Inclusive workforce – The Next Economy

Five ways to empower regions in clean energy workforce development

The Australian Government can play a key role in helping regional communities prepare for the economic changes brought on by the clean energy transition.

As many clean energy jobs will be concentrated in regional renewable energy zones, building the capacity of regional communities to manage development, attract investment for enabling services and infrastructure, and address workforce challenges is essential.

With effective resources and support, local stakeholders can lead efforts to create training programs, support services, and initiatives that ensure a skilled and diverse workforce while fostering sustainable regional development.

In September, The Next Economy provided a submission for the National Energy Workforce Strategy Public Consultation process. In it, we identified a range of insights on increasing inclusivity in the clean energy workforce (read more here), as well as five examples of actions that already are or have to potential to empower regions in clean energy workforce development:

Coordinate planning and development of clean energy projects, associated infrastructure and other industries within a region. Regional coordination and phased planning can manage workforce demand and support worker mobility. Co-locating new manufacturing and industry precincts within renewable energy zones also have the potential to stabilise clean energy workforce demand and create lasting careers. Developers and industry benefit from these approaches with clear roles, responsibilities, and timelines, along with cost certainty and transparent infrastructure investment programs.

For example: the Victorian Planning Authority (VPA) works with councils, government departments and the community to provide employment, transport, public space and housing planning in the context of an increasing population. The VPA has identified the staged development of housing lots and required infrastructure such as roads and utilities.
Develop place-based training and education initiatives and partnerships: that aggregate skill and expertise demand from across sectors and co-designs and delivers courses with industry in a region.

For example: in the Upper Spencer Gulf, Uni Hub is working with local industries to ensure their needs are connected with training providers and potential students.
Support local businesses to adapt and scale up their operations for greater participation in the sector. In many regional areas where new energy development is proposed, the scale of workers required outstrips the local labour market. In addition, the essential services and infrastructure required to support workforce and population growth are limited or non-existent.

Currently, local content requirements from state governments are aimed to drive regional economic benefits. However, often insufficient existing workforce capacity, the cost to prepare businesses to be ready to tender for clean energy development contracts, and uncertainty around long-term work security all limit the capacity of local businesses to scale their operations and bring on new workers.

For example: TNE’s work with Hay and Carrathool shire councils on climate adaptation and economic transition this year has shown that local businesses are interested in tendering for large renewables projects but lack the capacity and resources to adapt. Uncertainty around work pipelines, contracts, timing, and qualifications prevents businesses from scaling, investing in workforce development, or hiring. Early engagement and ongoing support are crucial for scaling regional workforce development. Accessible, up-to-date local data is needed to improve transparency, workforce planning, and equitable recruitment strategies.
Provide resources for local government and local stakeholders: to carry out the feasibility and business planning activities necessary to develop the case for investment in local services, coordination activities and infrastructure.

For example: in the Cradle Coast Region, developers are working together to address housing shortage as they understand it is a key constraint to renewable energy development. In Gladstone, the economic roadmap process delivered by the local council identified the lack of birthing facilities as a key barrier to retaining workers once they are married and look to start families. Improving access to health services in Gladstone is seen a core strategy to retain the workforce. In NSW, the Murrumbidgee Council has negotiated to improve health services through the community benefit agreement.
Embed additional capacity within local governments: to manage and coordinate regional clean energy related activities. Regional local governments play a key role in coordinating clean energy activities, managing community benefits, and supporting the infrastructure and workforce needs of the energy transition. In Renewable Energy Zones, local governments are dedicating significant resources to these tasks, often diverting attention from regular operations due to limited funding and staff. Many are handling large, complex projects unseen in their region for decades, requiring new expertise to manage the technical, legal, and managerial aspects of energy development.

For example: An NSW Government initiative is providing $250,000 of funding for local governments to carry out planning over the next 3 years is an example of the type of support required; however additional and enduring funding (for the duration of the energy infrastructure development in the region) is necessary to cover the true cost that local governments will bear to manage the energy transformation effectively in their region.

To find out more, read more about our Inclusive Clean Energy Workforce project.

Increasing inclusivity in the clean energy workforce

New research from UTS Institute for Sustainable Futures (ISF) and the Australian Energy Market Operator (AEMO) shows the electricity workforce alone needs to double within five years to meet Australia’s 2030 renewable energy target. More than 80 per cent of these roles will be in renewables, with energy storage jobs soon surpassing domestic coal and gas sectors.

This research highlights the big opportunity to address workforce shortages, especially in regional areas, by fostering inclusive policies that ensure equitable benefits and meaningful employment across all communities. Prioritising inclusion and equity in workforce development is key to a just and fair transition toward a net-zero future for all Australians.

