Published on 11th July 2024
The World Employment Confederation welcomes the latest Employment Outlook from the OECD, which this year has focused on a net-zero transition and the policies needed to avoid negative affects on the labour market. Overall, the report says that despite adverse shocks, labour markets have remained strong, with historically high employment and low unemployment rates. But even though job quality has improved and real wages are growing, wages remain below pre-pandemic levels in several OECD countries.
The OECD Employment Outlook 2024: The Net-Zero Transition and the Labour Market details how the transition to net-zero emissions will significantly impact the labour market, with both job losses in high-emission industries and job creation in low-emission activities. To address the challenges, the report emphasises the importance of skilling to help transition workers to new jobs and industries.
The World Employment Confederation (WEC) had the opportunity to contribute to the draft report, and is pleased to see some recommendations make the final version. Notably, apprenticeships and dual-learning programs are promoted as important initiatives needed for the green transition and as ways for businesses to acquire new talent.
WEC is encouraged that the report stresses the importance of social dialogue for all stakeholders in creating effective policies aimed at skilling to close labour gaps.
Targeting low-skilled workers
The report acknowledges the role that the private employment services industry plays in complementing public employment services to help in relocating displaced workers into green-driven jobs, specifically when it comes to skilling and reskilling.
Although skill similarities do exist between Green-house-gas (GHG) intensive and green-driven occupations, low-skilled workers need substantial retraining. The report urges greater focus on the importance and investment in training for low-skilled workers to address both the labour shortages in the green-driven industries and keeping them in active in the labour market.
If attention is not properly paid to low-skilled workers displaced from GHG-intensive industries, there is a risk that they will be left behind in the transition. Another concern is that high-skilled green-driven jobs pay much more than low-skilled, making them an unattractive option to those workers who earned more in GHG-intensive roles. One policy recommendation is the introduction of a ‘wage insurance’ to help cover the wage discrepancy for transitioning workers.
Currently, the OECD says that only 20% of the workforce is employed in green-driven jobs, which will be positively impacted by the net-zero transition. However, job displacement from high-emission industries remains costly.
