Eco-innovation and (green) employment: A task-based approach to measuring the composition of work in firms

This paper examines how different types of eco-innovation activities affect firms’ employment patterns. Using a linked employer–employee administrative dataset for the Netherlands we take an individual level task-based approach to differentiate between green and non-green jobs within firms. Our results show that while eco-innovation does not impact overall employment, eco-product innovation does lead to a 19.72% increase in green jobs. The growth in green jobs mainly comes from a compositional shift towards a small yet significant increase in green workers and reduction in non-green workers. Further analysis suggests that firms that voluntarily undertake eco-innovation create more green jobs but also that it is subsidy-driven policies rather than stricter regulations that drives the increase in green employment.