In September, The Next Economy provided a submission for the National Energy Workforce Strategy Consultation Paper. We identified five examples of actions that already are or have to potential to empower regions in clean energy workforce development (read more here) alongside the following key insights:

The benefits of enhancing diverse participation and meaningful employment

Every Australian should benefit from clean energy development, including the opportunity to access and meaningfully participate in the workforce. Research shows Australia’s clean energy workforce, like many other industries, has room to improve in diversity, equity, and inclusion. Factors like competition with other industries and projects, lack of training, the characteristics of clean energy jobs, and insufficient regional consultation contribute to workforce shortages in the sector overall.

Greater attention to diversity, equity and inclusion in workforce development carries broad benefits. Companies who have engaged in inclusive hiring processes have reported benefits such as access to a larger talent pool, higher retention and satisfaction rates, improved workplace culture and greater performance and productivity. In turn, inclusive and equitable workforce development practices facilitate pathways into jobs for people who often face systemic barriers to employment. It also promotes greater workforce diversity, fosters a workers’ sense of belonging and inclusion, enhances health and social outcomes and ensures workers are treated with respect and dignity and more likely to be retained.

An opportunity to power First Nations Jobs

The clean energy transformation is an opportunity to increase workforce participation of First Nations Peoples. The Powering First Nations Jobs in Clean Energy report, by the First Nations Clean Energy Network, is a detailed resource that identifies pathways and options for First Nations Peoples to be supported to enter the clean energy workforce and access quality job opportunities and career pathways as they emerge.

Consistent, long-term Government investment in job readiness and business support programs that are led and codesigned by and for First Nations Peoples is needed. Such investment can support the scaling of efforts underway by the private sector in implementing partnerships and employment pathway programs tailored to First Nations Peoples. For example, in the Department of Defence’s Shoalwater Bay Training Area, Downer Defence worked with a range of partners to deliver training programs and initiatives that support small and medium sized Indigenous businesses to enter and thrive in the defence industry.

Support for migrants, refugees, people with a disability and those recently out of prison

Our research has found that affordability of training, lack of awareness around the need for workforce equity and inclusion, misconceptions about abilities, procurement requirements, development speed, and the culture of clean energy workplaces, all impede on the diverse participation in the clean energy workforce.

Strategies tailored to people and their unique context can drive greater participation in the clean energy workforce for different groups. These include building awareness, inspiration and attraction to clean energy careers across diverse populations, improving access to affordable higher education, ensuring ‘wrap around support’ is available for people transitioning into work, cross sectoral collaborations and partnerships, and fostering a workforce culture that is inclusive and values the abilities and contributions of all.

The rapidly growing clean energy sector is well poised to develop a diverse, equitable and inclusive workforce at the scale and pace required to achieve national targets. Other related sectors have experienced the benefits of a diverse and inclusive workforce over the years and developed significant body of knowledge on how to support workforce development in an inclusive and equitable way. The clean energy sector has the advantage of drawing on this existing knowledge and ensure that opportunities in the clean energy workforce benefits all Australians.

Can we improve inclusiveness in the clean energy workforce?

Have you ever wondered how inclusive the clean energy workforce is – or could be?

Australia is now firmly in the implementation phase of the energy transition, with more and more employment opportunities in the clean energy workforce. In fact, nearly half a million workers are projected to be needed to reach Australia’s 2030 renewable energy target alone.

The Next Economy is working with a range of stakeholders to explore how to expand the renewable energy workforce to include people who often face systemic barriers to employment. Specifically, in regions with growing demands for workers in clean energy.

The Inclusive Clean Energy Workforce (ICEW) project aims to ignite discussion about how we can work together to enhance diversity, equity and inclusion.

Our current discussion paper captures pivotal themes and insights drawn from a desktop review of literature and interviews with stakeholders across the clean energy sector, social services and employment sectors.

In mid-July 2024, we’re hosting a range of workshops to get feedback on this initial piece of work and to dive deeper into opportunities and practical strategies to enhance diversity, equity and inclusion in the clean energy workforce.

Opportunities and insights will be captured and shared in a series of sector resources and webinars in the second half of 2024.

Early findings and key points:

Every Australian deserves access to the benefits of clean energy development, including new and existing jobs required for the workforce

The current clean energy sector can improve on diversity, equity and inclusion despite already outperforming other energy sectors including coal and gas

Greater diversity, equity and inclusion not only improves outcomes for individuals, but also can for companies, communities, the sector and the economy

From access to training and education to workplace culture characteristics, there are several systemic, cultural and broader factors and barriers marginalised groups face accessing jobs in the clean energy workforce

Working together, stakeholders from industry, education and training, and civil society can enhance diversity, equity and inclusion in the clean energy workforce

If you’re interested in finding out more, or want to share your insights with us, please contact Jacqui Bell.

