Green Workforce Needs of Minnesota Businesses

by Rachel Vilsack - rachel.vilsack@state.mn.us
June 2009

Recent local and national news stories have discussed what seems to be a new trend toward businesses “going green” and a swelling number of “green-collar jobs.” Green businesses are broadly considered to be those that have environment-friendly operations or that provide products and services that are beneficial to the environment by minimizing their impact on the environment. Examples include businesses as diverse as a manufacturing firm that makes a biodegradable cleaning product, an architectural firm that promotes energy efficiency through its building designs, or a utility plant that turns wind power into electricity for its customers.

What is often missing from the news stories is an assessment of the workforce skills needed for these green-collar jobs. Some workers employed by green businesses may require new and unique skills not needed by other occupations. For instance, knowledge of environmental policies and regulations may be necessary for workers who create a product that has an environmental certification. Other skills might include minimizing waste, managing hazardous wastes, or using green materials in the manufacturing or construction process. These skills are not just limited to goods-producing jobs. Green jobs in architecture, interior design, even engineering may require additional environment-specific skills. These are just some of the jobs often referred to as green-collar jobs. While not all jobs in a green industry will require specific skills, it is important to identify the core skills needed by occupations critical to the growth of Minnesota’s green economy.

Background

Many organizations have attempted to define Minnesota’s green industries and quantify the number of green jobs. Most notable is the Green Jobs Task Force, established by the Minnesota Legislature in 2008 to advise the governor and Legislature about activities to advance the state’s green economy. The Green Jobs Task Force commissioned a market analysis report, conducted by GPS Consulting Corp., which estimates that Minnesota has 58,827 green jobs in industries spanning green products, renewable energy, green services, and environmental conservation. [1]

The report identified 38 “pure green” occupations (such as soil and plant scientists, conservation scientists, and hydrologists), 110 “green impacts” occupations (such as chemical engineers, plumbers, and power plant operators) and 430 “potentially green” occupations (such as chief executives, teachers, and lawyers). While the educational pathways for many of these occupations are clear, the types of specific green skills that may be needed are not.

Some of these green skills could, of course, be learned through on-the-job training. Other skills, especially if the occupation requires some form of post-secondary degree or certification, could be learned through a formal training program. Either way, if businesses are becoming more aware of their impact or their products’ impact on the environment, finding a well-prepared future workforce will be essential.

In an effort to learn more, the Minnesota Department of Employment and Economic Development (DEED) partnered with the Minnesota Department of Commerce during the winter of 2008 to survey employers across the state to identify their current and future involvement in green practices, production of green products, or offering of green services.

Businesses from all sectors of the economy were surveyed, although the sample was constructed to be larger in industries where we expected to find green jobs. Approximately 12 percent of the businesses surveyed responded making these findings insightful, but not conclusive. Business responses came from firms in manufacturing, construction, energy production and distribution, government, and business and professional services.

A Definition of “Green”

The North American Industrial Classification System (NAICS), which is the nationally recognized method for classifying industries, does not allow us to identify business entities that are involved in producing or offering green products or services, or the degree to which their workers need green skills. This classification system provides a high level of specificity as to the primary product or service of each business. Businesses that produce some green products (such as a wind turbine manufacturer) or provide green services (such as environmental consulting) may be easy to identify. Others, like energy-efficient window-and-door manufacturers or firms that offer green architectural services, may not be as easily identified. Additionally, workers within any industry sector span a variety of occupational fields, so not all employees of a particular firm would be classified as working a green job.

For the purpose of this study, businesses were surveyed from industry sectors that had the greatest potential to be involved in offering green products or services now or in the future. Examples of industries targeted include:

Utilities – solar, wind and hydroelectric power, energy storage, energy transmission/distribution

Construction – home construction; industrial building; residential remodelers; residential plumbing; heating, ventilating and air conditioning (HVAC); glass and glazing; roofing; siding; electrical; drywall; insulation

Manufacturing – HVAC equipment manufacturing, glass manufacturing, paper mills, electric lamp bulb and fixture manufacturing, household appliance manufacturing, power distribution and transformer manufacturing, battery manufacturing, automobile manufacturing, biofuels

Administrative and Support Services - recycling, waste collection, and remediation
 
Business and Professional Services – industrial design services, environmental consulting services, architectural services, engineering services

Government – conservation and pollution prevention, cleanup/safety, monitoring and compliance

Since the term “green” could include firms from many sectors of the economy, and for some firms their green activity may just be a small part of what they do, it was left up to the business to define their products or services as green or if their workforce had green skills. The term “green” was defined simply as being environment-friendly or beneficial to the environment.

Current and Future Green Business Practices

Businesses were asked to identify what percent of their total products or services were considered green. One percent indicated that all — or 100 percent — of their products or services were green. Fourteen percent said that between 50 and 99 percent of their products or services were green, and one-third indicated that less than 50 percent of their products or services were green. More than half (53 percent) of the businesses noted that they did not produce any green products or did not offer any green services (see Figure 1).

Approximately 11 percent of businesses have an environmental certification or create a product that has an environmental certification. One of the most common certifications Minnesota businesses hold is ISO 14001. Awarded by the International Organization for Standardization, ISO 14001 certifications have requirements for environmental management systems for organizations wishing to operate in an environmentally sustainable manner.

