How a post-pandemic stimulus can both create jobs and help the climate
The $10 trillion in stimulus measures that policy makers have allocated could be decisive for the world’s low-carbon transition. Here’s how organizations can bring economic and environmental priorities together.
The COVID-19 crisis has understandably taken much attention away from the threat of climate change, as institutions devoted themselves to protecting lives and livelihoods. Sustaining an effective public-health response remains a top concern for many policy makers and business executives. Severe job losses and revenue declines in some sectors, along with the high likelihood of an economic recession, have also compelled policy makers to mount an unprecedented financial response, which already exceeds $10 trillion, according to McKinsey estimates.
Important as it is to repair the economic damage, a swift return to business as usual could be environmentally harmful, as the world saw after the 2007–08 financial crisis. The ensuing economic slowdown sharply reduced global greenhouse-gas emissions in 2009. But by 2010, emissions had reached a record high, in part because governments implemented measures to stimulate economies, with limited regard for the environmental consequences.
The danger now is that the same pattern will repeat itself—and today the stakes are even higher. The period after the COVID-19 crisis could determine whether the world meets or misses the emissions goals of the 2015 Paris Agreement, which were set to limit global warming to 1.5°C to 2°C. This article considers how a post-pandemic stimulus can both create jobs and help the climate.