People walking with reflection on a rainy day
 People walking with reflection on a rainy day

How can workers find their place in the green economy?

The push toward a fossil-free and just and fair transition will shape a new era of economic growth and a new jobs landscape.

This is part of a trilogy of articles exploring the role of governments in accelerating a green and just transition.

In brief

  • Green climate action will have a long-term positive impact on global growth, as governments deliver on their commitments.
  • Total employment will increase, but regions that are most dependent on the fossil fuel sector will take longer to see the benefits of an uptick in green jobs.
  • Government need to make investments, prepare for a new employment ecosystem and provide training through capacity building and greater collaboration.

Governments must be poised to take a proactive role in ensuring a just green transition and a new era of jobs and growth. The importance of green jobs will increase, not only as a component of labor input, but also as a crucial factor for accomplishing the green transition process. This isn’t just about what jobs will disappear and which will be created. There are more fundamental issues at play. The future sustainability of the labor market will be crucial to delivering a just transition for all of society. In a dynamic framework where time is a critical variable, any shortages of human capital will delay the green transition process.

The job market already is being transformed from the bottom up: 65% of employees are more likely to work for companies with environmental policies in line with their own values. Similarly, two-thirds of workers are expressing a desire to learn green skills to become more valuable in the workplace of the future.1

These trends are even stronger when considering the values of generations about to enter the workforce: 88% of business school students consider environmental issues in business a top priority for their future careers. Moreover, two-thirds of students are looking for solutions to integrate sustainability into their future occupations.2

The new green jobs that will make the difference in reaching net-zero environmental ambitions will require a different skillset than those lost in fossil fuel-dependent industries. That’s why it is important that governments focus on the sectors that will create employment opportunities and anticipate the trends that will shape the way people will work in the coming decades.

Engineer walking towards wind turbine

Chapter 1

The great decoupling of emissions and growth

Green climate action will raise global GDP per capita while reducing total energy consumption and CO2 emissions in the long run.

As global governments commit to a phased transition away from fossil fuels into renewable energy, they will need to understand how this new era will shape economic growth, how it will differ from the fossil-fuel age and how they can develop policies and plans to fully support and harness new power sources for the betterment of all.

To better understand what economic growth will look like in the coming years and how it might differ across regional economies, we collaborated with Politecnico di Milano to model the potential value and impacts of the green transition process. Specifically, we focused on what governments’ National Determined Contributions (NDCs) to meet the target of 1.5 degrees Celsius set by the UN 2015 Paris Agreement will mean for gross domestic product (GDP) and jobs growth over the next three decades.

To do this, we modeled two scenarios plus a baseline scenario:

  1. The first scenario is called low-carbon economy (LCE). This scenario models GDP based on Nationally Determined Contribution (NDC) policy announcements, including the COP27 pledges. 
  2. The second scenario is low-carbon economy plus (LCE+), which provides a feasible pathway to minimize carbon emissions beyond political pledges. It is based on reducing emissions by adopting the optimum, least-emissions pathway within key industry sectors and available technologies. 
  3. The third baseline scenario depicts no policy implementation or technological changes, with energy demand driven only by economic growth until 2050.

We predict the first long-term decoupling of GDP from energy consumption — a landmark achievement. Both LCE and LCE+ scenarios will result in a persistent increase of global GDP per capita by 4.7% and 5.2%, respectively, versus the baseline scenario. While global GDP is growing, the trend in total energy consumption from 2040 to 2050 will decrease, thanks to intense policy action in Western countries (the EU27, the UK and the US in particular). This trend is counterbalanced in the 2040 to 2050 decade by growing energy demand in emerging economies.

Total final energy consumption and CO2 emission trends highlight a second long-term decoupling: in the LCE and LCE+ scenarios, the CO2 emission trend in the baseline scenario is reversed. CO2 emissions fall, even after the rebound of energy consumption in the 2040 to 2050 decade because the strong penetration of renewable energy solutions allows higher energy consumption without the CO2 emissions associated with fossil fuels.

In fact, according to the modeling, total energy consumption will rise globally by 23% in 2050 vs. 2020 levels. This growth is led by a rising population and standards of living in emerging economies, especially in India, but is not projected to result in a global increase in CO2 emissions due to technological advances in sustainable energy generation. 

