By Paul Homewood
From the Institute of Economic Affairs:
In his Party Conference speech on Wednesday, Jeremy Corbyn unveiled plans to kick-start a “green jobs” revolution, pledging to create 400,000 skilled posts in the low carbon sector. But do these claims stand up to scrutiny?
One flaw in any plan to use low carbon industries to ‘create jobs’, is that many parts of it tend to be capital intensive and people light. This is evident in Labour’s own modelling. They pledge to spend £12.8 billion on a home insulation programme they say will create 160,000 jobs. This works out at a cool £80,000 of subsidy per job created.
State-funded job creation, moreover, can carry huge costs (and opportunity costs). ‘Public money’ does not materialise from thin air, it inevitably involves diverting resources from elsewhere. If funded by government borrowing, it risks ‘crowding out’ of private investment. If not, increased…
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