World Employment and Social Outlook 2018

ILO

2018 WORLD E MPLOYMENT AND SOCIAL OUTLOOK – Greening with jobs

with jobs

Greening

2018

OUTLOOK

WORLD

EMPLOYMENT

SOCIAL

International Labour Ofce

•

Geneva

WORLD

EMPLOYMENT

SOCIAL

OUTLOOK

2018

Greening with jobs

World Employment and Social Outlook 2018: Greening with jobs

International Labour Ofce–Geneva: ILO, 2018

ISBN 978-92-2-131646-6 (print)

ISBN 978-92-2-131647-3 (web pdf)

ISBN 978-92-2-131648-0 (epub)

ISBN 978-92-2-131649-7 (mobi)

green jobs / employment creation / sustainable development / social dialogue

13.01.3

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Preface iii

The world of work is intrinsically linked to the natural environment. Jobs in agriculture, sheries, for-

estry, tourism and other industries including pharmaceuticals, textiles and food and beverage depend

on a healthy environment. Temperature rises like those expected due to climate change will increase

the number of days that are too hot to work, putting workers’ health at risk and reducing productivity.

We may soon reach the point in which the jobs created or improved by economic development risk

being destroyed or worsened by the resulting environmental degradation. The world of work needs

environmental sustainability.

Social justice requires it, given the large inequalities in the impact of the negative effects of environ-

mental degradation.

As I highlighted in my Report to the 106th Session of the International Labour Conference, there need

be no tension or contradiction between economic growth and jobs on the one hand, and environmental

sustainability on the other. This development path is embedded in the Paris Agreement, with its refer-

ence to the imperative of a just transition.

The present report shows that achieving environmental sustainability can create jobs. The green

economy will be a major source of job growth in the future of work. Taking action in the energy sector

to limit global warming to 2 degrees Celsius by the end of the century can create around 24million

jobs, largely offsetting any job losses. Embracing the circular economy to reduce material extraction

and waste generation will also result in net job gains.

The job-creating potential of environmental sustainability is not a given: the right policies are needed

to promote green industries while ensuring decent work within them. They are also needed to allow

workers to transition to new sectors and to protect those who may lose out due to lower activity in

industries that contribute to environmental degradation.

In 2013, the ILO launched the Green Initiative as one of the seven initiatives to mark the

ILO’s centenary in 2019. It aims to better equip the actors of the world of work to under-

stand the challenges and opportunities of the transition and to take up the active role that

they must play in managing this change. This report is one step towards this end, along with the

Guidelines for a just transition towards environmentally sustainable economies and societies

forall, which guides ILO’s work, including the ILO Green Jobs Programme.

As this report shows, there is scope for policies in the world of work to advance environmental sus-

tainability; and for environmental policies to ensure decent work. A coherent and integrated legal

framework is a step in this direction. Labour regulations on occupational safety and health, for example,

can contribute to the preservation of the environment. Advances have been made by including decent

work issues in environmental regulations, such as climate action policies that take note of their skills

implications. Providing workers with the right set of skills and recognizing workers’ skills will help the

transition to sectors with employment growth, and also to better jobs. Social protection systems can

support workers’ incomes against risks stemming from climate change and local environmental deg-

radation. Social dialogue contributes to nding innovative ways to mitigate environmental impacts that

are reducing or negatively affecting employment or working conditions.

It is too late for the world to grow now, and only clean up later. It is time to grow clean, to go green.

The Sustainable Development Goals are clear in the desire to combine decent work for all with en-

vironmental sustainability. This report shows it is possible and allows us to plan, not just wish for, a

sustainable future.

Guy Ryder

ILO Director-General

Preface

Acknowledgements v

Acknowledgements

The World Employment and Social Outlook 2018: Greening with jobs was prepared by the Work, Income

and Equity Unit (led by Catherine Saget) of the ILO Research Department, under the coordination

and technical guidance of its a.i. Directors Moazam Mahmood and Sangheon Lee, and Director

Damian Grimshaw.

The ILO Research Department highly acknowledges the comments and is grateful for the solid policy-

driven suggestions provided by Deborah Greeneld, ILO Deputy Director-General for Policy, and James

Howard, Senior Adviser to the Director-General. The team wishes to thank colleagues in the ILO’s Green

Jobs Programme (Kamal Gueye and Marek Harsdorff) and the Skills and Employability Branch (Srinivas

B. Reddy and Olga Strietska-Ilina) for their close collaboration, support, input and contributions.

The authors of the different chapters are: Chapter 1 – Guillermo Montt, with contributions from Nicolas

Maitre; Chapter2 – Guillermo Montt, with contributions from Jeronim Capaldo, Michela Esposito,

Marek Harsdorff, Nicolas Maitre and Daniel Samaan; Chapter 3 – Tahmina Karimova and Elizabeth

Echeverría Manrique; Chapter 4 – Nicolas Maitre, with contributions from Christina Behrendt, James

Canonge, Luis Cotinguiba, Fabio Duran, Valérie Schmitt and Stefan Urban (ILO Social Protection

Department), Jeronim Capaldo and Guillermo Montt; and Chapter5 – Takaaki Kizu, Tahmina Mahmud

and Catherine Saget, with inputs from Olga Strietska-Ilina. Valuable support was provided by Silas Amo-

Agyei, Susanna Biancacci, Solveig Boyer, Karin Isaksson, Dorit Kemter, Trang Luu and Elsa Tapsoba.

Tord Kjellstrom developed the methodology and calculated the impact of heat stress on working hours

in Chapter 1. Kirsten Wiebe, Richard Wood and Moana Simas from the Norwegian University of Science

and Technology (NTNU) developed the methodology and calculated the employment scenarios in

Chapter 2. The national studies used in Chapter 5 are the result of collaboration between the ILO

and the European Centre for the Development of Vocational Training (Cedefop). Country studies were

carried out by Cedefop (Denmark, Estonia, France, Germany, Spain and the United Kingdom) and

national experts and research institutions from Australia (Huon Curtis, Nigel Douglas, Peter Fairbrother,

Kate Grosser, Val Propokiv, Michael Rafferty, Philip Toner), Bangladesh (Abdul Hye Mondal), Barbados

(Centre for Resource Management and Environmental Studies and the Department of Economics,

The University of the West Indies), Brazil (Carlos Eduardo Frickmann Young, Maria Gabrielle Correa,

Lucas de Almeida Nogueira da Costa, Marcos Pires Mendes), China (Ying Zhang from the Institute

for Urban and Environmental Studies, Chinese Academy of Social Sciences), Costa Rica (Instituto

Centroamericano de Administración de Empresas (INCAE) Business School), Egypt (Ghada Amin),

Guyana (Rawle Andrew Small and Maria Witz), India (Vipan Kumar, Arpit Choudhary, Naresh Kumar,

Kasturi Mandal in the National Institute of Science Technology and Development Studies (NISTADS)),

Indonesia (Business Council for Sustainable Development (IBCSD)), the Republic of Korea (Misug Jin),

Kyrgyzstan (Kylychbek Djakupov, Anar Beishembaeva, Muktar Djumaliev, Elmira Ibraeva and Cholpon

Kalmyrzaeva), Mali (Mali-Folkecenter Nyetaa), Mauritius (Riad Sultan), Montenegro (Dragan Djuric),

Philippines (Mary Ann Fernández-Mendoza and Lucita S. Lazo), South Africa (OneWorld Sustainable

Investements), Tajikistan (Lutfullo Saidmurodov and Tahmina Mahmud), Thailand (Ruttiya Bhula-or),

Uganda (John David Kabasa, Sengooba Asuman, Bukirwa Jana and Hana Kisakye in the Countryside

Innovations Network Ltd) and the United States (Heidi Garrett-Peltier in the Political Economy Research

Institute (PERI), University of Massachusetts).

The Department would like to thank the ILO Regional and Country Ofce Directors and Deputy Directors

for their comments and coordination of the national studies in the eld, in particular Fabio Bertranou,

Claudia Coenjaerts, Xiaochu Dai, Olga Koulaeva, Peter Poschen, José Manuel Salazar-Xirinachs, Peter

Van Rooij and Dagmar Walter.

The team appreciates the comments received from the members of the ILO Research Review Group

who attended the meetings on 1 December 2016 and 13 November 2017, namely Professors Iain Begg,

Gary Fields, Jayati Ghosh, Nouri Mzid and Lord Robert Skidelsky. We are also grateful for comments

from ITUC, IOE, Lais Wendel Abramo and Beatriz Morales (ECLAC), Michael Renner (IRENA), Jean

Château, Rob Dellink, Andrés Fuentes, Jaco Tavernier and Glenda Quintini (OECD), Steven Stone

(UN Environment), David Waskow and Juan Carlos Altamirano (World Resources Institute) and two

anonymous reviewers, as well as Ralf Krueger (ILO/ITC Turin).

vi World Employment and Social Outlook 2018 – Greening with jobs

The ILO Research Department thanks numerous colleagues from other ILO Departments, Regional

and Country Ofces for their comments: Andrés Acuña Ulate, Cheickh Badiane, Pavan Baichoo,

Gabriel Bordado, Laura Brewer, Meredith Byrne, Jae-Hee Chang, Jealous Chirove, Paul Comyn, Sukti

Dasgupta, Rishabh Dhir, Yacouba Diallo, Mauricio Dierckxsens, Anne Drouin, Sara Elder, Simel Esim,

Kamran Fannizadeh, Colin Fenwick, Mariangels Fortuny, Youcef Ghellab, Eric Gravel, Tendy Gunawan,

Christine Hofmann, Akira Isawa, Kavunga Kambale, Steven Kapsos, Claire La Hovary, Josée-Anne

La Rue, Michelle Leighton, Erica Martin, Cristina Martínez, Franklin Muchiri, Hassan Ndahi, Walter

Nebuloni, Martin Oelz, Lene Olsen, Bolotbek Orokov, Moussa Oumarou, Gwyneth Anne Palmos,

Konstantinos Papadakis, Georginia Pascual, Anne Posthuma, Aishwarya Pothula, Mikhail Pouchkin,

Álvaro Ramírez Bogantes, Ana Rasovic, Akiko Sakamoto, Ken Chamuva Shawa, Kishore Kumar Singh,

Valentina Stoevska, Charalampos Stylogiannis, Kanae Tada, Manuela Tomei, Mito Tsukamoto, Fernando

Vargas, Vic van Vuuren and Maria Ilca Lima Webster.

The team would like to acknowledge the inputs, helpful comments and technical recommendations of

the past and present colleagues in ILO Research Department: Antonia Asenjo, Marva Corley-Coulibaly,

Guillaume Delautre, Ekkehard Ernst, Verónica Escudero, Andre Gama, Carla Henry, Jeff Johnson,

Stefan Kühn, Elva Lopez Mourelo, Rossana Merola, Santo Milasi, Clemente Pignatti, Ira Postolachi,

Uma Rani, Pelin Sekerler Richiardi, Pamphile Sossa, Steven Tobin, Ngoc-han Tran, Christian Viegelahn,

Zheng Wang and Sheena Yoon.

Table of contents vii

Table of contents

Preface iii

Acknowledgements v

Executive summary 1

1. Environmental sustainability and decent work 7

Introduction 8

A. Economic growth, decent work and environmental degradation 9

B. The relationship between progress towards environmental sustainability

and progress towards decent work 15

C. The tight link between jobs and the environment 17

Conclusions 29

References 30

2. Employment and the role of workers and employers in a green economy 37

Introduction 38

A. Job creation and job destruction in the transition to a green economy 39

B. Green jobs 53

C. Green enterprises: Key actors in the transition 56

Conclusions 62

References 63

3. Regulatory frameworks: Integration, partnerships and dialogue 71

Introduction 72

A. Integration of environmental protection and labour issues at the international level 73

B. Mainstreaming decent work in laws and policies at the national level 85

C. Greening the workplace through social dialogue 92

Conclusions 98

References 99

4. Protecting workers and the environment 103

Introduction 104

A. The link between poverty, social protection, incomesecurity and the environment 105

B. Unemployment protection and structural transformation in the context of climate change 106

C. Cash transfer programmes 108

D. Public employment programmes 110

E. Payments for ecosystem services 114

F. Simulation 119

Conclusions 123

References 124

5. Skills for the green transition 129

Introduction 130

A. Skills development regulations and policies 131

B. Skills development programmes and initiatives for greening the economy 139

C. Mapping the institutional structure of skills policies and programmes 147

Conclusions 150

References 152

viii World Employment and Social Outlook 2018 – Greening with jobs

Appendices 157

Appendix 1 157

Appendix 2 162

Appendix 3 176

Appendix 4 178

References 180

Glossary 185

Figures

1.1 GDP and GHG emissions growth, 1995–2014 or latest year available 11

1.2 Total GHG emissions, materials and resource extraction and land use,

2000–14 or latest year available 12

1.3 Global GDP and GHG emissions, 1995–2015 13

1.4 Decoupling of production and consumption-based emissions, 1995–2013 14

1.5 Changes in labour market outcomes for coupled and decoupled countries, 1995–2014 15

1.6 Carbon and resource intensity of employment, 2000–14 or latest year available 18

1.7 Employment, GHG emissions and material extraction by sector, 2014 19

1.8 Working-life years lost due to disasters, 2000–15 24

1.9 Working hours lost to heat stress under a 1.5°C scenario, 1995–2030 27

Boxes

1.1 Consumption- and production-based emissions and resource use: The role of trade 10

1.2 Ecosystem services are essential for people in poverty and for indigenous

and tribal peoples, who are key actors in conservation 20

1.3 Overexploitation of sh stocks could destroy 85.7million jobs 22

2.1 Estimating green economy employment scenarios using Exiobase 39

2.2 Investment for environmental sustainability 40

2.3 Employment and decent work under the 1.5°C goal 41

2.4 Conservation agriculture minimizes soil disruption and increases yields 46

2.5 Organic agriculture relies on ecological processes, biodiversity and natural cycles 47

2.6 Jobs in the environmental goods and services sector 54

2.7 Implementing the Guidelines for a just transition in Uruguay and the Philippines 55

3.1 The relationship between the working environment and the general environment 76

3.2 Implementation of the Prevention of Major Industrial Accidents Convention, 1993 (No.174):

Recent CEACR comments 78

3.3 Integrated environmental and labour regulation: The case of the Hong Kong International

Convention for the Safe and Environmentally Sound Recycling of Ships (2009) 83

3.4 Greening jobs in sub-Saharan Africa 86

3.5 Environmental rights at work: The French Labour Code 88

3.6 International framework agreements 95

4.1 High-impact opportunities for environmentally oriented public employment programmes 112

4.2 Features of payments for ecosystem services (PES) schemes 116

5.1 The Philippines Green Jobs Act of 2016 132

5.2 Nationwide survey of renewable energy jobs in India 133

5.3 Training in the use of improved cooking stoves in Uganda 143

5.4 Skills for green transition in waste management and recycling:

The potential for decent work? 145

Table of contents ix

1.10 Jobs in unsustainable economic activities undermine equal opportunity 29

2.1 Energy sustainability and employment in 2030 43

2.2 Sustainability in agriculture and employment in 2030 49

2.3 The circular economy and employment in 2030 51

2.4 Firms identifying at least one opportunity or risk from climate change,

2010–15 (percentages) 57

2.5 Firms that decoupled GHG emissions from sales growth, 2010–15 58

2.6 Change in sales, GHG emissions and employment for coupled and decoupled rms,

2010–15 59

2.7 Payback period for initiatives to reduce GHG emissions 60

3.1 The structure of ILS from an environmental protection perspective 76

3.2 Ratication by ILO member States of MEAs with OSH provisions vis-à-vis the Occupational

Safety and Health Convention, 1981 (No. 155), and ratication of certain other ILS 84

