The Future of Green Jobs

What are green jobs and how can companies and organisations support and nurture them? Prof. Stefan Gröschl, ESSEC Business School, interviews Mette Grangaard Lund of the Green Jobs team at the ILO (International Labour Organization).

The Future of Green Jobs, by Stefan Gröschl and Julia Smith. Adapted from an original piece published on ESSEC Knowledge.

Climate change is changing how we live – and how we work. With Gen Z and millennials increasingly engaged in climate change activism, working for a company that prioritizes sustainability is crucial for many young professionals. Luckily for them – and for the environment – the green economy is booming: the International Labour Organization estimates that climate neutrality and resource-efficient economies have the potential to create 100 million new jobs.

The International Labour Organization: Supporting green jobs

For more than a decade, the ILO has supported our constituents – labour unions, employers’ organizations, and governments – on matters pertaining to green jobs and how the world of work will be transformed by climate change. We have a three-pronged approach:

Firstly, through research, analysis and capacity development where we conduct studies on pertinent topics such as global estimates and country studies on job numbers and skills that are in demand. And alongside our training centre in Turin, we provide several courses on how to foster green business growth and support a just transition, which entails maximizing the environmental impact and minimizing the social consequences. We also share and disseminate our findings.

Secondly, through policy development and development cooperation. In addition to producing knowledge at the crossroads of the environment, the climate and employment, we also support constituents in knowledge-based policy development. For example, we train policy makers and economists at the country level using the Green Jobs Assessment Model, which helps policymakers assess the effects of environmental policies on employment. This helps governments get a clearer picture of how to address climate change and social injustice in a holistic way. We also support green job creation through entrepreneurship development and skill development projects.

And lastly, the ILO supports green jobs via strategic partnerships, global and regional engagements. Here, we work closely with our partners and constituents across the globe. We also lead the UN-wide Climate Action for Jobs Initiative, as well as closely follow global policy agendas related to the world of work, with climate change and environmental negotiations such as COP and UNEA, for example, increasingly important to what we do. The ILO has been present at the COP negotiations for more than a decade, and we can see that the just transition, which refers to taking into account the social dimensions of climate action, is increasingly discussed. In sum, we incorporate perspectives of the world of work in these climate and environmental negotiations.

What qualifies as a green job?

While there are different definitions available, the ILO uses three main criteria.  Green jobs must be “decent” jobs – according to our definition, a green job is a decent job in itself.  Decent work covers several dimensions – productive employment (i.e. both quality and quantity), social protection, workers’ rights and social dialogue.

Moreover, a green job can be in any economic sector and is one that contributes to preserving and restoring the environment. Of course, the green job can be in renewable energy and agriculture, which is probably what people think of when they think of green jobs – but it doesn’t have to be. For example, a green job can produce goods or provide services that benefit the environment, like clean transportation.

However, these green products and services are not always based on green production processes and technologies. That is why a green job also can be distinguished by its contribution to more environmentally friendly processes. For example, green jobs can reduce water consumption or improve recycling systems.

Lastly, a green job doesn’t necessarily have to be a highly skilled or specialized job. It can be, but a job like waste collection is also a green job if it meets the requirement of being a decent job. It can be at any skill or specialization level, as long as the job must offer a decent quality of work and of life and its output preserves and restores the environment. 

We also put an emphasis on the outcome of the job: it can be in any sector, but to qualify as a green job, the products and services it delivers must service the environment. In addition, there are some sectors that are inherently green or important, so the ILO focuses more on these than on others. For example, the energy sector is of utmost importance to decarbonization and meeting the Paris Agreement.

 If we reach the goal of keeping global warming below 2°C, 24 million jobs could be created – but around six million could also be lost. So while there is a net job growth, they might not be in the same regions or countries. That is why the ILO focuses on the just transition.

As such, the ILO Just Transition Guidelines suggest that one approach for minimizing the negative effect is ensuring people have the necessary skills to transition to new jobs – since jobs like those in the fossil fuel industry will be less in demand. However, there will be significant new labour demands in renewable energy and new kinds of mining and other rising sectors and industries.

Jobs versus Green jobs: Does the just transition differ from region to region and country to country?

The Future of Green Jobs. 
What are green jobs and how can companies and organisations support and nurture them? Prof. Stefan Gröschl, ESSEC Business School, interviews Mette Grangaard Lund of the Green Jobs team at the ILO (International Labour Organization).

The answer is Yes. There are differences in job gains and losses, both between and within countries. The Middle East and North Africa stand to lose the most jobs, as some of these economies tend to be more fossil fuel dependent in terms of jobs and government revenues.  It doesn’t necessarily mean that the high-income countries are better at developing just transition initiatives – some of the most ambitious just transition policies are in lower-income countries. Lower-income countries nonetheless have a greater need for support, which is where organizations like the ILO come in. There are four main job sectors to highlight here:

The first sector is energy. We talk about this sector a lot as it has a significant climate and environmental impact, but also because there have been impressive initiatives in renewable energy and energy efficiency.

