Effects of the Circular Economy on Jobs

This literature review seeks to enunciate the different understandings of the term “circular economy” and the baselines that have been used for projections on job impacts and growth. It introduces some of the targets for European countries that are championing the transformation from a linear to a circular economy. The report also outlines the current literature’s understanding of job sectors that might change in the future.

With growth in GDP and real wages around the world, inequality, greenhouse gas (GHG) emissions, and material extractions have increased at an even higher rate. The resource- and carbon-intensive model of “take, make, waste” is no longer acceptable.

The economic growth in many countries in Africa, Asia and the Pacific, and the Americas remains tied to GHG emissions, material extraction, water, and land use. Pioneers have been forging a different path in understanding the economy. Some countries have started to decouple economic growth from GHG emissions by increasing the use of renewable energy, carbon pricing, green product subsidies, and policies to promote green jobs. European organizations, corporations, and governments have written reports and done preliminary pilots to advance an understanding of job impacts in the circular economy in which prosperity and growth are decoupled from material use and GHG emissions.

Though early reports and legislation on the circular economy date back over a decade, there is still little cohesion on concrete definitions of what a circular economy looks like in practice, including what kinds of jobs fit the description and which ones are affected by a transition toward a circular economy. This means that analyses of job impacts, and trade-related effects still differ widely across current publications and approaches.