Greening the employment market

Greening the economy is currently seen as one of the most active policy prescriptions, especially as part of the broader COVID-19 recovery and stimulus plans. Apart from the positive environmental impact, a green economy is also seen as a key contributor to the creation of new ‘green’ jobs. However, there is yet no agreed definition on green jobs with different institutions adopting different definitions. Based on a review of the latest related data and documents issued by the OECD and the ILO on this topic, the latest grouping of green jobs is determined on their contribution to:

  • improving the efficiency of energy and raw materials,
  • limiting greenhouse gas emissions,
  • minimising waste and pollution,
  • protecting and restoring ecosystems,
  • adaptation to the effects of climate change.

The OECD has taken a leading role in the ‘green growth’ movement through its ‘Green Growth Strategy.’ This strategy links productivity growth, green growth, and inclusive growth, starting from the premise that environmental protection can be a driver for economic growth and social inclusion, rather than a barrier. It is now promoting the mainstreaming of this strategy, with an underlying green growth measurement framework, into national economic policies.

According to the OECD, green policies can trigger job creation in several green economic sectors, even as job destruction occurs in ‘brown’ sectors.[1]A successful transition to a low-carbon, resource-efficient and green economy, if managed well, can lead to more opportunities for workers. In fact, green jobs can create a new job dimension that can absorb several workers impacted by technology disruption across sectors.

As per the OECD’s research and recommendations, the ILO also stresses that low-skilled workers will be the most negatively affected by the green shift. This implies that transition to other jobs may be more difficult and possibly more costly in terms of social benefits and/or retraining schemes.

In a 2018 Working Paper, the ILO studied all available data and recommendations issued by the United Nations Environment Programme (UNEP) and other leading bodies (including the International Trade Union Confederation) and identified four main impacts on the labour market, as condensed in Table 1 below[2].

Table 1: Main employment effects of green policies

Effect Example Anticipated Scale
1 Jobs are created (in existing and new occupations) Solar panel technicians, organic farmers, recycling managers, staff in eco-tourism resorts, workers in natural resource conservation and restoration, environmental advisers, workers in bicycle shops Modest
2 Certain jobs are eliminated Coalminers, workers in the bottling industry adopting water- and material-saving technology, staff in the obsolete or prohibited packaging materials industry. Small
3 Jobs are substituted (occupations change) Jobs in transport systems moving to rail, electric cars, and shared vehicles; waste management jobs in landfill/dumpsites moving to incineration and recycling; jobs in quarries for construction using new building materials and re-using leftovers and waste Modest
4 Jobs are transformed (occupations change) Workers, operators, and managers in greening sectors, notably buildings, agriculture and transport, all learning to manage new technology and operating practices; workers in all sectors where energy and resource efficiency are introduced (such as cleaner production in manufacturing, retail services without packaging, bottle companies changing to new materials and products); staff in financial institutions adopting sustainable investment strategies Large

Source: UNEP, ILO

Three fundamental, long-term trends are driving structural changes in the global employment as environmental concerns continue to shape economic activities:

  • Adoption of more resource-efficient and less harmful technologies and business operations.
  • Physical effects of climate change, e.g., heat stress, with impacts on outdoor work such as agriculture (largest provider of jobs globally).
  • Changing consumer habits and responsive legislation towards promoting more sustainable products and services.

The potentially positive impact of a greener global economy on the global labour market was reiterated in the ILO’s 2018 World Employment and Social Outlook, which concluded that, on balance, shifting towards a green economy creates employment at the global level.[3]Compared to the ‘business-as-usual scenario’, changes in energy production and use to achieve the Paris goals can create around 18 million jobs throughout the world economy. These changes include a shift towards renewable energy sources and greater efficiency, the projected adoption of electric vehicles and construction work to achieve greater energy efficiency in buildings. This net job growth results from the creation of some 24 million new jobs and the loss of around 6 million jobs by 2030.

The EU’s focus on sustainability is captured in its ‘European Green Deal’, announced at the end of 2019. This is a package of policy initiatives aimed at enabling Member States to benefit from sustainable green transition, targeting a goal of zero emissions by 2050 and decoupling economic growth from resource use.

The ‘European Green Deal’, as proposed by the European Commission (EC) at the end of 2019, is a new growth strategy that aims to transform the EU into a fair and prosperous society, with a modern, resource-efficient, and competitive economy where there are no net emissions of greenhouse gases in 2050 and where economic growth is decoupled from resource use. In terms of employment, the key dimension of the Green Deal is the Just Transition Initiative, which allocates funding to manage the transitional impacts on workers. Despite the onset of COVID-19, almost as soon as the Green Deal was released, the Commission has stated that the underlying drivers of change for the strategy remain in place, the need for it is more urgent, and that it will be the “motor for the recovery.”

