become a vital growth sector. The BIS figures are already showing this but, now the sector has grown up, it surely merits the attention of the nation’s official statisticians.  For how much longer will we know more about the pay of watch and clock makers, than we do about those that are building our low carbon future?

2 comments

  • I would agree and go on to say that we should be able to monitor a move to towards a green economy and away from a carbon based one. Could we measure investments in green technologies v investments in carbon, to help people divest.
    We should also be able to compare green jobs with services, conventional industry and watch makers, as this will enable measurement of progress in any transition to a green economy.

  • Reblogged this on Bright Green Dragon and commented:
    The Green Economy has grown 5% in the past financial year and steady, sustainable growth is predicted to continue. The sector employs nearly a million people in the UK. These are reasons to be proud, and optimistic but as this Green Alliance blog illustrates we need to analyse the data on the Green Economy more thoroughly to understand and capitalise on this sector and to maintain our position amongst world leading green economies.

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