3.3 Breakdown of labour dimensions in general climate change policies 89

3.4 OSH issues in legislation relevant to green transition (analysis of 40 countries by sector

andfocus area) 91

4.1 Socio-economic and environmental challenges are intricately interlinked 106

4.2 Percentage of workers covered by unemployment protection schemes, by region,

latest year available 108

4.3 Public employment programme components 113

4.4 Public employment programme components, by region 114

4.5 Pro-poor components in payment for ecosystem services (PES) schemes 118

4.6 Social protection policies for a green economy 119

4.7 GDP growth rate (baseline scenario vs green scenario), selected countries 120

4.8 Employment rate (difference between the green scenario and the baseline scenario) 122

5.1 Indonesia: Number of graduates certied as energy managers and energy auditors,

2012–16 137

A2.1 Changes related to technology diffusion in an environmentally extended

input–output framework 167

Tables

1.1 Labour market outcomes and GHG emissions 16

1.2 Jobs relying on ecosystem services, 2014 21

2.1 Sectors most affected by the transition to sustainability in the energy sector 44

2.2 Environmental and work-related impacts of conservation and organic agriculture 48

2.3 Sectors most affected by the transition to sustainability in agriculture 50

2.4 Sectors most affected by the transition to a circular economy 52

2.5 The business implications of environmental degradation 57

3.1 International labour standards relevant to climate adaptation and mitigation policies 74

3.2 Contribution of international labour standards to the sustainable development

normative framework 80

3.3 Labour issues in multilateral environmental agreements 82

3.4 Examples of labour dimensions in national legislation on green growth 87

3.5 Examples of green policies that include labour issues 89

3.6 Labour considerations in energy legislation by country income group

(analysis of 40 countries) 90

3.7 Green provisions in a national context: Examples of Canadian collective bargaining practice 94

3.8 List of main green commitments in IFAs 97

3.9 List of innovative but less common green commitments 97

x World Employment and Social Outlook 2018 – Greening with jobs

5.1 India: Estimated additional workforce required in solar and wind energy sectors, 2017–18 133

5.2 Priority sectors and occupations affected by the transition to a green economy 136

5.3 Institutional mechanisms to anticipate skills needs

and adapt training provision (27 countries) 148

A1.1 Relationship between employment outcomes and GHG emissions 158

A2.1 Exiobase industry aggregation used in the report 163

A2.2 Input and yield ratios comparing organic and conventional agriculture 170

A2.3 Input and yield ratios comparing conservation and conventional agriculture 170

A2.4 Differences in GHC emission target between experts 171

A2.5 Size of rms available in FactSet with CDP data for both 2010 and 2015 175

A2.6 Sectoral distribution of rms in FactSet with CDP data

for both 2010 and 2015 175

A2.7 Regional distribution of rms in FactSet with CDP data

for both 2010 and 2015 175

Executive summary 1

Executive summary

Action to limit global warming to 2°C will create jobs

The long-term goal of the 2015 Paris Agreement is to keep the increase in global average temperature

to less than 2°C above pre-industrial levels. The Agreement aims to help countries meet this target

and strengthen societies’ capacities to address the wide-ranging impacts of climate change. The

employment estimates in this report suggest that the net effect on job numbers will be positive. The

transition to a green economy will inevitably cause job losses in certain sectors as carbon- and re-

source-intensive industries are scaled down, but they will be more than offset by new job opportunities.

Measures taken in the production and use of energy, for example, will lead to job losses of around

6million as well as the creation of some 24million jobs. The net increase of approximately 18million

jobs across the world will be the result of the adoption of sustainable practices, including changes in the

energy mix, the projected growth in the use of electric vehicles, and increases in energy efciency in

existing and future buildings. In order to ensure a just transition, efforts to promote the green economy

must be accompanied by policies that facilitate the reallocation of workers, advance decent work, offer

local solutions and support displaced workers.

A transition to agricultural sustainability and a circular

economy will result in more and often better jobs

The adoption of more sustainable agricultural policies can create wage employment in medium and

large organic farms, and allow smallholders to diversify their sources of income through a transition

to conservation agriculture. With complementary policies to support workers, adopting conservation

agriculture can help sustain a structural transformation in developing countries. In parallel, embracing

a circular economy that emphasizes the reuse, recycling, remanufacture and repair of goods will create

around 6million new employment opportunities across the world as such actions replace the traditional

model of “extract, make, use and dispose”.

The transition is urgent, given the unsustainable pressure

of current economic activity on the environment

Substantial progress was achieved during the period between 2000 and 2015 in the global economy

and in the promotion of decent work, especially in the form of a reduction in working poverty and

child labour. But wage growth has stagnated and, to a large extent, inequality has risen. Moreover, it

is striking that in a context of scarce resources and limited ability to absorb waste, current patterns

of economic growth rely largely on the extraction of resources, manufacturing, consumption and the

generation of waste. In 2013, for example, humanity used 1.7times the amount of resources and waste

that the biosphere was able to regenerate and absorb. Indeed, human activity has already caused

irreversible environmental change on a global scale.

2 World Employment and Social Outlook 2018 – Greening with jobs

Jobs rely heavily on a healthy and stable environment

and the services it provides…

From a jobs perspective, environmental sustainability is critical. In fact, the increasing frequency and

intensity of natural disasters associated with human activity have already lowered productivity. Annually,

between 2000 and 2015, natural disasters caused or exacerbated by humanity resulted in a global loss

of working-life years equivalent to 0.8per cent of a year’s work. Looking ahead, projected temperature

increases will make heat stress more common, reducing the total number of working hours by 2.0per

cent globally by 2030 and affecting above all workers in agriculture and in developing countries. The

damage associated with unmitigated climate change will therefore undermine GDP growth, product-

ivity, and working conditions. Local air, water and soil pollution and other forms of environmental deg-

radation negatively affect workers’ health, income, food and fuel security, as well as their productivity.

This negative impact can be reduced by the adoption of specic policy measures, including occupa-

tional safety and health measures, social protection policies and other actions designed to adapt to a

changing environment.

… which highlights the critical nature of the transition

toenvironmental sustainability for the world of work

Currently, 1.2 billion jobs rely directly on the effective management and sustainability of a healthy

environment, in particular jobs in farming, shing and forestry dependent on natural processes such as

air and water purication, soil renewal and fertilization, pollination, pest control, the moderation of ex-

treme temperatures, and protection against storms, oods and strong winds. Environmental degradation

threatens these ecosystem services and the jobs that depend on them. The effects of environmental

degradation on the world of work are particularly acute for the most vulnerable workers. Workers from

lower-income countries and Small Island Developing States, rural workers, people in poverty, indigenous

and tribal peoples and other disadvantaged groups are affected the most by the impact of climate change.

The transition to a green economy is not only urgent for the sake of the planet but is also compatible

with improvements in decent work. A key nding of this report is that some countries have succeeded

in improving labour market outcomes while at the same time decoupling growth from carbon emissions.

Complementary policies can promote employment

and mitigate the effects of climate change

Although climate change mitigation measures may result in short-term employment losses, their

negative impact on GDP growth, employment and inequality can be reduced through appropriate

policies. Climate change mitigation could bring down slightly the share of women in total employment

unless action is taken to reduce occupational segregation, as employment gains associated with the

2°Cscenario are likely to create jobs in currently male-dominated industries (renewables, manufac-

turing and construction). Coordination between the social partners can reduce inequality and promote

efciency gains, while coordination at the international level is necessary to achieve meaningful cuts

in emissions. Certain mitigation policies (such as limiting the increase in temperature, for example by

promoting renewable energy) may act as an incentive for enterprises to develop and adopt more ef-

cient technology, thereby boosting employment in key occupations, as well as productivity. Adaptation

policies (e.g. converting to climate-resilient agriculture practice) can also create jobs at the local level.

The legal framework can provide incentives for greening

the economy, while ensuring decent work

Legal standards can promote progress towards decent work during and beyond the transition to en-

vironmental sustainability. By virtue of their broad acceptance and universal relevance for workers,

workplaces and the various sectors, international labour standards provide a social pillar for the green

economy and can help to ensure that emerging sectors offer decent working conditions. In addition,

ILO standards on occupational safety and health contribute to the preservation of the environment.

The Indigenous and Tribal Peoples Convention, 1989 (No.169), which requires environmental impact

assessments to be carried out in relation to development activities that may affect that population,

Executive summary 3

the Prevention of Major Industrial Accidents Convention, 1993 (No.174), and the Employment and

Decent Work for Peace and Resilience Recommendation, 2017 (No.205), among others, address

environmental issues directly.

Multilateral environmental agreements (MEAs), which are binding agreements between States dealing

with environmental matters, increasingly include labour dimensions such as the importance of envir-

onmental rights at work, employment protection and promotion. They place particular emphasis on

occupational safety and health standards. At the national level, environmental legislation and policies

increasingly incorporate labour issues. In19of the 26national legal frameworks reviewed for this

report, climate change policies contain labour considerations, including complementary skills policies

and job creation. Sector-specic environmental legislation also tends to cover employment and decent

work issues. The strong links between environmental regulation and labour issues are also more and

more evident insub- Saharan Africa in the renewable energy and waste management sectors.

Social dialogue contributes to ensuring

that the green transition is a just transition

Social dialogue has contributed to making environmental governance more labour-friendly by promoting

frameworks, legislation and policies that include both labour and environmental concerns. This illus-

trates the priorities established by the UN Agenda for Sustainable Development and the principles

embedded in international labour standards, including the importance of consultation and collective bar-

gaining. At the international level, international framework agreements (IFAs) are voluntary agreements

between multinational enterprises and global union federations. Of the 104IFAs reviewed for this report,

61include environmental provisions on such issues as respect for the environment as a corporate re-

sponsibility and waste management measures, particularly in the manufacturing, energy, mining and

automotive industries. At the national and enterprise level, while the number of collective agreements

containing green clauses is still limited, they are used by employers and workers to reconcile social

and economic objectives with environmental concerns. Emerging examples indicate that workers and

employers, through social dialogue, have identied areas where the environmental impact could be miti-

gated without reducing or negatively affecting employment or working conditions. In the longer term, the

protection of environmental rights at work could also be strengthened in national policies and legislation.

Synergies between social protection and environmental policy

can support both workers’ incomes and the green transition

Social protection systems are the rst line of protection against the negative effects on income of dif-

ferent risks, including those stemming from climate change and local environmental degradation. They

support the economy by stabilizing household incomes. Four policy areas offer particular synergies

between social protection and environmental sustainability: unemployment protection, cash transfer

programmes, public employment programmes (PEPs) and payments for ecosystem services (PES).

Unemployment protection schemes and cash transfer programmes play a critical role in supporting

workers facing job loss related either to the transition to environmental sustainability or to a natural

disaster. They facilitate the transition to new jobs, particularly when combined with skills development

and job placement or relocation measures. In addition, access to safe and regular labour migration

opportunities can foster economic diversication and increase adaptive capacity through remittances

and skills transfer. Cash transfer programmes contribute to preventing poverty and reducing the vulner-

ability of households and communities.

PEPs too can be powerful tools to address the impact of climate change on workers and their incomes,

while also enhancing mitigation. Half of the 86PEPs in 62countries surveyed include an environmental

component. They often provide health care, education and other benets. Similarly, PES, although

originally conceived with an environmental objective, can provide effective support for household in-

comes in specic circumstances.

A policy mix comprising cash transfers, stronger social insurance and limits on the use of fossil fuels

could lead to faster economic growth, stronger employment creation and a fairer income distribution,

as well as lower greenhouse gas emissions.

4 World Employment and Social Outlook 2018 – Greening with jobs

Although skills development programmes for enterprises and workers facilitate

the transition to a green economy, they are yet to be mainstreamed in policy discussions

Skills development programmes are crucial to the achievement of a just transition. Of the 27countries

surveyed, about two-thirds have established platforms to anticipate skills needs and the provision of

training in general, but they are not all used to discuss the skills implications of the green transition. The

active participation of social partners is useful in identifying skills gaps, implementing training provisions,

emphasizing that higher skills translate into higher pay, and recognizing the skills acquired on the job.

