Jobs and the Environment: Being Careful With Numbers

September 05, 2011

The NYT had an article discussing jobs and the environment today. It told readers about research by Michael Greenstone, an economics professor at M.I.T, that found that the Clean Air Act and amendments from 1972-1987 led to a loss of 600,000-700,000 in the industries directly.

It is important to note that this is not a measure of the job loss to the economy as a whole. Money that was not spent in these industries was mostly spent elsewhere. This means that the job loss to the economy as a whole from these regulations would have been a small fraction of this number.

In fact, since these regulations have been shown to have large health benefits, it is very possible that they increased jobs for the economy as a whole. If people are on average more healthy, then health insurance will cost less. This will increase real wages and lead to more jobs.

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