How Do Environmental Policies Affect Jobs?
-- Discussion
Anne E. Smith, Senior Vice President
RFF First Wednesday Seminar
May 6, 2015
Projected Changes in Labor Earnings:
Partial vs. CGE w/ Full-Employment
Job-Eq. Impact Estimates
Rule
MATS (*)
Sectors Subject
to Rule
EPA
(“MPS” partial
model)
NewERA
(CGE model)
Electricity
+8,000
-71,000
(-15,000 to 30,000)
CSAPR
Electricity
+700
-34,000
(-1,000 to 3,000)
Boiler MACT
Non-Elec. Industries
+2,200
-28,000
(-4,100 to 8,500)
Source: Smith, Gans, and Yuan (2013), available:
http://www.nera.com/content/dam/nera/publications/2013/Chamber-Employment%20Impacts_FinalReport-w-Addendum.pdf
(*) MATS impact analysis was performed relative to baseline with CSAPR, as in RIA. The other 2 policies were analyzed
relative to a baseline with CAIR for comparability to EPA’s RIAs for those 2 rules.
2
A Few Comments on H-W’s “Initial
Findings”
Might be due to lack of
diversity among emitters
3
A Few Comments on H-W’s “Initial
Findings”
Might be due to lack of
inter-sectoral connections in
capital, energy, materials
4
A Few Comments on H-W’s “Initial
Findings”
Might be due to lack of occupational
skill & locational differences
5
A Few Comments on H-W’s “Initial
Findings”
Might be larger when accounting for
productivity impacts of emissions
control costs
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Conclusions
 Premature to conclude that job losses and job
shifts are small relative to overall policy cost
 Premature to conclude that partial analyses
overstate labor impacts compared to CGE
 Is reasonable to conclude that CGE modeling is
better for assessing net regulatory impacts to
labor
– whether modeled with or without involuntary
unemployment
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