Employment and Performance Effects of Circular Economy Innovations

Abstract

Circular economy (CE) describes an economic concept that aims at saving resources by minimizing the use of material and energy over the entire life-cycle or products, including repair, reuse and recycling. CE innovations help to realize the goals of a sustainable development and target both the environmental, economic and social dimensions of sustainability. This paper looks at the economic and social dimensions by investigating the performance and employment effects of CE innovations at the firm level. CE innovations such as the reduction of energy and material consumption or the recycling of waste, water or material may lead to cost savings which in turn can increase the competitiveness of the firm and raise demand for a firm's products. Our econometric analysis uses data of two waves of the German part of the Community Innovation Survey (CIS). The performance effects of CE innovations measured by the financial standing of a firm and by turnover growth tend to be positive. The results of quantile regressions show that this is also the case for employment effects.

Circular economy, sustainability and teacher training in a higher education institution

“…The employment opportunities derived from the application of the CE are one of the most important topics for the future of students (Horbach et al, 2015;Morgan and Mitchell, 2015). However, only one group included it in a proposal: "entrepreneurs who are dedicated to the repair of devices and work against planned obsolescence".…”

The heterogeneous skill-base of circular economy employment

“…Like the CE itself, CE employment has been defined in many different ways (Horbach et al, 2015;Van Oort et al, 2018). Following the focus on sustainability in public policy, many studies tend to define and label CE jobs as "green jobs" (Horbach et al, 2015) or jobs that contribute substantially to preserving or restoring environmental quality (UNEP, 2008, p. 3).…”

“…Most studies that have addressed CE employment focus either on estimating how many workers are active in the CE (e. or on calculating the net employment effect of the development of the CE, recognizing that the development of the CE may also crowd out or replace traditional industries. This body of literature has found that CE employment in Western nations typically accounts for between 0.5% and 5% of national employment (Horbach et al, 2015). 1 However, these figures might underestimate the true size of the CE because most studies focus on the 'green' component of the CE only and neglect the non-green jobs that enable the development of the CE (Van Oort et al, 2018).…”

“…1 However, these figures might underestimate the true size of the CE because most studies focus on the 'green' component of the CE only and neglect the non-green jobs that enable the development of the CE (Van Oort et al, 2018). 2 At the same time, there is mixed evidence regarding the positive net employment effects of the development of the CE, although generally positive employment effects are found with regard to the transition to renewable energy (Meyer and Sommer, 2014), savings of raw materials, and the development of eco-innovations (Horbach et al, 2015). 3 Despite the growing number of studies assessing the size, growth, and potential of the CE in terms of employment, there is little knowledge of the type of workforce the CE requires.…”

“…Building on the literature on gross employment in the CE (e.g., Elliott and Lindley, 2014;Bowen and Kuralbayeva, 2015;Horbach et al, 2015) as well as on the job analysis literature examining the skill intensity and knowledge bases of sectors and occupations (e.g., Autor et al, 2003;Acemoglu and Autor, 2011;Consoli and Elche-Hortelano, 2010), this article is among the first to examine the job requirements of the CE. To the best of our knowledge, only the work by Vona et al (2015) and Consoli et al (2016) addresses the question of whether green jobs differ from non-green jobs in terms of skills and human capital.…”