151
4.2 Employment
What was probably the first research report to articulate the idea of a circular economy set out to identify the potential for substituting manpower for energy (Stahel
and Reday 1976). It found that on a macro-economic level, three quarters of energy
is used in mining activities and basic material production, while one quarter is used
in manufacturing goods from basic material; the same estimates are reported by
IPCC (2014). For manpower, the proportions are reversed: three quarters of the
labour input into finished products is in the manufacturing of goods, with only one
quarter in resource exploitation and primary production. Service-life extension
focuses on activities which are kin to manufacturing before automation and are the
most labour intensive. As noted in Sects. 2 and 3, end-of-life goods must be collected using non-destructive and non-diluting collection processes (rather than compactor lorries); the collected goods must be disassembled into components and
materials (instead of being shredded); the components and materials must be
screened to separate parts to preserve value (using skills and experience) so that
components can be repaired or remanufactured and materials can be sorted to be
recycled in the purest form and kept separate to minimise contamination. Each of
these steps is more labour-intensive and resource saving than in the linear makeuse- waste approach.
Macro-economic analyses of the impact of service life extension are scarce,
although a recent study by Skanberg for the Club of Rome (2015) has used input/
output analysis to explore the effect on the Swedish economy of increased resource
efficiency. At the micro-economic level, numerous case studies exist (see text box)
on the manpower intensity of reuse, repair and remanufacturing. All confirm the
conclusion that service-life extension activities substitute manpower for energy and
materials, when compared to manufacturing equivalent new goods. This is exemplified by Fig. 7.5, which shows the results of an analysis of different sectors (ProductLife Institute 2015) with regards to value per weight at the point of sale (€/kg) and
labour input per weight (mh/kg; i.e. the labour components of i M and i R in the terms
of Fig. 7.2) associated with manufacturing or remanufacturing: the key activities of
the performance economy are comparable to life-sciences and nanotechnologies,
and a far distance from manufacturing (Product-Life Institute 2015).
(3) O&M + (1) RETAINED OWNERSHIP
Goods as Services
– transport (e.g. shipping, buses, containers)
– “wet” leasing of aircraft: aircraft plus crew plus fuel
– real estate (e.g. hotels, time-shares)
– short-term equipment rental (e.g. vehicles, tools)
7 Stocks and Flows in the Performance Economy
4.2 Employment
What was probably the first research report to articulate the idea of a circular economy set out to identify the potential for substituting manpower for energy (Stahel
and Reday 1976). It found that on a macro-economic level, three quarters of energy
is used in mining activities and basic material production, while one quarter is used
in manufacturing goods from basic material; the same estimates are reported by
IPCC (2014). For manpower, the proportions are reversed: three quarters of the
labour input into finished products is in the manufacturing of goods, with only one
quarter in resource exploitation and primary production. Service-life extension
focuses on activities which are kin to manufacturing before automation and are the
most labour intensive. As noted in Sects. 2 and 3, end-of-life goods must be collected using non-destructive and non-diluting collection processes (rather than compactor lorries); the collected goods must be disassembled into components and
materials (instead of being shredded); the components and materials must be
screened to separate parts to preserve value (using skills and experience) so that
components can be repaired or remanufactured and materials can be sorted to be
recycled in the purest form and kept separate to minimise contamination. Each of
these steps is more labour-intensive and resource saving than in the linear makeuse- waste approach.
Macro-economic analyses of the impact of service life extension are scarce,
although a recent study by Skanberg for the Club of Rome (2015) has used input/
output analysis to explore the effect on the Swedish economy of increased resource
efficiency. At the micro-economic level, numerous case studies exist (see text box)
on the manpower intensity of reuse, repair and remanufacturing. All confirm the
conclusion that service-life extension activities substitute manpower for energy and
materials, when compared to manufacturing equivalent new goods. This is exemplified by Fig. 7.5, which shows the results of an analysis of different sectors (ProductLife Institute 2015) with regards to value per weight at the point of sale (€/kg) and
labour input per weight (mh/kg; i.e. the labour components of i M and i R in the terms
of Fig. 7.2) associated with manufacturing or remanufacturing: the key activities of
the performance economy are comparable to life-sciences and nanotechnologies,
and a far distance from manufacturing (Product-Life Institute 2015).
(3) O&M + (1) RETAINED OWNERSHIP
Goods as Services
– transport (e.g. shipping, buses, containers)
– “wet” leasing of aircraft: aircraft plus crew plus fuel
– real estate (e.g. hotels, time-shares)
– short-term equipment rental (e.g. vehicles, tools)
7 Stocks and Flows in the Performance Economy