Press Story

Green goods and services contribute just 4 per cent to UK GDP, vs 6 per cent across the EU, 11 in Sweden and 11.5 per cent in Denmark
UK could have created almost 100,000 more jobs in wind industry if it had followed Denmark’s example and built up domestic manufacturing
UK public investment commitment into low-carbon technologies is among the lowest in the G7, IPPR report finds

A newly released report by the Institute for Public Policy Research (IPPR) reveals how badly the UK is trailing in harnessing the economic advantages from the shift to net zero, primarily due to the lack of a green industrial strategy.

IPPR's new analysis reveals a stark discrepancy between the UK and its European counterparts when it comes to the green goods and services sector's contribution to the GDP—standing at a mere 3.9 per cent in the UK as opposed to the EU's 5.8 per cent, with nations like Sweden and Denmark surging even further ahead (10.9 per cent and 11.5 per cent), based on the most recent comparable figures (see chart in Note 3 below).

The report emphasises the huge opportunity that the net zero transition offers, pointing to the 1.6 million jobs that could be created and the potential for up to 2.4 per cent to be added to UK economic output (GDP) by 2030. However, the nation’s ability to exploit the green growth potential is being hamstrung by the lack of a green industrial strategy, coupled with inadequate public investment in the net zero economy.

Despite recent claims of UK leadership, new analysis by IPPR has found that public investment commitments into low-carbon technologies are among the lowest in the G7 group of leading western economies. Additionally, when compared to most European nations, the UK has a lower percentage of people working in the renewable energy sector. If the UK's wind industry matched Denmark's performance, it could yield an extra 98,000 jobs, or 20,000 more if on par with Germany.

This discrepancy, according to IPPR, stems from the interaction of public research, strategic investment, and industry coordination seen in other countries — a collaboration glaringly absent in the UK. A testament to such coordinated strategy is Denmark, only the 17th largest wind capacity (compared to sixth for the UK) but the home to one of the world’s largest wind turbine manufacturing industries.

The report casts a spotlight on the global green race where other nations are accelerating ahead, whilst the UK seems to be in reverse gear. This is typified by the US’s Inflation Reduction Act and EU’s responsive measures, contrasted with the UK’s delay to the ban on the sale of petrol and diesel cars, deferral of the phase out of gas boilers, and the scrapping of energy efficiency standards for landlords.

IPPR is calling on all political parties to bring forward a green industrial strategy and raise public investment in net zero and nature to maximise the substantial economic benefits of the transition to a greener economy.

Luke Murphy, associate director at IPPR, said:

“The UK is at a pivotal juncture. While other nations are forging ahead in the global green race, the UK is moving into reverse gear.

“The absence of a robust green industrial strategy is not only a missed economic opportunity but a dereliction of our global responsibility in combating climate change. We must set a new course, capitalising on the green growth potential to spur job creation, innovation, and sustainable prosperity.

“Every further day of inaction is costing us valuable jobs, technological advancements, and a sustainable future.”

Josh Emden, senior research fellow at IPPR, said: 

“Our analysis highlights the glaring disparity between the UK and its international competitors in harnessing the economic boons of the green sector.

“The roadmap to net zero is not just a climate necessity but an economic opportunity waiting to be tapped.

“With a green industrial strategy and robust public investment, the UK can not only catch up but lead the green economic frontier.”

ENDS 

Luke Murphy and Josh Emden, two of the report’s authors, are available for interview  

CONTACT 

David Wastell, Director of News and Communications: 07921 403651 d.wastell@ippr.org 

Liam Evans, Senior Digital and Media Officer: 07419 365334 l.evans@ippr.org  

NOTES TO EDITORS

The IPPR paper, From missed chances to green advances: The case for a green industrial strategy, by Josh Emden, Luke Murphy, Dave Hawkey, Pranesh Narayanan, and Simone Gasperin, will be published at  00:01 on Thursday 5 October 2023
Advance copies of the report are available under embargo on request
IPPR (the Institute for Public Policy Research) is an independent charity working towards a fairer, greener, and more prosperous society. We are researchers, communicators, and policy experts creating tangible progressive change, and turning bold ideas into common sense realities. Working across the UK, IPPR, IPPR North, and IPPR Scotland are deeply connected to the people of our nations and regions, and the issues our communities face. We have helped shape national conversations and progressive policy change for more than 30 years. From making the early case for the minimum wage and tackling regional inequality, to proposing a windfall tax on energy companies, IPPR’s research and policy work has put forward practical solutions for the crises facing society. www.ippr.org