Agriculture and food systems are very important and make up the second sector. Agriculture is the world’s largest employer and is essential for employment in rural areas. but more importantly agricultural jobs are also vulnerable to climate change.

A third sector is Construction – becauseit’s energy-intensive, but also because we see many challenges with decent working conditions. For example, heat stress will become an increasingly large problem that impacts both productivity and employee health.

And a final, fourth sector to highlight, is Transportation. Logistics, infrastructure, and transportation are also important for the economy both to move people and goods around. Decarbonization and job quality are really important in this sector. Other sectors of particular interest include the circular economy and manufacturing.

What key factors move these sectors toward green jobs?

Certain economic sectors, such as energy, are critical in the pursuit of climate goals because of their large share of carbon emissions. Others need to adapt urgently, like agriculture and tourism. Whenever it’s an issue related to the world of work, social partners must be involved. In our approach, we include governments, workers, and employers.

Some of the most successful examples have been between the private sector and the labour unions, where workers support the “greening” of the business as they recognize the potential employment benefits. We need to accelerate climate action, but it won’t be successful if we don’t incorporate the social dimension and get people onboard.

Green jobs and the role of educators

The ILO works very closely with academia and higher education institutions, since skills development is a huge element of the just transition. As I said before, it’s not only highly skilled labour, it’s also technical and vocational training institutions that are a key part of the green transition. We will need people with those skills in the future: waste collection, water treatment, construction and the list goes on.

Often, education has been about enhancing the skills of the workforce, including those in the informal economy. Going forward, more must be done to anticipate the skills needed to prepare young people for jobs of the future.

Indeed, as you said, many institutions, including business schools, are updating their sustainability practices. Green topics are also increasingly important for young people. They will not accept greenwashing and are becoming increasingly critical consumers. As such, if business schools cannot walk the talk, it will backfire. This goes for businesses as well. It’s not enough to pay lip service to green initiatives – there must be actions backing this.

How does the notion of a just transition change manager and leader competencies and responsibilities?

The Future of Green Jobs. What are green jobs and how can companies and organisations support and nurture them? Prof. Stefan Gröschl, ESSEC Business School, interviews Mette Grangaard Lund of the Green Jobs team at the ILO (International Labour Organization).

Three things need to be highlighted here. First, a key element of decent work is gender equality. The leaders of tomorrow must be far more aware of gender equality, gender identity, sexual harassment, flexible working hours, and generally cultivating a safe work environment. As part of that, leaders must ensure that they offer a good work-life balance for all employees, regardless of gender identity. This is increasingly popular even in demanding industries like consulting, where employees are increasingly encouraged to keep an eye on their hours.

Another important element is entrepreneurship. If you are an entrepreneur, you will likely become an employer if your idea takes off. You then have a responsibility to your employees, including formal employment, good working conditions, living wage, and benefits. When you support entrepreneurship, you need to support decent employment for all involved, not just the entrepreneur.

Finally, our world is one of transitions, and as such, there is a need for lifelong learning and upskilling to meet emerging challenges.

The key challenges of green jobs, stakeholders and potential competing demands

While before, some stakeholders may have been resistant, goals are now more aligned. For example, many workers now support decarbonization and the phasing-out of their own jobs, because they have been ensured new green employment opportunities after social dialogue with their companies.

Ensuring green business growth is another important aspect of creating green jobs. For some companies, especially SMEs, figuring out new legislation can be burdensome, so the ILO emphasizes the need to support employers’ organizations and their business members, to better help their members adapt to changes and get past the red tape.

Governments are another key player: it can be very hard for many countries to prioritize decarbonization. But if they invest in jobs and job creation, then you can get a lot of governments on board, since that tends to be a major priority. For example, Biden’s new Green Deal: it proposes creating jobs by greening the infrastructure. There is a strong argument for considering the job effects of environmental and climate change policies, and highlighting this is an effective way to get governments, businesses, workers – and people –  on board. We can’t pick between economic growth, development and job creation on the one hand, and environmental sustainability and climate resilience on the other: the two must go together.

Advice for graduates looking to get into entrepreneurship

As mentioned, entrepreneurs need to make sure they are offering decent working conditions. Once a company hires their first employee, they should identify their employer organization and join that. Often, those organizations have support systems for startups. These organizations can help startups navigate legislation and take advantage of benefits available to them. Moreover, these are often also free.

Another piece of advice for budding entrepreneurs is to be serious about their sustainability strategy. If it’s a superficial initiative, it won’t help, and constitute a reputational risk rather than a competitive advantage. Think about the coherence of your sustainability initiatives with your mission and measure the impact you have, including any negative externalities or unintended effects your business might have. This will make it more authentic for customers and stakeholders.

Climate change is real, it impacts all aspects of our lives, and it requires ambitious and urgent action. If we don’t all get onboard, we won’t succeed. We need to make people, the planet and prosperity a priority, and as such support green jobs and employment creation. By making green jobs a priority and having employees, employers, and governments work together, we can ensure a just transition for all. 

Mette Grangaard Lund, Stefan Gröschl, and Julia Smith on green jobs
Mette Grangaard Lund, Stefan Gröschl, and Julia Smith

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