New Deloitte Center For Sustainable Progress Report Finds One-Quarter Of The Global Workforce Is Vulnerable To Disruption Driven By Climate Change

Career Climbers / 3rd November 2022

A new Deloitte Center for Sustainable Progress report released today found that more than 800 million jobs—about one-quarter of the global workforce—are highly vulnerable to being disrupted by climate change, from weather extremes to the impacts of transitioning to a low-carbon economy. However, policy makers and business leaders can unleash significant economic growth and help create more than 300 million new jobs around the world by 2050 by building a new Green Collar workforce and making decarbonization work.

Deloitte’s latest report, “Work toward net zero: The rise of the Green Collar workforce in a just transition,” builds on modeling from Deloitte’s Turning Point series to present a more detailed look at the impacts of decarbonization, specifically on jobs. An investment in skills—to create a new Green Collar workforce—is necessary to realize the USD$43 trillion economic dividend identified from coordinated action on climate change. It also explores how policy action to invest in skills development can create a more equitable transition to net-zero globally, creating opportunity and progress.

Deloitte’s research found that climate extremes and uncoordinated shifts away from fossil fuels towards renewables can create substantial risks to millions of workers around the world. To identify the jobs most vulnerable to climate change and decarbonization, the Deloitte Economics Institute constructed a new Job Vulnerability Index. This methodology helps pinpoint the regions and industries needing new assistance and policy interventions.

Building a new Green Collar workforce

The economics of the transition to net-zero emissions will both require—and create—a Green Collar workforce, which will be characterized by new types of work, skills and occupation, and will remake our economy of the future.

The Deloitte Economics Institute highlights that better economic growth will boost the demand for many existing jobs, while the transformation to decarbonize the economy will see some jobs transformed, with new skills and new categories of jobs being created as technology and new economic markets emerge. The report identifies two categories of types of work that are more exposed to the risks of unmanaged costs from the transition to net-zero and climate change damages—those exposed to physical damages from climate change and those who work in high-emissions intensive industries. This underscores the importance of coordinating around the future of these workers and industries.

“Our analysis shows that 80% of the skills that will be required for jobs in our increasingly decarbonized economy already exist. It’s clear that these skills and the Green Collar workforce will be the driver of the transition—not consequence of transition,” says Dr. Pradeep Philip, Partner, Deloitte Economics Institute. “With the right policy support from governments globally, we can create more jobs, better outcomes for workers, and a more equitable distribution of the opportunities created in a net-zero economy.”

Ensuring a just transition with public policy

Deloitte’s report outlines how proactive public policy can support vulnerable regions, industries, and workers during the transition and build the new industrial complex of the future. The Green Collar workforce policy agenda developed by the Deloitte Economics Institute can serve as a guide to actions decision-makers should consider in order to help industries and workers adapt to global decarbonization. 

  • Create high-value jobs for transition pathways: Employment pathways are required that represent an equivalent or higher quality job opportunity to ensure their living standards and meaningful engagement in work are maintained through the low-carbon transition.
  • Reform education and training systems: Education and training systems globally will be responsible for upskilling and retraining disrupted workers, in addition to facilitating pathways into high-growth sectors with in-demand skills. Reforming the education and training sector is critical to realizing the economic potential of decarbonization.
  • Use policy to drive effective skills reallocation: Not all workers, skills, or regions will require the same strategic policy solutions. Taking a portfolio approach will consider workers in the wrong place, with the wrong skills, underutilized workers, and workers that may need a nudge.
  • Set ambitious emissions reduction targets: Clearly defined reduction targets can help industries, businesses, and individuals make effective investment decisions for a timely and coordinated transition. Getting the timing and scale right is key to an active transition that will leave workers better off and lower transition costs for economies overall.
  • Take a systems-based approach for new policy: Accelerating progress toward net-zero emissions and tackling our toughest climate challenges will require extraordinary levels of collaboration and coordination across emerging economic systems—from government, finance, and technology.

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