However, social partners are not always involved in the relevant discussions; this is especially the case

of workers. Where they exist, specic bodies to discuss skills for the green transition have led to positive

changes in training for the sectors directly involved in the transition (such as renewable energy and waste

management), but they have comparatively little inuence on the greening of the economy as a whole.

National environmental legislation increasingly refers to skills development but the provisions are

often limited to specic skills policy areas (such as the identication of skills needs), target groups

(e.g.youth), sectors (especially energy) or regions. Consensus has not yet been reached in many

countries on the denition of skills for the green transition and the capacity is lacking to collect relevant

data for reliable skills identication. As a result, skills development policies for the green transition tend

to adopt a short-term and fragmented approach. Greater awareness of environmental issues and their

mainstreaming in skills policy discussions are required to ensure that identication of skills needs and

implementation of training programmes respond to labour market needs.

Institutions, policy-making and effective implementation

are key for a just transition

Social dialogue, the elimination of discrimination in employment and occupation, and good governance

are the foundations of an effective and just transition. For example, the involvement of central and local

governments, social partners and NGOs in debates on climate change at the national level has led to

the integration of economic, social and environmental objectives. Tax reform can support the transition

to a green economy, while at the same time facilitating employment creation.

Low-income and some middle-income countries need support to develop data collection, identify and

adopt best practices, strengthen implementation and nance both mitigation and adaptation strategies

in order to achieve a just transition to environmentally sustainable economies and societies for all.

Ajust transition requires identifying and implementing policy solutions to some of the most pressing

challenges to the future of work that also affect climate change, such as employment and working

conditions in the rural economy, demographic shifts and globalization.

A just transition offers enhanced potential for decent job creation

through the integration of labour and environmental issues

This ILO report quanties job losses and job creation in the transition to a green economy, based on

projections to 2030 founded on the agreed policy goal of limiting global warming to2°C. More gen-

erally, it nds that the greening of economies can have a positive overall effect on growth and jobs.

Positive employment outcomes will also probably apply in the 1.5°Cscenario, as encouraged by the

Paris Agreement.

The report shows that environmental laws, regulations and policies that include labour issues offer a

powerful means of integrating elements of the Decent Work Agendawith environmental objectives.

This is true for social protection programmes, skills development programmes, macroeconomic policy

and the legal framework. Though some degree of integration is observed in all these domains, it is

not yet systematic and not yet universal. For example, while environmental legal frameworks can be

effective in combining some elements of the Decent Work Agenda with environmental objectives, the

respective provisions often focus on particular groups of workers (such as additional support for local

communities, training in areas that are key for the transition, and the protection of workers in specic

sectors). The transition affects all workers, however; the universality of rights and protection therefore

remains important to ensure that the transition delivers inclusive growth and decent work.

1. Environmental sustainability and decent work 7

KEY FINDINGS

Across the world between 1999 and 2015, GDP grew by almost 80per cent, real wages im-

proved by 42per cent, child labour fell and female labour force participation increased. Under

certain thresholds, working poverty also fell. Yet, despite this progress, inequality has risen.

Between 2000 and 2012, greenhouse gas (GHG) emissions, which cause climate change,

increased by 33per cent worldwide, and, between 2000 and 2013, material extraction in-

creased by 62per cent. This resource- and carbon-intensive model of economic activity has

put pressure on the environment, with the result that economic activity today is unsustainable.

Some 23 countries have decoupled economic growth from GHG emissions as a result of the

increased use of renewable energy, carbon pricing, green product subsidies and green jobs,

among other policies. Environmental sustainability can be achieved alongside the advancement

of decent work.

Some 1.2 billion jobs, or 40per cent of total world employment, most of which are in Africa

and Asia and the Pacic, depend directly on ecosystem services, and jobs everywhere are

dependent on a stableenvironment. Every year, on average, natural disasters caused or ex-

acerbated by humanity result in the loss of 23million working-life years, or the equivalent

of 0.8per cent of a year’s work. Even in a scenario of effective climate change mitigation,

temperature increases resulting from climate change will lead to the loss of the equivalent of

72million full-time jobs by 2030 due to heat stress. Developing countries and the most vul-

nerable population groups are most exposed to these impacts.

Global and local environmental degradation threaten jobs and worsen working conditions,

especially in developing countries and among women and the world’s most vulnerable people

(including migrant workers, people in poverty and indigenous and tribal peoples), making en-

vironmental sustainability an issue of social justice.

Because many industries bring adverse spillover effects on ecosystem services, it is necessary

to ask whether jobs that produce negative externalities and affect other workers can in fact be

considered decent jobs.

Environmental

sustainability

and decent work

8 World Employment and Social Outlook 2018 – Greening with jobs

Introduction

In recent decades, humanity has increased its pressure on the environment. Already by the 1970s, the

world was using more resources than could be regenerated by nature and producing more waste and

emitting more greenhouse gases (GHG) than could be absorbed by the ecosystem (Global Footprint

Network, 2017). This trend has intensied. As a result of population growth and carbon- and re-

source-intensive economic activities, current development models and economic activity have led

humanity towards environmental unsustainability. Humanity is using tomorrow’s resources to satisfy

today’s production and consumption needs (UNEP, 2011).

This chapter shows how environmental degradation (e.g. GHG emissions and the resulting climate

change, natural resource scarcity, air and water pollution, soil degradation, biodiversity loss, changes

in biochemical ows and other environmental challenges) directly and negatively affects the world of

work. Overall, the report demonstrates the urgency of achieving environmental sustainability and shows

that the path towards sustainability is compatible with improvements in decent work, much like other

drivers of the future of work, such as new technologies, alternative business models and globalization

(ILO, 2017a). The chapter further argues that, from the perspective of the world of work, achieving

environmental sustainability is a question of social justice as women and the most vulnerable people in

the world–migrant workers, youth, persons with disabilities, people in poverty, indigenous and tribal

peoples and other vulnerable population groups, depending on the country and region–are particularly

exposed to the risks and damages associated with environmental degradation, despite contributing to

it the least. It asks whether work that degrades the environment and harms other workers’ rights and

productivity can be considered decent work.

Economic activity and jobs rely on environmental resources, a stableenvironment and ecosystem ser-

vices (e.g. water purication, climate regulation, pollination, etc.). Climate change and other forms of

environmental degradation therefore place economic activity and jobs at risk and are a direct obstacle

to achieving full employment that is both productive and decent. Importantly, progress towards decent

work is compatible with progress towards environmental sustainability.

After outlining the current link between economic growth and emissions and resource use, this chapter

shows that some countries have been able to “decouple”, that is, to grow without putting additional

pressure on the environment, and that advancing towards decent work does not limit progress towards

environmental sustainability. In a third section, it demonstrates how jobs depend on a stableand sus-

tainable environment, making the case that environmental sustainability is fundamental to the achieve-

ment of decent work. Overall, the chapter highlights the urgency of the transition to environmental

sustainability from the perspective of the world of work. It sets the stage to examine how the transition

to an environmentally sustainable economy impacts the economy and the world of work (Chapter2)

and review the policies to promote a just transition, which also promote social inclusion and decent

work (Chapters3, 4 and 5). A glossary is available after Chapter5.

1. Environmental sustainability and decent work 9

A. Economic growth, decent work

and environmental degradation

Economic growth has taken place in conjunction with improvements in decent work

In the right policy and institutional context, economic growth can be a major driver for the attainment

of decent work, or, in other words, work that is productive, delivers a fair income, offers security in the

workplace and social protection for families, contributes to personal development and social integration,

grants people the freedom to express their concerns, organize and participate in the decisions that

affect their lives, and ensures equality of opportunity and treatment for all women and men.

The past decades have seen improvements in decent work. Between 1999 and 2015, global GDP

(in purchasing power parity (PPP) and constant 2011 US$ ) grew by almost 80per cent (World

Bank, 2017a),

and real monthly wages increased by 42per cent on average across the world (ILO,

2016a). In low-income countries, the share of people in employment living in extreme poverty (below

US$ 1.90PPP per day) fell from more than 64per cent to 38per cent. It fell from 41 to 15per cent

in lower middle-income countries and from 24 to 3.7per cent in upper middle-income countries (ILO,

2015b). Although child labour remains common in certain regions, it fell from 16 to 11per cent globally

between 2000 and 2012 (ILO, 2013). Even though women remain under-represented in the labour

force, employment and decent work, certain gender gaps have narrowed in developing and developed

countries, particularly in terms of labour force participation (ILO, 2018b). But certain decits remain

and, in the past few years, progress towards decent work has not kept up with economic growth, as

wage growth has stagnated and, by and large, inequality is rising (ILO, 2016a and 2018a).

Economic growth has increased pressures on the environment to an unsustainable level

As countries develop and populations grow, they tend to need more resources, given that develop-

ment relies on the extraction of resources, manufacturing, consumption and the generation of waste

(Global Footprint Network, 2017; Steinberger etal., 2012). This process accelerated sharply after the

1950s (Steffen, Broadgate etal., 2015), and takes place in a context of limited and scarce resources.

There are limits to economic growth that is based on natural resource extraction and waste generation

(Meadows etal., 1972), but, as this chapter shows, there is the possibility to decouple growth and

human development from emissions and resource use.

In 2013, the latest year for which data are available, humanity used and produced 1.7 times as much

resources and waste as the biosphere was able to regenerate and absorb. It now takes the Earth

18months to regenerate what humanity uses in a year (Global Footprint Network, 2017). Seen from an-

other perspective, nine planetary boundaries dene the Earth system’s ability to remain stable.

At least

three of these boundaries have recently been crossed, which will produce irreversible and abrupt envir-

onmental change on a global scale: the addition of nitrogen and phosphorus into water and terrestrial

systems, biodiversity loss and GHG emissions (Rockström etal., 2009; Steffen, Richardson etal., 2015).

Economic activity and development remain coupled to emissions and resource use

Economic activity, economic growth, consumption and development rely, to a larger or lesser extent,

on nite natural resources and energy services, which are often linked to GHG emissions

and other

forms of environmental degradation (Dorling, 2017; IPCC, 2013 and 2014a; Ocampo etal., 2009;

1. Over the same period, GDP per capita grew by 48per cent and the population increased by 22per cent.

2. The nine planetary boundaries are, in no particular order: (1)biosphere integrity (biodiversity loss and extinctions); (2)climate

change; (3)chemical pollution and the release of novel entities (e.g. the release of synthetic organic pollutants, heavy metal

compounds and radioactive material); (4) stratospheric ozone depletion; (5) atmospheric aerosol loading (air pollution); (6) ocean

acidication; (7) biogeochemical ows (nitrogen and phosphorus ows to the biosphere and oceans); (8) freshwater use; and

(9)land-system change (Rockström etal., 2009; Steffen, Broadgate etal., 2015).

3. Carbon dioxide (CO

) is the largest contributor to greenhouse gases (GHGs) which, in turn, are responsible for climate change.

Other GHGs include methane, nitrous oxides and F-gases (HFCs, PFCs and SF6). For the purposes of simplicity, non-CO

GHGs

are converted to a CO

-equivalence based on their global warming potential (GWP). For example, nitrous oxide (N

O), emitted

during agricultural and industrial activities, has a GWP of 298 times that of CO

. F-gases, commonly used as refrigerants or re

suppressants, and in various industrial processes, have a GWP ranging from 124 for some specic hydrouorocarbons, to 22,800

for sulphur hexauoride. This report uses the broad terms carbon-based economy and carbon intensity to refer to the reliance of

economic activity on GHG emissions more generally.

10 World Employment and Social Outlook 2018 – Greening with jobs

Steffen, Broadgate etal., 2015; Steffen, Richardson etal., 2015). GHG emissions are unevenly distrib-

uted across regions due to their relative size and their reliance on GHG emissions for economic pro-

duction (an economy’s carbon intensity). The bulk of emissions in 2012 came from China, the United

States, European Union, India, Brazil and the Russian Federation, which together accounted for almost

60per cent of worldwide GHG emissions (PBL, 2016). G20 countries alone account for over 70per

cent of global emissions (World Bank, 2017a). A quarter of GHGs are emitted by electricity and heat

production. Another quarter can be traced to agriculture, forestry and other land use, with a strong

contribution from forest conversion. Economic and population growth are currently the most important

drivers of increases in GHGs, with the share attributableto economic growth increasing over the past

decades (IPCC, 2014a).

As a result of trade, since goods are not necessarily consumed where they are produced (see box1.1),

consumption- and production-based emissions and resource use differ. This section focuses on ter-

ritorial (production-based) emissions and use as they relate to the economic activity of specic coun-

tries and are associated with the jobs in an economy. International agreements, such as the Paris

Agreement, and cap-and-trade schemes, such as the European Union Emissions Trading Scheme,

are also based on territorial emissions.

Figure 1.1 compares the rise in GHG emissions with economic growth across regions between 1995

and 2014. Of the 180 countries for which data are available, 165 saw GDP per capita grow between

1995 and 2014. Of these, almost three-quarters (72per cent) saw GHG emissions rise alongside GDP

per capita (countries in the upper right quadrants). In most regions, and particularly in Africa, Asia and

the Pacic and most countries in the Americas, economic growth remains coupled with GHG emissions

(the same is also true, although not shown, for material extraction, water and land use).

A country’s emissions and resource use

can be described in two different ways: ter-

ritorial emissions and resource or material

use (production based), on the one hand,

and its carbon, resource or material foot-

print, on the other (consumption based).

Territorial emissions or resources used are

those needed to produce goods and ser-

vices within the economy. In contrast, the

footprint includes all the emissions and

resources embodied in consumption, in-

cluding those associated with imported

goods and services, as well as the goods

and services produced and consumed in

the country, but not those that are exported.