Such transformations will also herald fundamental changes in the global job market, creating new opportunities and positions in the green economy but also making roles in fossil-based industries and dependent sectors redundant.

Asian woman examining bok choy in greenhouse hydroponic vertical farm

Chapter 2

How global employment will evolve in the green growth era

The net effect on employment triggered by the green transition is positive but will harshen inequalities among regions.

Just as economic growth will be reshaped by decoupling from fossil fuel power, so will the jobs market. Occupations that are specifically tied to fossil fuel production may be lost. For example, more than 18 million jobs currently related to oil, gas and coal globally4 may be at risk. Phasing out fossil fuels will affect other workers along the value chain and impact local economies as well.

For governments, a critical part of ensuring a just transition will be balancing the social benefits and risks of reducing fossil fuel jobs while replacing them with green employment. They will have to anticipate what the new labor market will look like — specifically how many new jobs will be created, what skills levels will be needed to fulfill them, where those jobs most likely will be located and whether those currently working in fossil fuel sectors can easily transition into the new green economy. Shalinder Bakshi, EY Global People Advisory Services Leader, Government & Infrastructure said, “To prepare for a new era of green jobs and growth, governments will need to create a positive impact not just in terms of employment, but also equity and inclusiveness.”

The transition is already taking place in some parts of the energy sector. Major oil and gas companies are investing heavily in utility, electricity generation and offshore wind. Both oil and utility providers are seeking to build EV infrastructure. Even mining companies will continue to offer employment opportunities as they transition out of coal into the minerals needed to run many renewable technologies. Upskilling and re-skilling will become key drivers for organizations as they transform their business models, ensuring they keep and attract the right people with green skills to deliver.

None of this transition will be simple — there will be few like-for-like job opportunities and many of the new jobs created will be in different locations and require different skillsets. 

To prepare for a new era of green jobs and growth, governments will need to create a positive impact not just in terms of employment, but also equity and inclusiveness.

Fewer green jobs will be created within eco-industries5 (46 million under the LCE and LCE+ scenarios) than fossil fuel jobs lost because of the higher productivity gains provided by renewable energies (73 million under the LCE scenario). However, millions of new jobs will be created along the entire value chains tied to these core green economy sectors. We call them “other green jobs.” These include manufacturing, transport, construction and other services.

Green jobs
Green jobs will be generated globally under LCE and LCE+ scenarios
Gray jobs
Gray jobs will be lost under the LCE scenario

The net effect on employment is, however, positive; counting the “other green jobs,” net job generation will be 151 million more jobs created under LCE and 120 million jobs under LCE+. (The difference is mainly due to a higher increase in productivity in the LCE+ scenario). However, these changes won't play out uniformly across the world. In fact, the transition will harshen inequalities amongst some regions. When looking at how the employment landscape will change, we were able to identify three key clusters.

The first cluster is composed of the EU27, the UK, China and — to a lesser degree — the US. Here we have regions where a combination of a shrinking labor force (mainly due to demographic patterns) will intersect with higher demand for new green jobs and skills. Countries in this cluster are likely to have more jobs than internal applicants. This means that part of the green job requirement might not be internally met and would have to be attracted from other regions.

The second cluster is composed of the Middle East and — to a lesser degree — Australia. These seem to be the most negatively affected regions due to their heavy specialization in fossil fuel supply chain and trade. For example, oil rents — the difference between the value of crude oil production at regional prices and total costs of production — constitute over 11% of GDP in Middle East and North African (MENA) countries.6 Though this share has fallen significantly in the last decade (it was over 29% in 2011), it is still far above the global average of 1%. Due to the transition, socio-economic sustainability risks will likely increase as the employment rate drops.

The third cluster encompasses India, Southeast Asia and Africa. India and Southeast Asia will almost maintain their employment levels up to 2040 and will improve them in the 2040-2050 decade. Africa, however, is likely to experience a significant initial drop until 2035. In Africa and India, rather than transition-related investments, a significant component of new job creation after 2035 will be due to trade multipliers activated by growth demand in the Organisation for Economic Co-operation and Development (OECD) countries. For example, hydrogen generation in Africa could help the region become a global player through green hydrogen exports, potentially activating €1 trillion of investments.7 And in the mining sector, 58% of the international supply of cobalt — a critical raw material used as a component of cathodes in batteries and as a catalyst in fuel cells — comes from the Democratic Republic of Congo (DRC).8

Green jobs will be crucial in accompanying the transition process even more than support of overall labor input. In fact, a shortage of skilled labor and changing demographic patterns of the working age population associated with decoupling from fossil fuels could lead to stability issues in different regions either by overheating the labor market or increasing social unsustainability.

