Vermont Environmental Monitor

January 2006
How Should Vermont Measure Environmental Economic Activity?
by
Daniel Hecht

How many green companies are there in Vermont? How much do they contribute to the state’s GDP? How many jobs? How are they doing?

There are several reasons why it’s hard to quantify the environmental sector’s economic value, and they’re worth considering because they point out important aspects of a changing industry. The most significant is the difficulty of defining what is “environmental.”

The sector and its activity segments are defined variously, but Environmental Business International’s index is among the most commonly cited. It tracks activity in 14 general categories under the subheads of services, equipment, and resources. These familiar pillars of the sector include analytical services, solid waste management, instruments and information systems, renewable energy technology, etc.

In Vermont in 2002, for example, these 14 segments accounted for $500 million of the state’s GDP and 3,513 jobs. But while the numbers provide useful referents, they mask a systemic flaw. Environmental activity is actually far more diverse; arguably, it’s not really a distinct sector but a strand that runs through every economic activity area.

To boost environmental enterprise, we need to leverage all available resources and develop synergy among diverse elements; to cope with the complex environmental challenges we face, we need whole-system, integrated solutions. For VEC, this has required a broader definition of “environmental” activity, with categories that resemble those used by the Canadian Council for Human Resources’ Environmental Labour Market Report. All of the following contribute substantially to Vermont’s economy and are crucial to developing a culture of sustainability:

  • Environment-related education
  • Environmental law
  • Environment-related communications and public awareness activities such as advertising, public relations, graphics design, journalism, etc.
  • Community development consulting/planning for sustainability
  • Fish and wildlife management
  • Green building design, construction, consulting, assessment, certification
  • Green consumer products
  • Nonprofit organizations devoted to environmental research, conservation, public health, sustainable development, etc.
  • Primary scientific research on natural systems
  • Public agencies charged with environmental and natural resource policy making, conservation, regulation, compliance, etc.
  • Sustainable agriculture and forestry technologies, services, goods, practices, and programs
  • Sustainability, compliance, and efficiency departments within larger corporations

The traditional segments are certainly well-represented in Vermont, from the reliable workhorse of solid waste management, to the current rock-stars of the industry, information systems and renewable energy.

But environmental education is growing fast, bringing in tuition dollars, paying instructor salaries, building intellectual capacity, and providing future professionals for the sector. Nonprofit organizations – of which Vermont, famously, has more per capita than any other state – bring in federal and philanthropic funds, pay staff salaries, and stimulate innumerable green initiatives. Public agencies employ large staffs devoted to conservation, regulation, monitoring, etc. And agriculture is increasingly making use of technologies for renewable energy, pollution remediation, soil and water mapping and testing, and moving toward market opportunities in “environmental” products and practices like organic farming.

To really measure the economic impact of environmental enterprise in Vermont, we need to assemble data on this whole web of related activities. The result could have a significant effect on the state’s economic policy, bolstering support for the vision of an economy based on a robust green enterprise sector.

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