Reaching the targets of the European Green Deal will require action across all sectors of the economy, including:

  • Decarbonising the energy sector through renewable energy projects, especially wind and solar, and kick-starting a clean hydrogen economy.
  • Investing in environmentally friendly technologies.
  • Supporting industry to innovate.
  • Rolling out cleaner, cheaper and healthier forms of private and public transport.
  • Ensuring buildings are more energy efficient and supporting the circular economy.
  • Working with international partners to improve global environmental standards.

In Europe, job creation related to renewable energy and energy efficiency has been especially strong. This activity stems from the production of renewable energy itself as well as from the manufacturing of renewable energy and energy-efficient equipment, and the provision of green installation, engineering, and research services. The second largest contribution to environmental employment came from waste management. Whereas environmental protection accounted for more than three quarters (78.0 per cent) of the employment in the environmental economy in 2000, the share decreased to 62.0 per cent in 2017 following the creation of new jobs related to renewables and energy-efficiency.

In Malta, the transitioning to a green economy has started. The 2014 National Employment Policy specifies green jobs as an emerging challenge and opportunity for the local labour market, stating that the EU’s commitment to work towards a greener, circular economy (at that point referencing the Europe 2020 targets) would result in an ever-increasing demand for resources in this sphere, as well as the replacement of traditional forms of work with newer, ‘greener’ occupations. This applied particularly to the energy sector given the renewable energy targets imposed proportionally across all Member States.

The issue of green employment was taken up in a policy document issued by the Ministry for Sustainable Development, the Environment and Climate Change in 2015 and entitled ‘Greening our Economy – Achieving a Sustainable Future.’ The key recommendation made was to conduct as soon as possible a skill needs analysis and a review of current training development programmes to factor green skills into the overall training mix. Emphasis is made on the opportunity for people working in traditional sectors to transition into the environmental goods and services sectors.

Another key policy document is the ‘Malta National Energy and Climate Plan’ – this is a strategic planning and policy document setting out the policies and measures that will enable Malta to reach the Energy Union’s 2030 objectives. – these mainly centre around the decarbonisation of Malta’s energy and shift to renewable sources. If the targets of this Plan are to be met, in conjunction with the ambitious targets set by the European Green Deal, then it is anticipated that a demand for green skills will increase, and the reallocation of jobs across sectors to accommodate these changes will occur in line with wider European and international trends.

In April 2021, the National Statistics Office released the results of a Green Jobs Survey carried out in 2020, based on 2019 data. This study classified ‘green jobs’ based on N.A.C.E Rev. 2 classification. This survey estimated that 7,235 workers are currently engaged in green jobs:

  • 76.0 per cent of these are male.
  • 54.0 per cent are in elementary occupations.
  • 55.0 per cent had a secondary level education.
  • 77.0 per cent were aged between 25 and 49 years.
  • 71.0 per cent had wages ranging from €10,000 to €25,000.

This data indicates that more than half of Malta’s green employees are low-skilled. One in every five industries included green jobs in their workforce, with the proportion increasing in larger companies. The top contributing industries are manufacturing (28.0 per cent), wholesale and retail trade (26.0 per cent) and construction (13.0 per cent). The top green activities by companies are renewable energy (22.0 per cent), solid waste management (20.0 per cent) and recycling materials (19.0 per cent).

In March 2022, JobsPlus commissioned a representative national study about green jobs in Malta. Amongst the highlights of the reports, one notes that environmental policy regulations and green technology and innovation were seen as the main drivers to the green transition. From a skills perspective, it was noted that the low-skilled and medium-skilled workers need to adopt new skills whilst upgrade existing skills. In fact, the provision of training was seen as being the most important facilitator for green jobs.

The National Employment Policy is also focused on supporting the transition of the labour market in line with the broader green transition. The focus is very much on enabling the employer to supporting employees in their retraining whilst transitioning their business towards the green economy. It also promotes life-long learning and upskilling of skills at employee level.

Looking ahead, Government is focused on delivering a greener economy. More than half of Malta’s Recovery and Resilience Plan entitlement of €316.4 million in European grants will support climate objectives and the green economy making it the ‘greenest’ Recovery Plan amongst European member states. The green transition is set to continue and gain momentum. It is therefore imperative that the labour market starts this transition too and works closely with the educational sector to ensure that the right upskilling programmes are available for employers and employers to prepare themselves for the expected changes this transition is expected to bring in the labour market.

Article by Jobsplus – Project Intercept in collaboration with Dr. Stephanie Fabri, economist.

[1]The term ‘brown sector’ is used to refer to economic sectors or activities that include practices that are environmentally harmful, e.g., carbon-intensive production.

[2]International Labour Organisation. World Employment and Social Outlook 2018: Greening with Jobs. Geneva, 2018

[3]International Labour Organisation. Greening with Jobs: World Economic and Social Outlook 2019. Geneva, 2018


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