In a closed economy, territorial emissions

and use and the footprint are identical. In

an open economy, however, they differ,

because carbon-, resource-intensive and

hazardous production is moved away from

where goods are consumed. From a foot-

print perspective, for example, GHG emis-

sions have increased in some European

countries, but their production-based

emissions have declined (or grown more

slowly) as a result of carbon-intensive

production being relocated to Asia and the

Pacic. For fossil fuel exporters, produc-

tion-based emissions understate the extent

to which development has been based on

an unsustainable use of fossil fuels (Peters,

Davis and Andrew, 2012; Steinberger

etal., 2012; Tukker etal., 2014; Wiebe and

Yamano, 2016).

The situation is similar for the material,

water and land resources embodied in con-

sumption, compared with those used for

the production of goods and services: de-

veloping and emerging countries are usually

net exporters of these resources, while de-

veloped countries are net importers (Tukker

etal., 2014; Wiedmann etal., 2015). This

is also true for biodiversity and hazardous

production processes. Trade is responsible

for at least one-third of biodiversity threats

worldwide, with consumption in Europe,

Japan and the United States driving hu-

man-induced deforestation, overhunting

and climate change, which are threatening

biodiversity in Africa, Latin America and

South-East Asia, among others (Moran and

Kanemoto, 2017).

Consumption- and production-based emissions and resource use: The role of trade

Box 1.1

1. Environmental sustainability and decent work 11

Africa

Average percentage change in GDP per capita

Average percentage change in GHG emissions per capita

–5 0 5 10 15

–2

1.5

3.0

4.5

6.0

Americas

Average percentage change in GDP per capita

Average percentage change in GHG emissions per capita

–1.5 0 1.5 3.0 4.5 6.0

–1.5

Arab States

Average percentage change in GDP per capita

Average percentage change in GHG emissions per capita

–2 –1 0 1 52 3 4

–3

Asia and the Paciﬁc

Average percentage change in GDP per capita

Average percentage change in GHG emissions per capita

–3 0 3 6

9 12 15 18

–2

Europe and Central Asia

Average percentage change in GHG emissions per capita

–4 –2 0 2

4 6 8 10 12

AGO

BEN

BFA

BDI

CPV

CAF

TCD

COM

COD

COG

CIV

ERI

ETH

GAB

GMB

GIN

GNB

LSO

LBR

MDG

MWI

MLI

MUS

MOZ

NGA

RWA

DZA

CMR

DJI

KEN

MRT

NER

SEN

SYC

ZAF

SDN

SWZ

TZA

TGO

BWA

EGY

GHA

MAR

NAM

STP

SLE

TUN

UGA

ZMB

ZWE

ATG

ARG

BHS

BRB

BLZ

BOL

BRA

CAN

CHL

COL

CRI

DMA

DOM

ECU

SLV

GRD

GTM

GUY

HTI

HND

JAM

MEX

NIC

PAN

PRY

PER

KNA

LCA

VCT

SUR

TTO

USA

URY

VEN

BMU

BHR

IRQ

JOR

KWT

LBN

OMN

QAT

ARE

YEM

AFG

AUS

BGD

BRN

KHM

CHN

FJI

IND

IRN

JPN

KIR

KOR

LAO

MDV

MHL

MNG

MMR

NPL

NZL

PAK

PLW

PNG

SGP

SLB

LKA

TLS

TON

TUV

VUT

VNM

BTN

IDN

MYS

PHL

WSM

THA

HKG

MAC

FSM

ALB

ARM

AZE

BLR

BIH

BGR

HRV

DNK

EST

GEO

IRL

ITA

KAZ

KGZ

LVA

LTU

MDA

MNE

NOR

POL

ROU

RUS

SRB

SVK

TJK

TUR

TKM

UKR

AUT

BEL

CYP

CZE

FIN

FRA

DEU

GRC

HUN

ISL

ISR

LUX

MKD

MLT

NLD

PRT

SVN

ESP

SWE

CHE

GBR

UZB

GDP and GHG emissions growth, 1995–2014 or latest year available

Figure 1.1

Notes: Data for 51 countries in Africa, 34 countries in the Americas, 10 countries in the Arab States, 35 countries in Asia and the Pacic and 50 countries in

Europe and Central Asia. Data for the Central African Republic used in calculations but not shown due to its outlier status (yearly GHG emissions per capita

growth at 55per cent and yearly GDP per capita growth at 19 per cent). The further down and to the right a country is in the gure, the higher are its emissions

associated with each percentage point of GDP growth (i.e. the more the growth is carbon dependent). Vertical scales differ by panel.

Source: ILO calculations based on World Development Indicators.

12 World Employment and Social Outlook 2018 – Greening with jobs

Although of key global importance due to their relationship with climate change, GHG emissions are

not the only source of environmental degradation caused by a carbon- and resource-intensive develop-

ment model and economic activity. In 2013, the world economy extracted 84.4 gigatons of materials,

62per cent more than in 2000, with the highest volume of extraction in Asia and the Pacic (55per

cent of total world extraction in 2013) and the Americas (20per cent) (see gure1.2). As regards total

water extraction, gure1.2 shows that Asia and the Pacic uses more than 55per cent of the world’s

freshwater resources and almost a third of the world’s land. Both freshwater and land resources are

used, to a great extent, by the agriculture sector. These resources are not innite and economies that

rely on them may soon face limits to growth as a result of resource depletion.

GHG emissions

Gigatons (world scale)

Gigatons (regional scale)

100

Material extraction

Gigatons (world scale)

Gigatons (regional scale)

800

1600

2400

3200

4000

Freshwater withdrawals

Billion cubic metres (world scale)

Billion cubic meters (regional scale)

400

800

1200

1600

2000

1500

3000

4500

6000

7500

Land use

Million hectares (world scale)

Million hectares (regional scale)

400

800

1200

1600

2000

Arable land

Permanent crops

Permanent meadows and pastures

Production forest

World

2000

2014

2000

2014

2000

2014

2000

2014

2000

2014

AS = Arab States

AF = Africa

ECA = Europe and Central Asia

ECA

AM = Americas

AM AP

AS AF ECA AM AP

World AS AF ECA AM AP

AS AF ECA AM AP

AP = Asia and the Paciﬁc

2000

2012

2000

2013

2002

2014

0 0

Total GHG emissions, materials and resource extraction and land use, 2000–14 or latest year available

Figure 1.2

Source: ILO calculations based on World Development Indicators (GHG emissions and freshwater withdrawals),

FAOStat (land use) and Material Flows Data (material extraction).

1. Environmental sustainability and decent work 13

Decoupling growth from emissions and resource use is possible

GHG emissions, and resource use in general, do not need to be linked to economic growth; or, in other

words, economic growth can be decoupled from both emissions and material and resource use. There

are two levels at which countries/regions can decouple: absolute and relative decoupling. While relative

decoupling involves economies growing faster than their emissions or material/resource use, absolute

decoupling allows for economies to grow without increasing environmental pressure, or even reducing

it. An environmentally sustainable economy is absolutely decoupled at the global level. Relative or ab-

solute decoupling at the national level may not guarantee progress towards global decoupling because

they can be achieved by the relocation of production, as noted in box1.1 (Ward etal., 2016).

There is evidence of only relative decoupling at the global scale (gure1.3). Between 1995 and 2015,

the world became less dependent on emissions and resource use to generate each unit of GDP (i.e.the

carbon intensity of world output has fallen, but total emissions continued to grow). This has been

theresult of growth in the service sector as well as gains in energy and resource efciency.

There is also evidence of decoupling at the national level. Figure 1.4 shows the countries from gure1.1

that experienced growth in per capita GDP with a reduction in territorial per capita GHG emissions

between 1995 and 2014. Yet not all countries that reduced their territorial emissions can be said to

have decoupled if, for example, they relocated carbon-intensive production to other countries. Of

the 41countries that experienced GDP growth and a reduction of their production-based emissions,

23countries (marked in green) did so with a reduction in their carbon footprint. These countries

achieved an absolute reduction in both production- and consumption-based emissions.

It can there-

fore be said that these countries decoupled their emissions from GDP.

4. Ward etal. (2016) point out the difculty of decoupling GDP growth from environmental impacts and question whether GDP

growth should be a societal goal in itself, as it is a poor proxy for well-being. The objective should not therefore be to decouple

GDP growth from material and resource use and emissions, but to decouple well-being. Decoupling well-being is a more apt and

possible objective, as shown for example by the relationship between emissions and life expectancy (Steinberger etal., 2012), or

between inequality and emissions (Dorling, 2017; Piketty and Chancel, 2015).

5. The countries that decoupled economic growth from both production-based and consumption-based emissions are Azerbaijan,

Bulgaria, Cyprus, Denmark, Finland, France, Germany, Hungary, Ireland, Italy, Malta, Republic of Moldova, Poland, Romania,

Serbia, Spain, Suriname, Sweden, Switzerland, Ukraine, the United Kingdom, the United States and Uzbekistan.

6. This analysis only focuses on decoupling GHG emissions from growth. It takes into account GHG emissions and the corres-

ponding carbon footprint but does not necessarily include other sources of environmental degradation (such as unsustainable

freshwater extraction, land use change or resource extraction).

100

125

150

175

Total

Percentage, base year 2000 = 100

100

125

150

175

Per capita

Percentage, base year 2000 = 100

75 75

1995

1996

1997

1998

1999

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

2010

2011

2012

2013

2014

1995

1996

1997

1998

1999

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

2010

2011

2012

2013

2014

GDP per capita (PPP, US$2011)

GHG per capita (CO

equivalent)

GDP total (PPP, US$2011)

GHG total (CO

equivalent)

Global GDP and GHG emissions, 1995–2015

Figure 1.3

Note: Base year 2000 = 100.

Source: ILO calculations based on World Development Indicators.

14 World Employment and Social Outlook 2018 – Greening with jobs

Denmark is a clear example of decoupling. It achieved average annual GDP growth of 0.9per cent

between 1995 and 2013, with an average annual GHG emissions and carbon footprint reduction of

3.0and 2.8per cent, respectively. This was largely due to the growth of renewables in its energy mix.

By 2015, renewable energy sources accounted for 56per cent of its domestic electricity supply (DEA,

2017). Germany also shows signs of decoupling, with average annual GDP growth of 1.3per cent and

a reduction of both GHG emissions and the carbon footprint at an average annual rate of 0.6per cent,

over the same period. Decoupling in Germany has been driven by the substantial growth in environ-

mental goods and services (i.e. green jobs) (OECD, 2012) and in the use of renewable energy, notably

wind energy (WindEurope, 2017).

At the industry level, there are options for economies to decouple in absolute terms. For example,

the production of electrical energy is carbon intensive in countries that rely on coal or natural gas as

their source of energy, and less intensive in countries that rely on renewables or non-fossil fuel energy

sources. Algeria, Bangladesh, Israel, South Africa, United Arab Emirates and many other countries

rely on fossil fuels for over 95per cent of electricity production. India is rapidly increasing its share of

renewable energy sources but still relies on coal, oil and natural gas and the related carbon emissions

for 80per cent of its electricity. In 2013, more than 80 countries relied on fossil fuels for over 50per

cent of their electrical energy. Albania, Ethiopia and Paraguay, thanks to their hydroelectric capacity,

and Iceland, thanks to its geothermal activity, rely on carbon emissions for less than 1per cent of their

electricity generation (IEA, 2016).

–3

–2

–1

Production-based GHG emissions

(average annual percentage change)

Consumption-based carbon foorprint (average annual percentage change)

–8 –6 –4 –2 0 2 4 6

–4

AZE

BGR

CYP

DNK

FIN

FRA

DEU

HUN

IRL

ITA

MLT

MDA

POL

ROM

SRB

ESP

SUR

SWE

CHE

UKR

GBR

USA

UZB

BEL

BLZ

CAN

CZE

GRC

ISL

ISR

JOR

LVA

LTU

LUX

MKD

MWI

NLD

PLW

PRT

QAT

RWA

Decoupled production and consumption

Decoupled production only

Decoupling of production and consumption-based emissions, 1995–2013

Figure 1.4

Notes: Only the 41 countries from gure 1.1 that experienced GDP growth between 1995 and 2013 and a decline in per capita

GHG emissions over that period are shown. Countries in green experienced growth in GDP per capita, a fall in per capita GHG

emissions and a decline in their per capita carbon footprint. See Appendix 1.1 for methodological details.

Source: ILO calculations based on World Development Indicators (GDP, GHG emissions) and Global Footprint Network National

Footprint Accounts (carbon footprint).

1. Environmental sustainability and decent work 15

B. The relationship between progress towards

environmental sustainability and progress

towards decent work

Despite some evidence of decoupling, economic growth remains coupled to material resource extrac-

tion, water use and GHG emissions for the majority of countries. But this is not necessarily the case

for human development and well-being. For example, improvements in life expectancy are related to

higher emissions only to a certain extent (up to a GDP of around US$ 12,000), after which they de-

couple (Steinberger etal., 2012). Nor is it the case, as this section sets out to show, for improvements

in decent work. Environmental sustainability can be compatible with decent work, especially when

the institutional and policy tools adopted to promote decent work complement measures to advance a

sustainable, low-carbon and resource-efcient economy.

Certain countries have been able to improve labour market outcomes while decoupling growth and

emissions. Comparing the set of countries with GHG-coupled growth and those with GHG-decoupled

growth, the data suggest that both sets improved certain labour market outcomes between 1995 and

2014 by similar proportions (gure1.5). For instance, the group of countries that decoupled growth

between 1995 and 2014 reduced working poverty

by an annual average of 4.6per cent, while the

group of countries in which growth was coupled with a rise in GHG emissions reduced working poverty

by an average of 3.7per cent annually. Similarly, increases in female labour participation and reduc-

tions in self-employment are observed irrespective of the degree to which their economic growth is

coupled to GHG emissions. Mirroring the global trend, the labour share of income fell in all groups of

countries, although it declined more slowly in countries that decoupled both production- and consump-

tion-based emissions. Regression models in table1.1 estimate the extent to which GHG emissions

and labour market outcomes are driven by economic growth and evaluate the statistical signicance

of the relationships.

