What Does an Environmental Economist Do? (How to Become One)

By Indeed Editorial Team

Published September 27, 2022

The Indeed Editorial Team comprises a diverse and talented team of writers, researchers and subject matter experts equipped with Indeed's data and insights to deliver useful tips to help guide your career journey.

Environmental economists help public and private organizations research the financial measures they can implement to mitigate or reduce the impact their operations might have on the environment. Since a company's operations, warehouses, buildings, and industrial waste can affect the environment, it might hire an environmental economist to evaluate this impact from a financial perspective. Learning about these professionals, their typical work environment, and their responsibilities can help you better assess this career path and decide whether it's a good fit for you.

In this article, we discuss what an environmental economist does, list the essential skills you can develop for this role, and explain how you can become one.

What does an environmental economist do?

If you're passionate about the environment and interested in the economy, you may wonder, "What does an environmental economist do?" These professionals can help organizations research, assess, and forecast the economics of environmental initiatives, such as green buildings, sustainable transportation, and renewable energy.

They can also assist them in evaluating the environmental impacts of their products and services. For instance, they can determine how much a company might save in energy costs by using recycled materials to create its products. Here are a few more of their responsibilities and duties:

Assessing the economics of environmental issues

When the company identifies an environmental problem, such as large-scale energy consumption or the transportation of hazardous waste, environmental economists help it assess the potential costs of addressing that issue. For instance, if an oil company determines that an oil spill might cause environmental damage, an environmental economist can help the company estimate the cost of cleaning it up and compensate the people affected. Here, the economist might consider penalties issued by provincial and federal governments, lost product costs, and the expenses of hiring cleanup crews and equipment.

To perform these calculations, it's vital for these professionals to understand the nature of the industry, which means being experts in the different measures a company can use to solve an environmental issue.

Related: 13 Sustainability and Climate Change Jobs (With Salaries)

Evaluating the costs of environmental regulations

These economists can also assess the costs of environmental regulations, which means they can consider the expenses companies might incur to comply with environmental policies. Usually, these professionals receive these outlined regulations from the federal and provincial governments before they enter the business. This allows them to estimate compliance costs and communicate to the governments the economic effects of these regulations, as they can lead to job loss and a decrease in company profits.

Because of their analytical skills, environmental economists can help governments and environmental non-profit organizations to create viable policies. For instance, they can help create a carbon tax to encourage the production of electric vehicles and the development of renewable energy sources.

Related: 18 Environmental Science Jobs to Explore (With Salaries)

Considering a company's core operations

One of the essential responsibilities of an environmental economist is to estimate the cost of the environmental externalities associated with a company's core operations. This is because the cost of a potential change in a company's core operations can be significant and affect the company's viability.

For instance, suppose a construction company plans to build new roads within an environmentally protected area. Here, the economist might estimate that the cost may require more employees while also needing to purchase or rent environmentally friendly equipment. They may also consider whether the span of the construction project might affect other projects within the company, reducing or increasing its profits in the long term. This information can help company executives decide whether to proceed with the project.

Researching the economics of previous environmental initiatives

To assess and forecast the impact of environmental initiatives, these professionals usually analyze previous events to learn from their successes and failures. They can collect economic data from previous environmental issues and projects and compare it to the current situation or initiatives.

For instance, suppose the federal government wants to assess the impact of a country-wide solar energy initiative. Environmental economists working for the government can consider the cost of similar projects in the past or other countries and compare them to the local initiative. They can use this data to determine how much money the federal government can save within a set period. They can also assess how this initiative might affect the economy in the future and how many jobs it might help create.

Related: Types of Economists (With Common Duties and Career FAQs)

Essential skills for environmental economists

Below are some skills that can help you advance your career as an environmental economist:

Math

Math skills are the ability to solve mathematical problems, perform calculations, and understand mathematical concepts. Environmental economists use these skills to use math formulas, create graphs and charts, and generate spreadsheets. By doing this, they can visually represent and explain their calculations to interested parties and the public.

Read more: Math Skills: Definitions, Examples, and How to Improve Them

Research

Research skills refer to the ability to collect relevant data and find sources of information related to a particular topic. Environmental economists use these skills to revise and study previous environmental issues, policies, legislation, and company practices. This information can help them support their arguments, make them more convincing, and contrast their ideas with previous cases.

Read more: Research Skills: Definition and Examples

Data analysis

After collecting the data, these professionals usually apply their analytical skills to interpret it and draw conclusions. Analyzing the data means considering how a particular environmental issue or project can affect the company's vision and business objectives. It also involves assessing costs, benefits, and risks associated with these situations, and making recommendations about how to proceed financially.

Related: 12 Data Analysis Software Programs You Can Use at Work

Advising and consulting

Consulting refers to the ability to provide expert advice to a client or employers on a wide range of environmental issues. You can advise them on how to protect their primary source of income while addressing an environmental issue or how to save money while complying with environmental regulations. Environmental economists often work with company executives and upper management representatives to help them understand their companies' environmental and economic impacts.

Related: How to Get into Consulting (With 6 Steps to Follow)

Reporting

Reporting refers to creating and presenting information to your employer or clients. These economists usually generate comprehensive reports on how environmental regulations affect the company's profits. They can also use these skills to present information to the public and explain a company's or government's decisions that affect the environment.

Related: 10 Reporting Tools (With Tips for Effective Data Reporting)

How to become an environmental economist

Follow these steps to start a career path to become an environmental economist:

1. Get an undergraduate degree

The first step to pursuing a career in this field is to get a bachelor's degree in statistics, math, environmental engineering, environmental science, or economics. You can visit the websites of various universities in your province or territory to get more information about available programs. This undergraduate degree might help you get an entry-level job in various fields and start gaining work experience. Employers require these professionals to have a strong understanding of mathematics and statistics because these are two essential skills in this field.

Read more: What Is an Undergraduate Degree? (With Steps to Earn One)

2. Earn a graduate degree

Although some government agencies can hire environmental economists with just a bachelor's degree, most might require them to have a master's degree or a PhD. You can get different types of master's degrees, such as a master of arts in economics, a master of science in environmental economics and climate change, and a master of business administration. You may also get a PhD in environmental economics, environmental policy, or environmental management. These degrees can enable you to specialize in a specific area of environmental economics and find a job that suits your interests.

3. Find a job in the field

After getting your education, you can look for an environmental economist position across different industries, especially those in environmentally regulated sectors, such as oil and gas or mining. You can look for opportunities on an organization's website, job boards, and social media platforms. You can also check government agencies to find job openings, as these organizations often hire environmental economists before issuing new regulations.

It's also beneficial to talk to your contacts in the field to see if they know of any positions. If you want to work in a private firm, such as an oil company, you can research the industry, as this might help you understand the company's core operations and environmental impact.

4. Network in your industry

Finally, it's crucial for you to network with your colleagues, federal and provincial authorities, industry leaders, and environmental non-profit organizations. Doing this can help you keep up-to-date on the latest research, regulations, and best practices. It can also allow you to participate in projects where you can assess the economics of environmentally friendly energies or the impacts of climate change on the national economy.

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