Businesses were asked to identify the types of green practices in which they currently engage (see Table 1). More than one-third of businesses indicated that they currently:

1. Have practices or policies to minimize waste and energy in product distribution (43.2 percent)
2. Implement environmental corporate social responsibility into company policies and decisions (36.9 percent)
3. Support low-impact employee transportation such as mass transit options and telecommuting (33.6 percent)

The least noted green practices of Minnesota businesses include participation in National Environmental Performance Track programs (6.2 percent) and production of a product with a significant green performance attribute (9.3 percent). [2]

In looking forward at the next two years, Minnesota businesses which have not previously engaged in green practices indicated they had plans to:

• Adopt pollution prevention best practices (17.8 percent)
• Implement environmental corporate social responsibility into company policies (16.8 percent)
• Implement clean production processes (15.9 percent).

Current and Future Green Workforce Needs

Businesses involved in green practices may require their employees to have specific green skills or knowledge (see Figure 2). Fifty-four percent of Minnesota businesses indicated that some of their current employees have green skills or knowledge. Only 3 percent of businesses indicated that 50 percent or more of their employees had green skills currently. In the next two years 14 percent of Minnesota businesses expect to have 50 percent or more of their workforce with green skills, and 45 percent of businesses will require some green skills or knowledge from some of their workforce.

When it comes to specific skills, almost half of Minnesota businesses indicated that the value and principles of energy conservation was a knowledge area needed in their current employees. Identification of operational waste (34 percent), knowledge of environmental policies or regulations (32.6 percent), and management skills for implementing or sustaining conservation practices or processes (31.1 percent) were additional green skills and knowledge areas most frequently needed by businesses (see Table 2).

In an effort to identify the future green workforce needs, businesses were asked to indicate the green skills or knowledge areas they foresee their employees needing in the coming years. The results include:

• A general knowledge of the value of principles of energy conservation (11.6 percent)
• Management skills (11.3 percent)
• Identification of operational waste (9.3 percent)

This represents the percent of businesses that do not currently require these green skills of their workforce, but will in the coming years.

Numerous opportunities exist to obtain the skills for green-specific jobs. One-third of Minnesota businesses indicated they have training needs related to specific green knowledge or skills. For those businesses with training needs, the majority (51.4 percent) indicated that they would consider in-house training. More than one-third would consider a private vendor, and 16.5 percent of employers would consider a non-credit seminar or training offered by a higher education institution (see Table 3).

In the next two years Minnesota businesses expect to see an increase in the percent of their employees with green knowledge or skills. Overall, approximately 15 percent of businesses plan on hiring people with any specific green knowledge or skill requirements in the next two years.

The most frequently cited jobs for which Minnesota businesses expect to hire include:

• Installation Technicians
• Maintenance Technicians
• Engineers
• Supervisors or Managers

In addition to green-specific skills, employers listed the overall types of knowledge areas that are most important to their future hiring needs (see Table 4). The most frequently cited knowledge areas were:

• Engineering and technology (47.9 percent)
• Customer service (38.4 percent)
• Production and processing (32.4 percent)
• Administration and management (31.2 percent)
• Lean principles (30.5 percent)
• 
  

Barriers to Implementing Green Practices

Minnesota businesses cited costs of implementation (45.7 percent), shortage of workers currently having green knowledge or skills (19.6 percent), and government policies (12.5 percent) as the main barriers that prevent them from implementing green practices. Only 7 percent of businesses indicated that they were not interested in implementing green practices or production at this time (see Table 5).

Despite obvious long-term benefits, the initial implementation costs for some green practices may be prohibitive. Examples could include purchasing new, energy-efficient machinery or the cost of obtaining environmental certifications. Implementation costs may also vary by industry and size of business.

Conclusion

It is clear that a large number of firms either currently perform or plan to perform green practices. Despite an economic recession, 19.6 percent of Minnesota businesses surveyed cited a shortage of workers currently having green knowledge or skills as a barrier to implementing green practices. In addition, employers plan to increase the number of workers with green skills in the coming two years. Some of this growth will be in businesses that produce a green product or service, but respondents also valued practices that could be applied to many types of industries such as energy conservation and waste reduction. Furthermore, the demand for engineering and technology skills reaffirms that companies want to hire an innovative workforce which may move Minnesota firms into many emerging fields, including but not limited to traditional green industries.

 [1}GSP Consulting Corp., “Green Jobs in Minnesota: Market Analysis,” A Report to the Green Jobs Task Force. www.mngreenjobs.com/sites/default/files/downloads/market analysis.pdf
[2}In March 2009 the U.S. Environmental Protection Agency (EPA) decided to halt the Performance Track program, effective immediately. The National Environmental Performance Track recognizes organizations with strong environmental records beyond what is legally required. Members set four public, measurable goals to improve the environment. There were approximately 500 participating members.
[3]Design for the Environment (DfE) is based on consideration of the entire lifecycle of a product “upfront” during design and optimizing design to improve product function and appeal while maximizing efficient use of water, materials and energy.

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