7. Working poverty measures the share of workers living in extreme or moderate poverty, that is, on less than US$ 3.10 PPP a day.

–3

–4

–2

–1

Average annual percentage change

–5

Working poverty Labour share

of income

Female labour force

participation

Employment-to-

population ratio

Self-employment

Coupled GDP growth with GHG emissions

Decoupled production only

Decoupled production and consumption

Changes in labour market outcomes for coupled and decoupled countries, 1995–2014

Figure 1.5

Notes: Calculations include only countries that experienced GDP growth over 1995–2014 (157 countries out of a total of

182countries for which data are available) and countries for which data are available for the respective indicator (working

poverty: 109; labour share of income: 117; female labour force participation: 157; employment-to-population ratio: 157; self-em-

ployment: 157). Results for the change in working poverty in countries that decoupled production and consumption-based

emissions are not shown because working poverty data are available for only six countries in this group.

Source: ILO calculations based on World Development Indicators, Global Footprint Network 2017 National Footprint Accounts,

Penn World Tables and ILOStat.

16 World Employment and Social Outlook 2018 – Greening with jobs

Table 1.1 summarizes the results of regression models that estimate the relationship between GHG

emissions and these labour market outcomes, controlling for GDP growth, energy intensity and urban-

ization, as it is not clear from gure1.5 whether labour market outcomes are driven by GDP growth,

explaining the change in GHG emissions and labour market outcomes independently. The models es-

timate, rst, the direct relationship between labour market outcomes and GHG emissions (the marginal

model), and, second, the relationship after accounting for GDP, energy intensity and other relevant

indicators (the conditional model).

Improvements in working poverty are associated with higher GHG emissions (marginal model), but

this is mainly due to the fact that GDP growth helps to reduce working poverty and, independently, is

usually coupled with GHG emissions (conditional model). In other words, improving working poverty

only has a weak relationship with higher GHG emissions. The same is true for self-employment. After

controlling for GDP and population growth and energy intensity, reductions in self-employment are not

related to higher GHG emissions. Countries in which female labour participation rates improved and

the labour share increased between 1995 and 2014 tended to see reductions in GHG emissions. This

remains the case after controlling for GDP growth, energy intensity and urban population, but is unlikely

to be a direct effect. Growth in female labour participation and labour share is usually associated with

sectors with low emissions or less productive sectors (e.g. certain service sub-sectors). Similarly, growth

in the employment-to-population ratio is not related to higher GHG emissions. This is because when

GDP growth is driven by growth in services or agriculture, it is associated with lower emissions when

compared to GDP employment growth driven by the manufacturing sector. Indeed, as examined further

in Chapter2, employment creation can be achieved independently of GHG emissions, or as a result of

specic efforts to reduce GHG emissions vis-à-vis the business-as-usual scenario.

In summary, table1.1 shows that the promotion of positive labour market outcomes and certain as-

pects of decent work is to a large extent conditional on economic growth. When growth is decoupled

from emissions it can promote employment in low-emission sectors, promoting labour market out-

comes and decent work. The promotion of decent work is compatible with environmental sustainability,

particularly when economic growth and the specic sectors that promote decent work, are decoupled

from environmental degradation. This requires growth in specic sectors, but also adequate labour

market and environmental regulation and institutions, including full compliance with trade union rights

(Chapters3, 4 and 5).

Labour market outcomes and GHG emissions

Labour market outcome Marginal Conditional Possible explanation

Working poverty –0.703*** –0.185*** A large part of the negative relationship observed

between working poverty and GHG emissions is

explained by GDP growth and energy intensity

Labour share of income –0.302*** –0.036 Any negative relationship observed between labour

share of income and GHG emissions is explained by

GDP growth and energy intensity

Female labour participation rate –2.072*** –0.724*** Growth in the female labour participation rate is

associated with a reduction in GHG emissions,

possibly due to the fact that female participation is

usually associated with growth in less GHG-intensive

sectors

Employment-to-population ratio –1.798*** –0.174 Growth in employment, net of GDP growth and energy

intensity, is not associated with GHG emissions

Self-employment –1.601*** 0.094 Any negative relationship observed between

self-employment and GHG emissions is explained by

GDP, population and energy intensity

Notes: A marginal and conditional time series (1995–2014) regression is estimated for each decent work indicator. All regression

models consider yearly log-GHG emissions per capita as the dependent variable and the labour market outcome as the independent

variable. All models include country and year xed effects. The marginal model only includes the relationship between each decent

work indicator and log-GHG emissions per capita. The conditional model adds controls for log-GDP per capita, log-population,

log-energy intensity and the share of the urban population. Appendix 1.2 provides methodological details and full regression results.

* p < 0.05, ** p < 0.01, *** p < 0.001.

Source: ILO calculations based on World Development Indicators, Global Footprint Network 2017 National Footprint Accounts, Penn

World Tables and ILOStat.

Table 1.1

1. Environmental sustainability and decent work 17

C. The tight link between jobs and the environment

The previous section described how economic activity relies to a large extent on resources and GHG

emissions. It showed that progress towards decent work does not limit progress towards environmental

sustainability. Yet the relationship between work and the environment is more fundamental and can be

thought about in terms of ve different channels.

First, jobs in many sectors (e.g. agriculture, mining and fossil fuel-based energy) rely on natural re-

sources and GHG emissions directly, while other sectors, by virtue of economic linkages, rely on them

indirectly. These jobs are thus coupled to resource use and GHG emissions. They are threatened by the

increasing scarcity of natural resources and by the limits of the Earth’s capacity to absorb the related

waste and emissions. Second, directly and indirectly, jobs rely on the services that ecosystems provide

free of charge (ecosystem services), e.g. jobs in agriculture, sheries, forestry and tourism. Third, jobs

and the quality of work also rely on the absence of environmental hazards (such as storms and air

pollution) and the maintenance of environmental stability (e.g. temperatures within a particular range

and predictableprecipitation patterns). Fourth, to a certain extent, decent work decits can create

conditions that contribute to environmental degradation (for example, overgrazing and overexploitation

could compensate for food, energy or income insecurity). Finally, the risks and hazards associated with

environmental degradation tend to affect women and vulnerable workers the most, including migrant

workers, people in poverty, indigenous and tribal peoples and other disadvantaged groups, depending

on the country or region, thereby generating, exacerbating and perpetuating inequality.

This section describes these channels and ends by asking whether jobs that contribute to environ-

mental degradation undermine social justice.

Through general economic activity, jobs rely on environmental

resources and the capacity of the environment to absorb waste

The relationship between economic activity and emissions and resource use can be extended to

employment. Across the world, at the aggregate level, employment remains coupled to GHG emissions

and material extraction, as the decoupling of employment and resources has been achieved in only a

minority of countries and has not yet been realized at the global level. The carbon and resource inten-

sity of employment demonstrate the extent to which jobs in a particular country or region are reliant on

GHG emissions, material and water extraction and land use.

Figure 1.6 shows how regions sustain jobs with different levels of GHG emissions, material extraction,

and water and land use. In the Americas, jobs are more dependent on GHG emissions and resource

use than in Asia and the Pacic and Africa, to a large extent mirroring the higher labour productivity

in the Americas and the size of the subsistence sector in Asia and the Pacic and Africa. In the Arab

States, jobs are more dependent on GHG emissions because of the importance of the oil industry.

Importantly, the global economy relied more heavily on GHG emissions and material extraction to sus-

tain jobs in 2014 than in 2000, a trend driven mainly by Asia and the Pacic which increased its level of

GHG emissions between 2000 (black dot) and 2012 (green bar). Aggregate gures are economy-wide,

but the employment implications differ by economic sector. The analysis in Chapter2 goes further

and explores the relationship between employment and environmentally sustainable activity, showing

how environmentally sustainable growth may in practice create more jobs, though with a reallocation

across industries.

18 World Employment and Social Outlook 2018 – Greening with jobs

Employment in energy, agriculture, manufacturing and mining

is more reliant on greenhouse gas emissions and resource extraction

The path towards environmental sustainability puts pressure on current modes of production. Sectors

that emit more GHGs or extract more materials will need to transform to lead the transition to a green

economy. Sectors that rely on carbon-intensive and material-intensive inputs as well as on a large

number of workers can also lead the transformation to achieve decent work for all.

In line with an earlier ILO study (ILO, 2012), gure1.7 shows that mining and quarrying, and to a lesser

extent transport and resource-intensive manufacturing, have a high level of emissions and resource

use, but employ a relatively small share of workers. The transition in these sectors will affect a com-

paratively lower share of workers, who will still require support in case of displacement. In agriculture,

the average emissions per person employed are relatively small in view of the high numbers working in

the sector. Agriculture employs around 1 billion workers, often without decent conditions of work (ILO,

2016d). Aggregating the environmental impact per worker to the whole sector means that agriculture is

an important contributor to both GHG emissions and materials extraction. A transition to sustainability

in agriculture will impact the work of many workers, requiring close attention to the evolution of decent

work in the sector during the transition. The service sector is a weak contributor of emissions per

person employed, but it is a relevant contributor to GHG emissions given its large size. Other sectors

that employ large numbers of workers, as discussed in Chapter2, seem under-represented in gure1.7

GHG emissions

Tons of CO

equivalent per worker

Material extraction

Tons per worker

1500

3000

4500

6000

Freshwater withdrawals

Cubic metres per worker

30 000

60 000

90 000

120 000

Land use

Square metres per worker

World

AS = Arab StatesAF = Africa ECA = Europe and Central AsiaAM = Americas

ASAP ECA AMAF WorldASAF ECA AMAP

WorldASAF ECA AMAP WorldASAP AM ECAAF

AP = Asia and the Paciﬁc

2000

2012

2000

2013

2000

2014

2000

2014

0 0

Carbon and resource intensity of employment, 2000–14 or latest year available

Figure 1.6

Note: See Appendix 1.3 for methodological details.

Source: ILO calculations based on ILOStat (employment), World Development Indicators (GHG emissions and freshwater withdrawals),

FAOStat (land use) and Material Flows Data (material extraction).

1. Environmental sustainability and decent work 19

because the gureshows direct GHG emissions and resource extraction, but does not consider their

indirect reliance on material resources (e.g. construction), indirect impact on employment (e.g. energy),

or because they rely more heavily on land (e.g. forestry and agriculture) and water (e.g. agriculture

and sheries).

Some 1.2 billion jobs depend directly on ecosystem services

A second channel by which jobs relate to the environment is through ecosystem services. Ecosystems

provide services to economies, societies and individuals through natural processes.

For example, dry-

land farming relies on rain for irrigation and farmers rely on forests to prevent oods; farmers also rely

on the capacity of the soil to maintain and renew its nutrients. Coastal shing relies on the biodiversity

of the ocean and its capacity to renew sh stocks, as well as on tidal marshes, mangroves and/or coral

reefs for storm protection. These ecosystem services also include, among others, the purication of

air and water, the pollination of crops, the control of agricultural pests, the moderation of temperature

extremes, protection against storms, oods and wind, and support for diverse human cultures and

aesthetic beauty (Daily, 1997).

Ecosystem services provide important, although unrecorded, economic value (Costanza etal., 2014).

They are typically not monetized nor subject to market exchange. Their value and contribution to

human well-being and economic activity are not captured by GDP or market exchanges. In Costa Rica,

for example, the forestry sector contributes 0.1per cent of GDP, as usually calculated from monetary

transactions, but its contribution rises to 2.0per cent when the associated ecosystem services are

taken into account. This is due to forests’ contribution to agriculture and hydroelectric production

(through water ow regulation), tourism (through aesthetic and cultural values) and the pharmaceutical

sector (through biodiversity preservation) (WAVES, 2015). Similarly to any other, the United Kingdom’s

8. The concept of ecosystem services was popularized by the Millennium Ecosystem Assessment (MEA, 2005) and the

Economics of Ecosystems and Biodiversity (TEEB) (Kumar, 2010). The Intergovernmental Science-Policy Platform on Biodiversity

and Ecosystem Services suggests moving beyond the notion of ecosystem services to that of Nature’s Contributions to People

(NCP), considering both the benecial and detrimental contributions of nature and that many NCP may be perceived as benets

or detriments depending on the cultural, socioeconomic, temporal or special context (Diaz etal., 2018).

9. The MEA and TEEB identify four classes of ecosystem services: provisioning services (e.g. food, water, wood for timber and

fuel); regulating services (e.g. water purication, climate regulation); supporting services (e.g. soil formation and nutrient cycling);

and cultural services (e.g. spiritual, cultural and aesthetic uses).

0.1

0.2

0.3

0.4

GHG emissions

Share of total GHG emissions

Share of total employment

0 0.1 0.2 0.3 0.4

0.3

0.6

0.9

Material extraction

Share of total material extraction

Share of total employment

0 0.1 0.2 0.3 0.4

Agriculture

Forestry

Fishing

Mining and quarrying

Food, beverage and tobacco

Textile

Wood, paper

and print

Chemicals, petroleum, nuclear, plastic and fertilizers

Non-metallic products

and machinery

Basic metal and fabricated products

Electricity, gas, steam and air conditioning

Waste management

Construction

Transport

Services

Agriculture

Forestry

Fishing

Mining and quarrying

Food, beverage and tobacco

Textile

Wood, paper and print

Chemicals, petroleum, nuclear, plastic and fertilizers

Non-metallic products and machinery

Basic metal and fabricated products

Electricity, gas, steam and air conditioning

Waste management

Construction

Transport

Service

Employment, GHG emissions and material extraction by sector, 2014

Figure 1.7

Note: Bubble size shows sector’s contribution to GDP.

Source: ILO calculations based on Exiobase v3. For more information on Exiobase, see Appendix 2.1 and Stadler et al., 2018.

