Deloitte Creates Job Vulnerability Index
Center for Sustainable Progress identifies five ways public policy can support
the Green Collar workforce and help vulnerable regions and industries adapt to
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
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.
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.