What’s a Wellbeing Economy?

We ask Dr Katherine Trebeck, Economic Change Lead at The Next Economy

In a nutshell, what is a wellbeing economy?

An economy designed deliberately to work for people and the planet, not the other way around as so often seems to be the case today. It’s about creating a context in which people thrive, first time around, rather than having to deploy loads of resources trying to fix and repair after damage has been done. This means initiatives that speak to the purpose of the economy, prevention, predistribtion (not just redistribution), and a people powered economy.

So, it requires thinking about what activities we need more of because they help create that context and finding ways to expand those activities: being selective about what is growing, rather than pursuit of any sort of growth.

Are there any examples of using this framework successfully? If so, how?

Think about the wellbeing economy not so much as a framework, but more as a paradigm. It requires a substantial shift in how the economy is thought about and approached. It is about seeing the economy as a mechanism to meet our real goals, and certainly not something to which all other goals are subservient. Not only are we seeing a growing conversation and emerging such as the Wellbeing Economy Alliance initiatives where people are coming together to promote the agenda or its component parts, but there are loads of examples of governments and enterprises making the sort of changes that are necessary. For example:

Multidimensional measurement dashboards (Australia’s Measuring What Matters statement is an example of this) and support for social enterprises (the recently announced Social Enterprise Development Initiative, for example)
Circular economy production and public transport systems
Community or worker owned businesses such as the Earth Worker Cooperative in Victoria
Considering the environmental cost of the things we buy.

The challenge is that while there is no shortage of examples, often they are the exception that proves the rule. One nice illustration of the potential for this is seen in the Community Wealth Building work happening in places like Cleveland in the US and in Preston in the UK (plus in various parts of Australia too). In Preston, there has been research which shows the council’s efforts to procure locally, to support local businesses and local employment has meant the local economy has been more resilient, but also people’s mental health and reported personal wellbeing has improved.

How might the principles of a wellbeing economy help address current challenges posed by high cost of living pressures?

A key feature of a wellbeing economy approach is to look at the root causes of an issue, and not just respond crisis to crisis, symptom to symptom.

So in terms of cost-of-living pressures and high housing costs as a key part of that, a wellbeing economy approach would entail examining the way the housing market operates – who owns the houses? What taxes and incentives encourage the sort of ownership patterns that are forcing up prices? Why aren’t there more community housing cooperatives and other modes of providing housing in Australia?

It would then step back and reflect on what the ultimate goal is – shelter for people in Australia’s towns and cities. It would then think about what needs to change in the economy for more people to have access to good quality shelter – perhaps that means shifting taxes to discourage people owning more and more homes as investment devices? Perhaps that means changing planning laws to enable more community groups to co-own housing? Perhaps that means ensuring homes are built with high energy efficiency standards so once people move into them, they aren’t spending huge amounts on heating and cooling them.

And speaking of energy efficiency, a wellbeing economy approach is also about being ambitious for flow-on benefits – so if housing is being built, can it help address environmental challenges by needing less carbon and using more recycled materials? Can it help address equity and inclusion by being built by companies employing local people, which have gender balance in their teams, and which pay living wages etc? And can it help roll out models of enterprise that have a social purpose at their heart, so could the houses be owned by a housing cooperative?

How might Australia adopt a wellbeing economy framework? What are the steps that need to happen?

There’s a precondition for government acting – that’s people talking about it, and being able to imagine an economy that serves them, not the other way around: an economy that doesn’t generate so much inequality and put so much pressure on the planet. That will be helped by learning about examples of this in practice, even in small scale. Then policy makers need to step in to design the rules of the game so those good examples are common place.

What would a state or federal budget for a wellbeing economy look like?

It would use things like taxes and subsidies to support the sort of activities which are good for people and planet, and to discourage those that aren’t. In other words, it would ask what we need more of and how can mechanisms in the budget help cultivate them?

With the support of the Lord Mayor’s Charitable Foundation, The Next Economy is convening an ‘Upstream Lab’ to explore the economic root causes of many of today’s challenges, including how to take action where there is scope to prevent harm happening in the first place. More details to come as we roll out this exciting initiative.

Find out more:

On the wellbeing economy, is Australia at risk of dropping the ball? Opinion piece by Dr Katherine Trebeck in Croakey Health Media, 14 May 2024

The Wellbeing Economy in Brief, Dr Katherine Trebeck and Warwick Smith, Centre for Policy Development, February 2024