The Social Benefits of a Circular Economy
Content
The social benefits of a circular
economy: lessons from the UK
Why is a circular economy good for people?
It isn’t just business and the environment that benefit from the
circular economy.
Good policy, that makes products easier to repair and longer lasting
with incentives to take old products back, can cut unemployment
and save people money.
The circular economy can reduce unemployment where it is high…
Expanding the circular economy could create 205,000 new jobs in the UK alone. Because it can
address labour market skill gaps and regional unemployment, 54,000 of these jobs could be net jobs
by 2030, bringing people back into employment.1 Other EU countries could reap similar benefits.
Unemployment rate in UK regions,
June-August 2014
Net job creation in circular economy activity to
2030 at current growth rate, as a percentage of
labour force
Scotland
5.5%
Scotland
0.07%
North East
9.3%
North West
6.7%
Wales
6.5%
West Midlands
7.5%
South West
4.6%
Yorkshire
& the Humber
7%
North West
0.24%
(8,474 jobs)
East Midlands
5.5%
Wales
0.23%
East England
4.9%
West Midlands
0.39%
(10,659 jobs)
London
6.6%
South East
4.7%
North East
0.54%
(6,948 jobs)
Yorkshire
& the Humber
0.30%
(7,978 jobs)
East Midlands
0.08%
East England
0.01%
London
0.12%
… and provide work at all skill levels in the labour market
Circular economy job creation potential by
skill type1
UK unemployment rate by skill type 20142
Activity
Higher value,
closed loop recycling
10%
Lower value,
open loop recycling
8%
7.9%
Servitisation
(services instead
of products)
6%
Remanufacturing
4%
3.6%
Reuse
2%
Biorefining
0
Low skilled
Skilled
Professional
2.2%
Low skilled
Skilled
Professional
The circular economy is lucrative
By recovering value from items that would otherwise go to waste, the circular economy improves
resource productivity and competitiveness. The most value comes from keeping things in working order.
In the UK, electronic and electrical goods are worth 50 per cent more if they are sold for reuse rather
than recycling. However, only 23 percent are suitable for reuse and only two per cent are currently
reused.3
Reuse and parts harvesting are much more valuable than recycling4
New phone
Product price £599
New phone
Second-hand phone Second-hand phone
Product price £599
Price if reused £290
Price if reused £290
Parts £170
Parts £170
Parts £188
Parts £188
Materials £1.50
Materials £1.50
Materials
£0.72
Finished products
are
worth much more than
the raw materials inside
them
Materials £0.72
Parts in a broken phone
are worth nearlyone
third of the original
value of the device
Finished products are worth
much
more are worth
Finished
products
much
Parts
in amore
broken phone
Parts
are worth
in a broken
nearlyphone are worth nearly
than the raw materialsthan
inside
them
the
raw materials inside
onethem
third of the originalone
value
third
of of
the
the
device
original value of the device
Good design enables easy repair
Apparently similar devices have very different levels of repairability5
LG G4 2015
HTC One 2013
8/10
1/10
ifixit repairability
rating
ifixit repairability
rating
Time to repair
10 minutes
Time to repair
90 minutes
Low risk of damage
during repair
High risk of damage
during repair
+ Rear panel battery can be removed with no tools
+ Many components are modular and can be replaced independently
-- LCD is fused to the glass
+ Solid external construction improves durability
-- Virtually impossible to open without extreme damage to rear case
-- Battery is buried under motherboard and adhered to midframe
The sale of products for reuse and remanufacture supports
more jobs6
Reuse and remanufacture
High value is retained by
keeping the original design
and function of products
8-20 jobs
(per thousand
tonnes of products)
Recycle
Moderate value is retained
by recapturing raw materials
to make new products
5-10 jobs
(per thousand
tonnes of material)
Landfilling is a waste of valuable products
and materials...
Landfill
Value is lost when materials
and products are thrown
away, costing consumers
over £100 per tonne
0.1 jobs
(per thousand
tonnes of waste)
Consumers want more repairable products
The proportion of laptops replaced in
Germany because they were broken shot up
from seven per cent in 2007 to 27 per cent in
2013, whereas the number of Germans who
replaced their laptop simply for a better model
fell from 56 per cent to 25 per cent over the
same period.7
Qualitative research for the UK’s Department
for Environment Food and Rural Affairs shows
that consumers are “annoyed” when devices
don’t last as long as expected, and they found
that getting devices repaired was “too
difficult.”8
How the EU can help
Good policy can ensure better quality products that stay in use for longer
New secondary
materials markets
Producer
responsibility policy
prioritising reuse
and supporting
secondary materials
markets
Ecodesign
policy
more reusable
more recyclable
The EU’s circular economy policy package has the potential to improve the design of products and
ensure that producers reuse and recycle more.
Keeping valuable resources circulating in the economy supports the market for secondary products
and materials across all regions, which could create new jobs in areas of high unemployment. It also
satisfies consumer demand for better, longer lasting products.
An efficient circular economy will increase resource productivity and resilience, and it will help
Europe to stay competitive in a world of rising demand for materials.
Sources
1. Green Alliance/WRAP, 2015,
Employment and the circular economy:
job creation in a more resource efficient
Britain
2. Calculation based on data in: Green
Alliance/WRAP, 2015, Employment and
the circular economy: job creation in a
more resource efficient Britain
3. Analysis by WRAP of the reuse
potential of WEEE taken to Household
Waste Recycling Centres, www.wrap.
org.uk/sites/files/wrap/WRAP%20
WEEE%20HWRC%20summary%20
report.pdf
4. Green Alliance, 2015, A circular
economy for smart devices
5. Ifixit: www.ifixit.com/smartphonerepairability; and, www.ifixit.com/
Guide/HTC+One+Display+Assembly+R
eplacement/19277
6. Adapted from: Green Alliance, 2014,
More jobs, less carbon: why we need
landfill bans
7. Oeko-Institut, 2015, Influence of the
service life of products in terms of their
environmental impact: establishing an
information base and developing
strategies against “obsolescence”
8. Brook Lyndhurst, 2011, Public
understanding of product lifetimes and
durability (1) - A research report
completed for the Department for
Environment, Food and Rural Affairs
Green Alliance
Green Alliance is a charity and
independent think tank focused
on ambitious leadership for the
environment. We have a track
record of over 35 years, working
with the most influential leaders
from the NGO, business, and
political communities. Our work
generates new thinking and
dialogue, and has increased
political action and support for
environmental solutions in the UK.
Green Alliance
36 Buckingham Palace Road,
London, SW1W 0RE
020 7233 7433
[email protected]
www.green-alliance.org.uk
blog: greenallianceblog.org.uk
twitter: @GreenAllianceUK
The Green Alliance Trust is a
registered charity 1045395 and
company limited by guarantee
(England and Wales) 3037633,
registered at the above address
Published by Green Alliance,
August 2015
Designed by Howdy
© Green Alliance, 2015
Green Alliance’s work is licensed under a
Creative Commons AttributionNoncommercial-No derivative works 3.0
unported licence. This does not replace
copyright but gives certain rights without
having to ask Green Alliance for permission.
Under this licence, our work may be shared
freely. This provides the freedom to copy,
distribute and transmit this work on to
others, provided Green Alliance is credited
as the author and text is unaltered. This
work must not be resold or used for
commercial purposes. These conditions can
be waived under certain circumstances with
the written permission of Green Alliance. For
more information about this licence go to
http://creativecommons.org/licenses/
by-nc-nd/3.0/
economy: lessons from the UK
Why is a circular economy good for people?
It isn’t just business and the environment that benefit from the
circular economy.
Good policy, that makes products easier to repair and longer lasting
with incentives to take old products back, can cut unemployment
and save people money.
The circular economy can reduce unemployment where it is high…
Expanding the circular economy could create 205,000 new jobs in the UK alone. Because it can
address labour market skill gaps and regional unemployment, 54,000 of these jobs could be net jobs
by 2030, bringing people back into employment.1 Other EU countries could reap similar benefits.
Unemployment rate in UK regions,
June-August 2014
Net job creation in circular economy activity to
2030 at current growth rate, as a percentage of
labour force
Scotland
5.5%
Scotland
0.07%
North East
9.3%
North West
6.7%
Wales
6.5%
West Midlands
7.5%
South West
4.6%
Yorkshire
& the Humber
7%
North West
0.24%
(8,474 jobs)
East Midlands
5.5%
Wales
0.23%
East England
4.9%
West Midlands
0.39%
(10,659 jobs)
London
6.6%
South East
4.7%
North East
0.54%
(6,948 jobs)
Yorkshire
& the Humber
0.30%
(7,978 jobs)
East Midlands
0.08%
East England
0.01%
London
0.12%
… and provide work at all skill levels in the labour market
Circular economy job creation potential by
skill type1
UK unemployment rate by skill type 20142
Activity
Higher value,
closed loop recycling
10%
Lower value,
open loop recycling
8%
7.9%
Servitisation
(services instead
of products)
6%
Remanufacturing
4%
3.6%
Reuse
2%
Biorefining
0
Low skilled
Skilled
Professional
2.2%
Low skilled
Skilled
Professional
The circular economy is lucrative
By recovering value from items that would otherwise go to waste, the circular economy improves
resource productivity and competitiveness. The most value comes from keeping things in working order.
In the UK, electronic and electrical goods are worth 50 per cent more if they are sold for reuse rather
than recycling. However, only 23 percent are suitable for reuse and only two per cent are currently
reused.3
Reuse and parts harvesting are much more valuable than recycling4
New phone
Product price £599
New phone
Second-hand phone Second-hand phone
Product price £599
Price if reused £290
Price if reused £290
Parts £170
Parts £170
Parts £188
Parts £188
Materials £1.50
Materials £1.50
Materials
£0.72
Finished products
are
worth much more than
the raw materials inside
them
Materials £0.72
Parts in a broken phone
are worth nearlyone
third of the original
value of the device
Finished products are worth
much
more are worth
Finished
products
much
Parts
in amore
broken phone
Parts
are worth
in a broken
nearlyphone are worth nearly
than the raw materialsthan
inside
them
the
raw materials inside
onethem
third of the originalone
value
third
of of
the
the
device
original value of the device
Good design enables easy repair
Apparently similar devices have very different levels of repairability5
LG G4 2015
HTC One 2013
8/10
1/10
ifixit repairability
rating
ifixit repairability
rating
Time to repair
10 minutes
Time to repair
90 minutes
Low risk of damage
during repair
High risk of damage
during repair
+ Rear panel battery can be removed with no tools
+ Many components are modular and can be replaced independently
-- LCD is fused to the glass
+ Solid external construction improves durability
-- Virtually impossible to open without extreme damage to rear case
-- Battery is buried under motherboard and adhered to midframe
The sale of products for reuse and remanufacture supports
more jobs6
Reuse and remanufacture
High value is retained by
keeping the original design
and function of products
8-20 jobs
(per thousand
tonnes of products)
Recycle
Moderate value is retained
by recapturing raw materials
to make new products
5-10 jobs
(per thousand
tonnes of material)
Landfilling is a waste of valuable products
and materials...
Landfill
Value is lost when materials
and products are thrown
away, costing consumers
over £100 per tonne
0.1 jobs
(per thousand
tonnes of waste)
Consumers want more repairable products
The proportion of laptops replaced in
Germany because they were broken shot up
from seven per cent in 2007 to 27 per cent in
2013, whereas the number of Germans who
replaced their laptop simply for a better model
fell from 56 per cent to 25 per cent over the
same period.7
Qualitative research for the UK’s Department
for Environment Food and Rural Affairs shows
that consumers are “annoyed” when devices
don’t last as long as expected, and they found
that getting devices repaired was “too
difficult.”8
How the EU can help
Good policy can ensure better quality products that stay in use for longer
New secondary
materials markets
Producer
responsibility policy
prioritising reuse
and supporting
secondary materials
markets
Ecodesign
policy
more reusable
more recyclable
The EU’s circular economy policy package has the potential to improve the design of products and
ensure that producers reuse and recycle more.
Keeping valuable resources circulating in the economy supports the market for secondary products
and materials across all regions, which could create new jobs in areas of high unemployment. It also
satisfies consumer demand for better, longer lasting products.
An efficient circular economy will increase resource productivity and resilience, and it will help
Europe to stay competitive in a world of rising demand for materials.
Sources
1. Green Alliance/WRAP, 2015,
Employment and the circular economy:
job creation in a more resource efficient
Britain
2. Calculation based on data in: Green
Alliance/WRAP, 2015, Employment and
the circular economy: job creation in a
more resource efficient Britain
3. Analysis by WRAP of the reuse
potential of WEEE taken to Household
Waste Recycling Centres, www.wrap.
org.uk/sites/files/wrap/WRAP%20
WEEE%20HWRC%20summary%20
report.pdf
4. Green Alliance, 2015, A circular
economy for smart devices
5. Ifixit: www.ifixit.com/smartphonerepairability; and, www.ifixit.com/
Guide/HTC+One+Display+Assembly+R
eplacement/19277
6. Adapted from: Green Alliance, 2014,
More jobs, less carbon: why we need
landfill bans
7. Oeko-Institut, 2015, Influence of the
service life of products in terms of their
environmental impact: establishing an
information base and developing
strategies against “obsolescence”
8. Brook Lyndhurst, 2011, Public
understanding of product lifetimes and
durability (1) - A research report
completed for the Department for
Environment, Food and Rural Affairs
Green Alliance
Green Alliance is a charity and
independent think tank focused
on ambitious leadership for the
environment. We have a track
record of over 35 years, working
with the most influential leaders
from the NGO, business, and
political communities. Our work
generates new thinking and
dialogue, and has increased
political action and support for
environmental solutions in the UK.
Green Alliance
36 Buckingham Palace Road,
London, SW1W 0RE
020 7233 7433
[email protected]
www.green-alliance.org.uk
blog: greenallianceblog.org.uk
twitter: @GreenAllianceUK
The Green Alliance Trust is a
registered charity 1045395 and
company limited by guarantee
(England and Wales) 3037633,
registered at the above address
Published by Green Alliance,
August 2015
Designed by Howdy
© Green Alliance, 2015
Green Alliance’s work is licensed under a
Creative Commons AttributionNoncommercial-No derivative works 3.0
unported licence. This does not replace
copyright but gives certain rights without
having to ask Green Alliance for permission.
Under this licence, our work may be shared
freely. This provides the freedom to copy,
distribute and transmit this work on to
others, provided Green Alliance is credited
as the author and text is unaltered. This
work must not be resold or used for
commercial purposes. These conditions can
be waived under certain circumstances with
the written permission of Green Alliance. For
more information about this licence go to
http://creativecommons.org/licenses/
by-nc-nd/3.0/