20 World Employment and Social Outlook 2018 – Greening with jobs

economy also benets from a variety of ecosystem services; White etal. (2017) estimate that their loss

could have important effects in terms of jobs lost and GDP. Estimates measuring the contribution of

all ecosystem services across the globe in 2011 suggest a value of US$ 124.8 trillion (global GDP in

2011 was estimated at US$ 75.2 trillion) (Costanza etal., 2014). These services are essential for the

economy, and particularly for people in poverty and for indigenous and tribal peoples (see box1.2).

Around 1.2 billion jobs in 2014 were sustained by industries that depend directly or heavily on eco-

system services (table1.2). They account for 40per cent of total world employment. Workers in these

industries depend on ecosystem services to sustain their livelihoods.

The share of employment that relies on ecosystem services varies widely across regions, with Africa

and Asia and the Pacic having the highest share, at 59 and 47per cent, respectively. In Europe and

the Americas, 17per cent of total employment relies directly on ecosystem services, and the gureis

15per cent in the Arab States. Most of these jobs are in agriculture (80per cent), forestry and shing

(5per cent), food, drink and tobacco (6per cent), and the wood and paper, renewable energy, water,

textile, chemical and environment-related tourism sectors (9per cent).

Ecosystem services are particularly relevant

for the world’s poor and for poverty alle-

viation. People in poverty rely more directly

on the provision of ecosystem services for

their livelihoods and well-being. Direct con-

sumption of natural resources sustains liveli-

hoods and prevents households from falling

further into poverty (Suich, Howe and Mace,

2015). For people in poverty, especially

those in rural areas, the environment pro-

vides food and energy. Over 60per cent of

working women in South Asia and sub-Sa-

haran Africa remain in agriculture, which is

often rain fed (ILO, 2016c). Their livelihoods

depend directly on a stableenvironment.

Conserving the environment to ensure

the provision of ecosystem services helps

prevent these households from falling into

extreme poverty or, particularly in drylands

and water-scarce areas, facing the prospect

of displacement. Environmental conserva-

tion and sustainability are therefore a matter

of economic efciency and social justice.

Ecosystem services are particularly bene-

cial for indigenous and tribal peoples, who

are vulnerable to environmental shocks,

as their income, livelihoods and culture

depend on forests and biodiversity. Of the

estimated 370million people belonging to

the world’s indigenous and tribal peoples,

70million depend on forests to meet their

livelihood needs. Although they account for

only 5per cent of the world’s population,

indigenous peoples care for and protect

22per cent of the Earth’s surface and

80per cent of its biodiversity (ILO, 2017b).

Indigenous and tribal peoples can lead en-

vironmental conservation. Their economy,

based on the principles of sustainability,

and their unique knowledge and skills

enable them to make a distinct contribution

to climate action and environmental pro-

tection. Innovation based on traditional

knowledge and practices is already en-

hancing sustainability in the agriculture and

forestry sectors (ibid.). For example, the

deforestation rate in the Brazilian Amazon

between 2000 and 2012 was 0.6per cent

on indigenous lands, compared to 7.0per

cent outside them (Stevens etal., 2014).

In the context of climate change action,

the Local Communities and Indigenous

Peoples Platform of the Subsidiary Body for

Scientic and Technological Advice of the

United Nations Framework Convention on

Climate Change (UNFCCC) recognizes and

further enables the active role of indigenous

and tribal peoples (UNFCCC, 2017a). In

Australia, indigenous Bininj knowledge is

at the core of the West Arnhem Land Fire

Abatement Project which, among other

positive outcomes, has increased the level

of technical skills in the community by

sharing both traditional ecological know-

ledge and Western scientific knowledge

(Huon etal., forthcoming).

Ecosystem services are essential for people in poverty and for indigenous

and tribal peoples, who are key actors in conservation

Box 1.2

1. Environmental sustainability and decent work 21

These estimates consider only employment that is directly dependent on the provision of ecosystem

services. Ecosystem services also support jobs indirectly through other industries that depend on or

provide inputs for these activities (for example, farmers, but not salespeople selling seeds or truckers

transporting produce).

Environmental degradation limits the ability of ecosystems to provide these services, damaging health

and well-being (WHO, 2005) and economic activity (Kumar, 2010) and also putting jobs at risk (GHK,

2007; Rademaekers etal., 2012). For example, climate change affects rain patterns and the economic

activity of farmers; deforestation increases the risk of oods; and intensive, repeated tillage and mo-

no-cultivation of high-value crops reduce soil health and future yields, requiring more fertilizer use,

which may lead to run-off and changing chemical balances in water bodies (eutrophication). Ocean

acidication brought about by climate change affects ecosystems and limits their ability to renew sh

stocks. Changing ocean currents, also due to climate change, modify shery cycles, making stocks

less predictable. Box 1.3 showcases the overexploitation of sheries as an example of how environ-

mental degradation destroys ecosystem services and, by extension communities and jobs throughout

the economy.

Jobs relying on ecosystem services, 2014 (thousands)

Sectors Examples of ecosystem services Africa Americas Asia and

the Pacic

Europe Middle East World

Most activity in the sector is related to biodiversity and ecosystem services

Agriculture Genetic resources and stock

availability, freshwater, pollination,

seed dispersal

217 2 6 3 4 2 6 0 0 6 7 0 47 6 42 1 0 8 4 24 8 9 76 6 9 4

Forestry 1 6 3 4 1 10 3 11 866 2 0 61 36 16 70 0

Fishing 5 11 8 2 2 6 4 3 6 4 91 603 252 4 4 7 2 8

Food, drink

and tobacco

Food, bre and freshwater 3 2 6 7 10 4 7 0 4 6 141 11 0 8 3 510 71 471

Wood and paper Fibre, water purication

and waste control

487 3 6 0 5 7 7 8 9 3 6 9 4 126 15 70 1

Renewable energy Fibre for biofuels 123 292 1 8 4 2 737 107 3 1 01

Water Freshwater supply, recycling,

regulation, purication

and natural hazard regulation

23 136 414 320 57 950

Most activity in the sector relies on biodiversity and ecosystem services, but they do not determine the nature of the sector

Textile Fibre, water purication

and waste control

595 5 4 0 9 3 9 4 2 3 4 2 6 3 165 4 9 8 5 5

Chemicals Genetic resources, biochemical

diversity, freshwater

247 2 25 4 10 9 3 8 1 3 8 8 <0.5 14 8 2 7

Environment-related

tourism

Food, freshwater, air quality,

education, aesthetic

and cultural value

2 282 7 110 2 3 0 8 1 4 8 2 8 357 37 657

Total by region 2 3 1 0 3 9 7 5 2 4 4 8 4 8 4 6 1 71 0 8 4 5 8 5 6 1 2 31 6 8 4

Share of total

regional employment

59% 17% 47% 16% 15% 40%

Note: Only industries in which the activity has a “signicant and substantial” link to the environment are shown. The identication of these linkages is taken

from GHK, 2007. The environment-related tourism sector, following the same source, is estimated as a 0.3 share of the total hotel and restaurant sector.

Sources: ILO calculations based on Exiobase v3; ILO, 2015b; GHK, 2007; and Rademaekers etal., 2012.

Table 1.2

22 World Employment and Social Outlook 2018 – Greening with jobs

Jobs are vulnerable to local environmental risks

Jobs are also vulnerable to the projected increase in environmental risks

which have the potential

to destroy ecosystems and communities, leaving little chance of recovery. This is the third channel

by which jobs and the environment are related. Environmental risks lead to, among others, displace-

ment, migration and increased inequalities (IPCC, 2014b; McLeman, 2011; UNISDR, 2015). Risks can

stem from slow-onset events (as is the case of droughts, erosion, soil degradation or sea level rise) or

rapid-onset events (as is the case of extreme weather events), and can be local or global. Environmental

risks can result from human activity (e.g. water pollution from non-compliant industrial activity) or

natural hazards (e.g. water pollution following a volcanic eruption). Human activity can also increase

10. An environmental risk is the probability and consequences of an event transmitted through the air, water, soil or biological

food chains.

According to the FAO (2016), 31per cent of

sh stocks are overshed and 58per cent

are fully shed. For the majority of collapsed

fisheries, recovery is elusive, even after

15 years, leading to long-term economic

losses (Hutchings, 2000). The percentage

of stocks shed at unsustainable levels has

increased since the 1970s, putting the live-

lihoods of many shers at risk in the short

or medium term.

The livelihoods of some

45.6million workers depend on sh capture

and aquaculture (table1.2).

Two-thirds of

these workers are shers who depend on

wild catch (not aquaculture) (FAO, 2016).

Due to the linkages of the shing industry

with other sectors (shers need fuel and

other inputs and, once caught, wild fish

are processed, distributed and sold to re-

tailers and the food and hotels and res-

taurant sectors, for example), around 2.8

additional jobs in other industries depend

on each fishing sector job (Pauly and

Zeller, 2016). ILO estimates suggest that

if the wild catch shing sector (not aqua-

culture) were to collapse, for example due

to overshing, 85.7million jobs would be

destroyed in total (30.6million in wild catch

sheries and 55.1million in other indus-

tries). Overexploitation of sheries can also

have wider implications for the well-being of

migrant shers and the economies that rely

on their remittances, such as those in the

ASEAN region (ILO, 2014).

The sardine fishery in the Atlantic is

facing an imminent collapse (ICES, 2017).

Asimilar situation was experienced for the

Peruvian anchoveta shery in the 1970s

and for North Atlantic cod in the 1990s

(Pauly etal., 2002). In Newfoundland and

Labrador, Canada, 40,000 shers were left

out of work, and the province lost 10per

cent of its population following the collapse

of the fishery. Expensive relief packages

failed to provide adequate support for these

shers and cod stocks have failed to re-

cover 25 years after the moratorium went

into effect.

The World Bank (2017b) shows how over-

fishing led to US$ 83 billion in losses in

2012, due to lower productivity in the

sector. A reduction in shing can help re-

store fisheries, leading to an increase in

sh biomass in the ocean, higher annual

harvests, higher prices and lower costs, re-

sulting in an overall increase in annual net

benets in the sector. Measures to restore

sheries are particularly urgent in Asia.

Overexploitation is only one of the many

sources of environmental degradation that

threaten productivity in the shing sector.

These include water ows into dams, which

reduce the nutritional intake of sh in river

basins (Zivetal., 2012), changing ocean cur-

rents as a result of climate change, the ac-

cumulation of plastic in oceans, the increase

in nitrogen and potassium run-off from agri-

culture into rivers and lakes and, potentially,

ocean acidification (Steffen, Richardson

etal., 2015), all of which will continue to

affect the distribution and will reduce the

body size of sh (Cheung etal., 2013).

Other estimates argue that capture statistics are usually biased downwards and that total catch may actually be higher

than ofcially reported to governments, due to illegal catch, under- or non-reporting. Estimates that take this bias into

account put total catch at 30–50per cent higher than the ofcially recognized gures in developed countries and over

100per cent higher in developing countries (Pauly and Zeller, 2016).

Estimates that attempt to correct for the lack of detailed ofcial data on sheries and which include indirect employment

suggest much larger gures. Teh and Sumaila (2011) suggest that around 203million full-time equivalent jobs are sus-

tained by global sheries. Roughly 11per cent are small-scale shers.

Overexploitation of sh stocks could destroy 85.7million jobs

Box 1.3

1. Environmental sustainability and decent work 23

the occurrence and intensity of natural hazards (e.g. increasing the intensity and frequency of extreme

weather events as a result of human-induced climate change), and their consequences (for example,

mangrove deforestation increases the consequences of storms on shores) (Whyte and Burton, 1980).

Risks become disasters when they overwhelm local capacity. They destroy jobs, oblige people to move

and slow down economic activity through the destruction of capital stock, delivery and transport sys-

tems and other infrastructure. Although rebuilding capital stock following a disaster may stimulate GDP,

the short- and long-term economic consequences of disasters are negative, particularly for developing

and smaller economies (Felbermayr and Gröschl, 2014; Noy, 2009).

At the local level, for example, human-caused air, water, food chain and soil pollution, biodiversity loss

and natural resource depletion have a direct negative effect on the health of workers and the popu-

lation, productivity and economic activity, and an indirect one in related sectors or geographical areas.

Soil, air and water pollution alone led to 9million deaths in 2015, or over 15 times the deaths related

to armed conict and violence and three times the number of deaths attributed to AIDS, tuberculosis

and malaria combined. Outdoor and household air pollution from industrial activity and fossil-fuel

based transport and power generation, led to 6.5million premature deaths in 2015 (Landrigan etal.,

2018). The detrimental effect of air pollution reduces productivity and working hours through the de-

terioration of the health of workers themselves, and of women in their role as caregivers for dependent

children. Air pollution thus increases gender inequality in the labour market (Montt, 2018). The health

effects of intense air pollution persist in the long term, even ten years after exposure (Kim, Manley

and Radoias, 2017). Taking into account only premature deaths, air pollution costs the world economy

about US$ 225 billion in lost labour income and US$ 5 trillion in welfare losses. The losses are greatest

in East Asia and the Pacic, where they amount to 7.5per cent of GDP, and South Asia, at 7.4per cent

of GDP (World Bank and Institute for Health Metrics and Evaluation, 2016). These economic costs are

an underestimate as they do not take into account the changes in crop yields caused by high concen-

trations of pollutants in the air (OECD, 2016) or lost productivity due to absenteeism.

There are similarly signicant economic, social and welfare costs as a result of soil and water pollu-

tion and soil degradation, desertication and poor land management, which can threaten agricultural

activity, workers’ health and food security (Kneese, 2015; Lu etal., 2015; Utuk and Daniel, 2015);

wildres, which affect economic activity and workers’ health (Richardson, Champ and Loomis, 2012);

oods, which affect property, safety and the economic well-being of communities (Brody etal., 2007);

and food chain pollution, which affects workers’ health and incomes (Bachev and Ito, 2014). To a great

extent, these environmental risks become disasters due to the design and structure of communities

and the resulting interactions with the environment (Mileti, 1999).

Human-induced climate change will increase the impact of natural hazards

on the world of work, leading to job and productivity losses

As a result of climate change and other forms of environmental degradation, projections point towards

an increase in the frequency and intensity of extreme weather events and disasters (IPCC, 2014b). With

each disaster, jobs and productivity are lost. Figure 1.8 shows that between 2000 and 2015, 23million

working-life years were lost annually as a result of different environmentally related hazards caused

or exacerbated by human activity.

Beyond accounts of untold human suffering, this is equivalent to

0.8per cent of a years work, considering that 2.8billion people aged 15 to 64 are in employment in

any given year. Across all regions, Asia and the Pacic and Africa suffered the greatest loss of work-

ing-life years due to human-induced or climate change related disasters between 2008 and 2015,

with an annual average loss of, respectively, 536 and 376 working-life years per 100,000people of

working age. The effects of environment-related hazards increased in the Americas and the Arab States

between the periods 2000–07 and 2008–15.

11. The estimate of working-life years follows Noy’s (2014) estimates for total life years lost due to disasters. Noy’s methodology

is adapted to take into account retirement and the population in employment in each country, as described in Appendix 1.4.

12. The large drop in working-life years lost in Asia and the Pacic during 2008–15 in comparison with 2000–07 is due to the fact

that out of the ve biggest disasters in terms of working-life years lost during the entire 2000–15 period, four occurred between

2000 and 2007: the 2002 drought in India and the 2002, 2003 and 2007 oods in China.

24 World Employment and Social Outlook 2018 – Greening with jobs

Changing weather patterns threaten agricultural incomes and rural jobs

Average temperature rises of over 2°C above late twentieth century levels will, without adaptation, nega-

tively impact maize, wheat, rice, cocoa, coffee and tea yields in tropical and temperate regions,all of

which support the livelihoods ofmillions of farmers (Bhagat, Deb Baruah and Saque, 2010; Bongase,

2017; Bunn etal., 2015; ILO, 2012; IPCC, 2014b; Renteria, 2016; Schroth etal., 2016; Wildenberg

and Sommeregger, 2016).

An average temperature rise of over 4°C will pose serious risks for food

security (IPCC, 2014b). Rainfall is predicted to increase in the tropics and higher latitudes, but to de-

cline in the already dry semi-arid to arid mid-latitudes and in the interior of large continents. Population

growth will also increase the demand for water by at least 40per cent for a constant volume of pro-

duction, exacerbating scarcities expected through climate change. By 2030 nearly half of the world’s

population will live in areas of high water stress; water scarcity will force the displacement of hundreds

ofmillions of people (ibid.). Agriculture relying on run-off from glaciers and snow melt is also expected

to be negatively affected by climate change (FAO, 2011). Areas suitablefor growing crops will move

geographically, but farmers may not be able to act on these changes by migrating or adopting alter-

native or drought-resistant crops, many of which require decades of investment before yields become

protable. These challenges are in addition to those related to overexploitation, chemical run-off and

soil degradation following the injudicious use of the technologies that instigated the productivity gains

in agriculture between the 1960s and 1980s (Pingali, 2012).

The greatest implications will be in rain-fed agriculture, which currently provides around 60per cent

of the world’s agricultural production and covers 96per cent of cultivated land in sub-Saharan Africa,

87per cent in South America and 61per cent in Asia (FAO, 2011), with signicant effects on eco-

nomic growth and development (Brown etal., 2011). A large number of agricultural wage workers are

also migrant workers from poorer countries who provide an important safety net for their communities

back home (ILO, 2016b). Without aggressive adaptation measures (irrigation infrastructure, access to

improved seed varieties, skills development and access to regular migration opportunities), farmers

practising rain-fed agriculture in vulnerable regions could be displaced or have little choice but to

13. Projections suggest a higher likelihood of positive effects on crop yields in northern latitudes (IPCC, 2014b).

250

500

750

1000

By region

Working-life years lost (per 100 000 workers)

500

250

750

1000

By income group

Africa Americas Arab

States

Asia and

the Paciﬁc

Europe and

Central Asia

Low

income

Middle

income

High

income

2000–07 annual average 2008–15 annual average

0 0

Working-life years lost due to disasters, 2000–15

Figure 1.8

Note: The estimates take into consideration casualties, people affected and damages resulting from meteorological (storms, fog, extreme temperature), hy-

drological (oods, landslides, wave action), climatological (drought, glacial lake outburst, wildres), biological (insect infestation) and certain technological

(industrial or miscellaneous accidents) hazards. Estimates do not include casualties, people affected or damages resulting from geophysical (earthquake,

mass movement, volcanic activity), biological (viral, bacterial, parasitic, fungal or prion disease epidemics, animal accidents), extraterrestial (impact, space

weather) or certain technological (transport accidents) hazards. The methods used follow Noy’s (2014) approach, with adjustments for retirement age and

national employment-to-population ratios. Appendix 1.4 provides more details on the methodology applied.

Source: ILO calculations based on Noy, 2014, EM-DAT Disaster Database, Global Health Observatory, United Nations population statistics, World Development

Indicators, World Economic Outlook Database and ILOStat.

1. Environmental sustainability and decent work 25

migrate. Some may be forced to migrate to urban areas, while others may be compelled to cross bor-

ders.

In the absence of safe and regular migration pathways, urban and cross-border movements

can increase the risk of exploitation and abuse.

Climate change acts as a multiplier of the risk of social conict. For example, the displacement, food

insecurity and resource depletion brought about by climate change have been associated with the

humanitarian crisis in the Lake Chad region (Nett and Rüttinger, 2016). The 2007–10 drought in the

Syrian Arab Republic, the worst on record in the country, caused massive crop failures in the national

agricultural heartland. Its severity and the higher probability of other such droughts in the region are the

consequence of human-induced GHG emissions and the resulting climate change. Some 75per cent of

agriculture-dependent households experienced total crop failure from the start of the drought. With the

loss of income from crops, and the resulting need to sell livestock at depressed prices, between2and

3million people fell into extreme poverty and some 1.5million were forced from rural into urban areas,

making the drought a contributing factor to the ongoing conict (Kelley etal., 2015).

In addition to the changes resulting from climate change, agriculture is sensitive to other forms of

environmental degradation, such as oil spills (e.g. in Nigeria) or water scarcity caused by overexploita-

tion of freshwater resources (e.g. in the Colorado River basin in the United States, or in Jordan). As

with the effects of climate change, these effects are disproportionately distributed and have negative

repercussions on rural agricultural workers in terms of employment, productivity and shifts in food and

non-food crops.

Women and the working poor, as well as the population of low-income countries

andSmall Island Developing States are overly exposed to current and future risks

People who are socially, economically, culturally, politically, institutionally, or otherwise marginalized are

especially vulnerable to the effects of climate change and other forms of environmental degradation.

Environmental degradation thus increases inequality, signalling a fourth channel by which jobs and

the environment are related. Groups at risk include populations not covered by national social protec-

tion systems such as migrant workers and workers in the informal economy (IPCC, 2014a). People in

poverty are generally more exposed to hazards and disasters (Hallegatte etal., 2016). Exposure and

vulnerability to environmental risks are not evenly distributed across countries; indeed, 80per cent

of the total life years lost to disasters are spread across low- and middle-income countries (UNISDR,

2015). Poor and low-income countries are at higher risk in view of their lower capacity to mitigate the

damage and mobilize resources for reconstruction (Noy, 2009; Schumacher and Strobl, 2011). For

example, climate change is a direct threat to poverty eradication as a result of changes in ecosystems,

which affect food prices and security, more extreme and more frequent natural hazards and the mag-

nication of health threats, a key source of chronic poverty (Hallegatte etal., 2016). Gender differences

in social and economic roles and responsibilities exacerbate the vulnerability of women, who have lower

access than men to resources to adapt to climate change, including land, credit, agricultural inputs,

decision-making bodies, technology, social insurance and training. For the majority of women working

in the informal economy and in small enterprises, it is particularly difcult to recover from the effects

of environmental disasters (ILO, 2009; IPCC, 2014b).

Recognizing the gendered effects of climate change, a gender action plan was adopted at the

23rdConference of the Parties (COP23) of the United Nations Framework Convention on Climate

Change (UNFCCC). Mindful of the imperative of a just transition, the plan will promote gender-responsive

climate policy by integrating gender considerations into all activities concerning adaptation, mitigation

and related means of implementation (nance, technology development and transfer, and capacity-

building), as well as decision-making in the implementation of climate policies (UNFCCC, 2017b).

Disasters damage lower-income countries the most. Although middle-income countries, in view of their

population size, accounted for the vast majority of working-life years lost to disasters between 2008

and 2015, low-income countries experienced the greatest per capita effects. Between 2008 and 2015,

an average of 629 working-life years were lost per 100,000 people in low-income countries, compared

14. Climate- and environment-induced migration may, to a certain extent, provide sending regions with opportunities associated

with migration, including remittances, which could be used to nance adaptation measures and labour mobility, which can in turn

lead to the acquisition of skills relevant for adaptation and mitigation.

26 World Employment and Social Outlook 2018 – Greening with jobs

with 61 in high-income countries (Noy, 2014, and ILO estimates based on Noy’s interactive data set).

Natural hazards can also cause large-scale disasters in countries with limited nancial buffers against

severe, but infrequent disasters (e.g. Algeria, Chile, Indonesia, Islamic Republic of Iran, Madagascar,

Pakistan and Peru) (UNISDR, 2015).

Small Island Developing States (SIDS) are particularly vulnerable to environmental shocks. They have

a narrow resource base, comparatively remote markets and a limited ability to benet from economies

of scale. Storm surges and sea-level rise will degrade fresh groundwater resources and salinize agri-

cultural land. The fragile land and marine ecosystems of SIDS, and the related economic activities, are

sensitive to invasive alien species, globally emitted contaminants and overexploitation, among other

human-induced risks (IPCC, 2014b; UNEP, 2014). Many of the environmental risks that threaten SIDS

originate outside their borders and directly affect key industries (such as agriculture, sheries and

tourism) and the substantial number of jobs and livelihoods that depend on them (ILO and ADB, 2017).

Over 85per cent of the land of the Cook Islands, Kiribati, Maldives and Marshall Islands, and 26per

cent of all the land of SIDS lies less than 5 metres above sea level, probably forcing displacement (ADB,

2012). In the Caribbean Community, around 30per cent of major resort properties would be partially

or fully inundated by a 1-metre rise in the sea level, affecting a key industry (UN-OHRLLS, 2015).

The annual impact of natural disasters in SIDS represents over 17per cent of their GDP, compared

to 6per cent in lower middle-income countries and 3per cent in high-income countries (OECD and

World Bank, 2016). By way of illustration, Cyclone Pam hit the islands of Vanuatu in 2015, levelling

the housing and transport infrastructure and destroying crops, and the storm surge salinized farming

land. The medium-term impacts on tourism and agriculture undermined economic activity, jobs and

incomes in the islands for several years (ADB, 2015).

Rising temperatures will have a signicant impact

onproductivity and occupational safety and health

Rising temperatures increase the incidence of heat stress and health risks, and the proportion of

working hours during which a worker needs to rest and cool down the body to maintain the core body

temperature below 38°C and avoid heat stroke. During the course of the century, and as a result of

human-induced climate change, many of the more than 4 billion people who live in hot areas will ex-

perience negative health and safety effects and reduced work capacity (Kjellström etal., 2016). Heat

stress is an occupational safety and health (OSH) hazard (ISO, 1989, 2017), as indicated in manuals

produced by OSH agencies around the world, and should be considered a hazard by workers, em-

ployers and governments,

in accordance with the Occupational Safety and Health Convention, 1981

(No.155), and the accompanying Recommendation No.164. Likewise, workers affected by heat stress

should be entitled to remedy benets as prescribed under the Employment Injury Benets Convention,

1964 (No.121).

The growing prevalence of heat stress will reduce worker performance, partly because slowing down

is a natural adaptation to heat exposure. Heat stress will continue to reduce productivity and lead to

negative occupational health effects and workplace injuries, particularly in the countries most exposed

to extreme heat, in sectors that rely on outside and daytime work (e.g. agriculture, construction) and in

areas with weaker adaptation (such as factories without effective cooling systems) (Kovats and Hajat,

2008). In developing countries, the majority of workers suffering from heat stress are not covered by

employment injury insurance. Worldwide, only 34 per cent of persons of working age are covered in

case of an injury at work (ILO, 2017c). Productivity losses are expected in developing and emerging

economies (e.g. Bangladesh and Thailand), as well as some advanced economies (e.g. Australia and

the United States) (Kjellström etal., 2016). Urban areas often experience higher heat levels. Estimates

15. The high vulnerability of SIDS to risks produced elsewhere means that adaptation is a core component of their long-term

economic and social sustainability as, with their small relative size, they can do little to mitigate their occurrence. Several funding

mechanisms exist to build resilience in SIDS. These include the International Development Association, the Adaptation Fund, the

Green Climate Fund, the Global Environment Fund, the Least Developed Countries Fund and the Special Climate Change Fund.

Most of these funds are available to World Bank or IMF members only, excluding the Cook Islands and Cuba from most of these

mechanisms (they also exclude Montserrat and Niue, non-ILO member States) (OECD and World Bank, 2016).

16. See, for example, the heat stress information brochures produced by the Ontario Ministry of Labour (https://www.labour.gov.

on.ca/english/hs/pubs/gl_heat.php), the United Kingdom Health and Safety Executive (http://www.hse.gov.uk/pubns/indg451.htm)

and the United States Occupational Safety and Health Administration (https://www.osha.gov/SLTC/heatstress/).

