Economic Growth Potential of More Circular Economies

9th September 2015

The report shows how a growing circular economy can deliver economic benefits such as job creation, lower unemployment and increased productivity through material productivity.

Key points
A circular economy creates economic value through using more labour and fewer resources
3.4 million people are currently employed in circular economy activities in Europe
By 2030, expansion in circular economy has the potential to create 1.2 to 3 million jobs in Europe and reduce unemployment by around 250,000 to 520,000

Europe faces substantial economic and environmental challenges in its use of labour and scarce natural resources. In 2014, unemployment had risen in every single European country apart from Germany compared to 2008 when the financial crisis began.  There are signs that employment is recovering and unemployment is starting to show signs of stabilisation (or is falling in some countries across Europe).  But unemployment remains sharply higher in many countries, particularly for certain occupational types and age groups.

A circular economy create economic value with more labour and fewer resources, therefore growth in circular economy can potentially deliver economic benefits such as employment creation, lower structural unemployment and increased materials productivity.   This report discusses several indicators to support development in circular economy and constructs examples from available information for Europe and the the UK.  It presents an indicative quantification of scenarios to 2030 illustrating the job creation potential from an expansion in circular economy in Europe.

Current employment in Europe in circular economy activities (in the repair, waste and recycling, rental & leasing sectors) is estimated to be at least 3.4 million. Of this total 1.2 million jobs are in repair of machinery & equipment, 400,000 jobs are in repair of computers, personal and other household goods, 700,000 jobs are in waste collection, treatment & disposal activities, 300,000 are employed in the recovery of sorted materials and the wholesale of waste and scrap, 100,000 jobs are in in-store retail of second hand goods and 600,000 people are employed in rental & leasing activities. The report provides details for each European Member state.

Assuming a continuation of the pace of current development in circular economy in Europe there’s a potential to create 1.2 million jobs by 2030 with a reduction in unemployment by around 250,000.  A more extensive development of circular economy in Europe by 2030 could create 3 million jobs and a reduce unemployment by 520,000. The report provides details for each European Member state.