Team learning together about sustainable energy

Chapter 3

What governments can do to prepare for the green jobs transition

Capacity building and public-private collaboration are key to reshaping the employment ecosystem.

Change is coming at pace in the world of work, driven by an increased need for green jobs. “Halving emissions by 2030 is not just a goal; it’s an economic necessity to build and sustain equitable growth,” says Amy Brachio, EY Global Vice Chair - Sustainability. “Climate action will transform our economies through the growth and development of green jobs required to scale the services and solutions needed for a net zero economy. Companies should start today by investing in the training of a skilled workforce capable of tackling the challenges and opportunities of energy transition.”

As economies of scale in the energy, manufacturing and construction sectors begin to favor green products and solutions, the pace will quicken even more rapidly. Government and business must ask: how can we best prepare now for the change we know is coming? 

Climate action will transform our economies through the growth and development of green jobs required to scale the services and solutions needed for a net zero economy.

A two-step overarching strategy is needed.

The first step is to adopt a multi-stakeholder approach ⏤ one that brings governments, the business community and key third-party stakeholders, including academia, schools and trade associations, together to reshape the employment landscape. Second, that multistakeholder approach can create a new ecosystem where the demand for green jobs will come from and new talent can emerge. “The need for more green jobs will intensify as global economies accelerate the just transition away from fossil fuels. To respond to this shift in demand and to nurture future talent, governments will need to collaborate with educators and business to foster green skills and competencies for people starting their careers as well as workers who need to be re-skilled,” says George Atalla, EY Global Government & Public Sector Leader.

To respond to this shift in demand and to nurture future talent, governments will need to collaborate with educators and business to foster green skills and competencies.

Needed new roles will involve engineering, digital, problem-solving, monitoring, management and critical thinking skills. To respond to this demand, we believe that governments and policymakers need to focus on four areas:

  1. Public sector capacity building and internal training policies to support the execution of the green transition. Governments must anticipate increased demand for new types of skills and know-how to deliver on green initiatives. Targeted funding and a national green skills plan can help map out the quantity and type of skills needed, where new green jobs should be located (to ensure that no regions are left behind), and how to invest in education and retraining.
  2. Coherent policies within sectors that create and support efficient social and financial mechanisms for life long learning (including social protection allowing for an opportunity to undertake training for a green job when leaving the previous occupation) and re-skilling people into new occupations.
  3. Education programs for young people that introduce green skills (e.g., sustainability and circular economy knowledge) and digital competencies (e.g., programming, data analytics and information security). Digital also impacts on how green jobs will be delivered in an emerging hybrid environment where teams are working remotely, online, in person and offshore. Openness to these types of working dynamics will also impact an organization’s diversity and inclusion agenda and the wellbeing of employees — all critical factors in driving a better ESG strategy for an organization.
  4. Business and governments should closely collaborate to make sure existing employees are best equipped to transition into green jobs and that new employees enter a working environment that can make the best use of their skills.

Shaping the future of the jobs market to deliver a just transition

The challenges governments will face will only increase as our climate crisis intensifies. The required shift to a green economy involves more than just creating and replacing jobs; it requires a fundamental restructuring of the labor market to ensure a sustainable and equitable transition. Current trends indicate a growing demand for green skills and environmentally conscious workplaces among employees and students, highlighting the need for governments to invest in education and training programs to meet these demands. While the challenge is immense, effective leadership — planning and acting now — will help shape a future that benefits future generations and creates positive legacies.

The authors of this article would like to give special thanks to Shalinder Bakshi and Marco Cavalli from the EY organization for their insights.


If the global economy really is to transition away from fossil fuels, that transformation will bring with it a fundamental shift in the employment landscape — creating new green jobs and careers but ending many jobs that are tied to fossil fuel production. How governments support the upskilling and re-skilling of the existing workforce while also preparing a new generation for employment in the green economy will determine the success of a just transition away from fossil fuels.

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