1. Environmental sustainability and decent work 27

for urban economies suggest that a warm year can result in losses in gross value added between

–0.4per cent (London, United Kingdom) and –9.5per cent (Bilbao, Spain) (Costa etal., 2016), with

even greater estimated losses for urban economies in emerging countries.

Globally, an estimated 1.4per cent of total hours worked were lost in 1995 due to high heat levels

(gure1.9), representing around 35million full-time jobs worldwide. Estimates combining a global

temperature rise of 1.5°C by the end of the twenty-rst century and labour force trends suggest that, by

2030, the percentage of total hours of work lost will rise to 2.0per cent, a productivity loss equivalent

to 72million full-time jobs. This is most likely an underestimate as it assumes a 1.5°C increase in global

mean temperature and assumes that agricultural work is carried out in the shade.

The negative impact of rising temperatures is unevenly distributed across sub-regions. Southern Asia

and Western Africa will be most affected, with productivity losses equivalent to 4.8per cent and 4.6per

cent, corresponding to around 40 and 9million full-time jobs, respectively. In contrast, European

subregions are expected to experience a smaller impact. Agricultural workers will be the worst affected;

they will account for 66per cent of global hours lost due to heat stress in 2030, in view of the phys-

ical nature of their work, which it is undertaken outside, and the fact that a large number of workers

are engaged in agriculture in the areas most affected by future heat stress. Even greater temperature

rises, as predicted under a business-as-usual scenario, will make some of these areas unproductive,

displacing a large number of workers.

17. These results are in line with those of the IMF (2017), which suggest that for a median low-income country, with an average

temperature of 25°C, the effect of a 1°C increase in temperature will reduce annual GDP growth by 1.2percentage points.

Appendix 1.5 provides more details on the methodology used to estimate and project heat stress.

1995

2030

Northern Europe

Western Europe

Eastern Europe

Southern Europe

Central Asia

Southern Africa

Western Asia

Northern America

Paciﬁc Islands

Caribbean

South America

Eastern Africa

Arab States

Eastern Asia

Central America

Northern Africa

World total

Central Africa

South-Eastern Asia

Western Africa

Southern Asia

< 0.1

0.1

0.2

0.3

0.6

0.3

0.5

0.3

0.6

0.3

0.6

0.4

0.8

0.5

0.6

0.8

0.6

1.3

1.4

2.0

1.4

2.7

3.0

3.3

3.9

4.6

4.8

Working hours lost to heat stress under a 1.5°C scenario, 1995–2030

Figure 1.9

Note: Appendix 1.5 provides more details on the methodology applied.

Source: ILO calculations based on ILOStat and HadGEM2-ES and GFDL-ESM2M climate models.

28 World Employment and Social Outlook 2018 – Greening with jobs

Decent work decits can contribute to environmental degradation

As indicated above, environmental degradation limits the possibility of achieving full and productive

employment and decent work. Though the largest part of environmental degradation is the result of

industrial activity, decent work decits can also contribute to environmental degradation to some extent,

especially at the local level, marking the fth way in which the world of work is related to the natural

environment. Decent work decits reect institutional failures, economies in development paths charac-

terized by low diversication, low levels of innovation and high levels of employment in low-productivity

activities as well as market failures, and are a major driver of poverty; all of these interact and can

lead to environmental degradation (Duraiappah, 1998; ILO, 2016d; Nunan,2015). Viewed in simple

terms, decent work decits–through lack of employment, income security and training opportunities

and awareness–contribute to environmental degradation since, when faced with food and energy

insecurity, farmers are tempted to overgraze, overuse land and cut down forests (World Commission

on Environment and Development, 1987). For example, the households of the rural working poor often

lack access to social protection and may have to resort to unsustainable forms of resource extraction

for immediate income generation. In the Apac district in Uganda, rural households frequently cut

down trees to produce charcoal to generate off-farm income. The resulting deforestation reduces the

humidity levels of the soil and agricultural production. As a result, in dry years, farmers expand their

agricultural activities to wetlands, making it more difcult to preserve the local ecosystem and the

related services (Ulrichs and Slater, 2016). Chapter4 explores how policies that protect workers and

households, as is the case of social protection policies, can break this cycle.

In some instances, well-governed labour migration opportunities can provide an alternative source of

income insulated from environmental risk, while reducing population pressure and allowing stressed

land to regenerate. However, in the absence of safe and regular migration pathways, populations may

be compelled to move internally to locations where they perceive greater decent work opportunities.

This often means overcrowded urban centres, already struggling under large volumes of waste, scant

resources and polluted water.

Jobs that contribute to environmental degradation

violate the principle of equal opportunity

The above sections highlight the negative effects of environmental degradation on jobs. Yet many

jobs and economic activities contribute to environmental degradation when the associated resource

extraction and emissions are unsustainable. Given that jobs in specic industries are likely to generate

negative externalities (such as jobs in mining, which can pollute water), it is necessary to trace the

indirect impact on jobs in affected industries (such as shing and farming), to test whether jobs that

generate negative externalities comply with the principles of equality of opportunity and decent work.

At the global level, climate change caused by industrialized countries, and increasingly by emerging

economies, is placing jobs at risk in less developed countries. At the local level, the externality of one

type of job may compromise the ability to pursue decent work in other jobs (gure1.10).

In this context, can jobs which produce negative externalities affecting other workers be considered

decent jobs, and do they threaten equality of opportunity? These questions are not so much about who

has the right to the job (following the previous example, the miner or the sher), but how to ensure

equal opportunity for all.

To a certain extent, this principle is beginning to be acknowledged for workers who have experienced the

negative consequences of environmental degradation. For example, the possibility of allowing vulnerable

workers from developing regions to access foreign labour markets as a means of reparation is being consid-

ered in the UNFCCC Warsaw International Mechanisms Task Force on Displacement, as an issue related

to “loss and damage” stemming from climate change. An environmentally sustainable economy guaran-

tees that negative environmental externalities are limited, suggesting that environmental sustainability is

an issue of social justice. Also, a just transition, as outlined by the Guidelines to a just transition to environ-

mentally sustainable economies and societies for all (ILO, 2015a), guarantees protection to workers who

may be damaged by environmental degradation and by phasing-out or adaptation of certain industries.

18. The Declaration concerning the aims and purposes of the International Labour Organisation (Declaration of Philadelphia),

adopted in 1944, states that “all human beings, irrespective of race, creed or sex, have the right to pursue both their material

well-being and their spiritual development in conditions of freedom and dignity, of economic security and equal opportunity”.

1. Environmental sustainability and decent work 29

Conclusions

Economic development, social protection policies and labour market institutions have brought improve-

ments in decent work in many parts of the world. Current development models and economic activity,

however, threaten environmental stability through climate change, soil degradation, biodiversity loss,

air and water pollution, eutrophication and other forms of environmental degradation. This chapter

has shown the intricate relationship between the environment and the world of work, highlighting how

environmental degradation increases risks from natural hazards and the loss of ecosystem services,

both of which directly affect the number and quality of jobs. Fundamentally, environmental degradation

threatens the achievement of decent work for all.

Some 1.2 billion workers depend on ecosystem services. Workers in agriculture (the majority of whom

are poor) have already begun to suffer from changing rain patterns, natural hazards and higher tem-

peratures resulting from climate change, and lower productivity as a result of poor land management,

overexploitation and desertication. Millions of hours of work have been lost to natural disasters,

andmillions will be lost to higher temperatures. Mitigation (to avert future damage) and adaptation (to

prevent degradation from causing damage) are urgent.

From the perspective of the world of work, environmental sustainability is also an issue of social justice.

Environmental degradation, in its many forms, limits the right of workers to work. It widens inequalities,

as women and the most vulnerable workers (particularly migrants, people in poverty, and indigenous

and tribal peoples) are most affected by environmental degradation. Importantly, this chapter shows

that progress towards decent work is compatible with environmental sustainability.

Building on this analysis, Chapter2 examines the meaning of a transition for economic activity,

employment and some aspects of job quality in the medium term. It explores the role that green enter-

prises and green jobs play in such a transition. The remaining chapters analyse policies that can help

ensure that the transition to an environmentally sustainable economy is just, examining how the regu-

latory framework (Chapter3), income support policies (Chapter4) and skills development (Chapter5)

can lead to more and better jobs. Acknowledging the inequalities associated with environmental deg-

radation and the opportunities to remedy them, Chapters4 and 5 also analyse how social protection

and skills policies take gender into account in policy development.

Negative impact on work

at the local and regional level

Climate change

Unsustainable economic activity

Employment in environmentally degrading activities

Resource depletion Land degradation

Negative impact on work

at the global level

Air, water pollution

Jobs in unsustainable economic activities undermine equal opportunity

Figure 1.10

Source: ILO.

30 World Employment and Social Outlook 2018 – Greening with jobs

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2. Employment in a green economy 37

KEY FINDINGS

To a large extent, advancing towards a green economy creates employment at the global level.

It entails a reallocation of employment across industries, requiring policies to ensure the tran-

sition is just for all.

Compared to the business-as-usual scenario, changes in energy production and use to achieve

the 2°C goal can create around 18million jobs throughout the world economy. These changes

include a shift towards renewable energy sources and greater efciency, the projected adoption

of electric vehicles and construction work to achieve greater energy efciency 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.

Promoting sustainability in agriculture will change rural economies: a shift to conservation

agriculture may shed jobs in the sector but improve the quality of employment therein, while

a shift to organic agriculture may create jobs, though at the expense of increased land use

pressure. The transition in agriculture requires complementary policies to ensure that it is an

opportunity for workers and economies.

The circular economy is a model for sustainability in resource use and consumption. Almost

6million jobs can be created by moving away from an extract-manufacture-use-discard model

and embracing the recycling, reuse, remanufacture, rental and longer durability of goods.

Notably, it means a reallocation from the mining and manufacturing sectors to waste manage-

ment (recycling) and services (repair, rent).

Workers and employers have made signicant contributions to greening the economy through

green jobs and sustainable business practices. However, despite the sound business case for

sustainability, rms’ commitment should be enhanced to achieve environmental sustainability

at the global level.

Employment and

the role of workers

and employers in

a green economy

38 World Employment and Social Outlook 2018 – Greening with jobs

Introduction

Development in a context of environmental sustainability means transitioning towards a green economy,

that is, an economy in which the capacity to satisfy tomorrow’s needs is not limited by today’s resource

use, emissions and waste. A green economy is one that “results in improved human well-being and

social equity, while signicantly reducing environmental risks and ecological scarcities” (UNEP, 2011,

p.2). It is low-carbon, resource-efcient and socially inclusive. It entails environmental sustainability

and decent work. A green economy embodies the Sustainable Development Goals (SDGs) by, among

other means, advancing climate action, protecting life on land and below water, providing affordable

and clean energy and promoting decent work and economic growth.

As indicated in Chapter1, today’s economic reliance on freshwater and materials extraction, land

use, waste and GHG emissions has reached unsustainable levels. In view of the reliance on natural

resources and emissions, the transition to a green economy is akin to an industrial revolution (Bowen,

Duffy and Fankhauser, 2016; Bowen and Kuralbayeva, 2015), offering opportunities and challenges

for labour markets (Esposito etal., 2017). The costs of not supporting the transition can be higher than

the costs of the transition itself, as illustrated by the energy transition (Caldecott, Sartor and Spencer,

2017). The transition to a green economy must be complemented with adequate labour market policies

to ensure a smooth and just transition (ILO, 2015).

As the ILO (2012) points out, a green economy means a more effective use of resources and more

friendly methods of production in the agricultural sector that rely on fewer GHG emissions and do not

bring about deforestation, topsoil degradation or pollution and geochemical imbalances from pesti-

cide and fertilizer run-off. It means sustainable management of forests and sheries to increase their

production capacity while avoiding overexploitation and biodiversity loss, the promotion of reliance

on less carbon-intensive and more renewable energy sources, the increased energy efciency of

buildings and transport, and lower reliance on materials extraction for production. As shown in this

chapter, a low-carbon, resource-efcient economy employs more people, is more labour intensive,

and is at least as productive as an economy with a production model based on high carbon, resource

and material intensity.

This chapter demonstrates that achieving the 2°C goal (i.e. limiting global warming to 2°C above

pre-industrial times over the long term) can create more employment than predicted by the business-

as-usual scenario. Positive results can also be expected from the adoption of certain principles of the

circular economy and the promotion of sustainability in agriculture if the path towards sustainability is

accompanied by policies to support the transition of agriculture workers into other, more productive

sectors. The chapter concludes by highlighting the important role that enterprises and workers play in

guiding and leading the transition.

1. As described in Chapter1, this is due to a shift in value added from resource-based capital gains to workers’ compensation

and services, higher technology utilization and longer value chains.

2. Chapter3 describes in more detail how social dialogue and other instruments can enhance the role of workers and enterprises

in advancing a just transition.

2. Employment in a green economy 39

A. Job creation and job destruction

in the transition to a green economy

The transition to a low-carbon and resource-efcient economy involves changing methods of produc-

tion across several sectors. In particular, changes are required in the energy, agriculture and waste

management sectors to increase their resource efciency and reduce their reliance on GHG emissions

(ILO, 2012; IPCC, 2014). As shown in Chapter1, these are the sectors that account for a high share of

GHG emissions, use a high level of resources and, especially in the case of agriculture, employ large

numbers of people. The required measures will change these industries, as well as the industries that

supply their inputs and depend on their outputs. The resulting changes will cross borders. This section

assesses the impact of the transition to a green economy on the number and types of jobs, taking

into account the economic linkages across industries. It looks at the jobs created both directly and

indirectly and at those destroyed by the transition. Focusing on key sectors of the transition to a green

economy, it rst examines transition in the energy sector, followed by an assessment in the agriculture

sector, and concludes with the adoption of some principles of the circular economy. Box2.1 provides

a brief description of the data and methodology used in the scenarios, suggesting caution in the inter-

pretation of the results. