Growth and innovation in the UK’s net zero economy

As the urgency to address climate change intensifies, the UK stands at the forefront of a significant economic transformation. The nation's net zero economy is not only a testament to its commitment to sustainability but also a burgeoning sector that promises substantial economic benefits. The latest CBI Economics report, commissioned by the Energy & Climate Intelligence Unit (ECIU) highlights just how much the UK's net zero economy is already contributing.

A green growth engine

Think going green is just a nice idea? Think again. The net zero economy has become a powerhouse of job creation and economic expansion with 10.1% growth in the total economic value supported by the net zero economy since 2023. In 2024, there were 22,800 net zero businesses, with small and medium-sized enterprises (SMEs) making up 94% of the sector. Together, these businesses have pumped £28.8 billion into the economy - 0.82 billion less than the entire size of Wales's economy. They also support 273,000 full-time jobs, outpacing employment in the telecommunications industry.

And that's just the tip of the iceberg. When you factor in supply chain activities, the sector's economic impact skyrockets to £83.1 billion, supporting nearly 951,000 jobs across the UK - that's 2.9% of total UK employment. Even better, net zero jobs are 40% more productive than the national average, with wages 15% higher than the UK norm. In other words, these aren't just more jobs - they're better jobs.

A nationwide revolution

Unlike some industries that cluster in major cities, the net zero economy is making waves across the entire UK. While London and the South East remain economic heavyweights, the real green revolution is happening in regions beyond the capital. The West Midlands, Yorkshire & the Humber, and South West England are emerging as hotspots, contributing 16.3% of the nation's net zero economy.

Scotland, Wales, and Northern Ireland are also reaping the rewards. In Scotland alone, the net zero economy contributes £9.1 billion (about 4.9% of the country's total GVA) and supports 100,700 full-time jobs - nearly 1 in 25 Scottish workers employed in a net zero-related role. This widespread distribution of green jobs and investment underscores the sector's role in levelling up the UK economy.

Investment is fuelling the future

Investors are taking notice - big time. A record £6.4 billion flowed in during 2023 alone. In 2023/24, net zero businesses attracted £23 billion in funding, with £20.1 billion coming from foreign direct investment (FDI), a growth of 47% compared to 2022/23. London led the way, securing 32 FDI projects and creating 2,533 new jobs in the sector. Interestingly, 93% of net zero investments were concentrated within a single region, showing just how targeted and high-impact these investments can be.

The takeaway: A net zero economy with serious momentum

The UK's net zero economy isn't just about hitting climate targets - it's a dynamic and fast-growing sector that's creating jobs, boosting productivity, and attracting billions in investment. With sustainability at its core, this green revolution is proving that economic success and environmental responsibility go hand in hand.

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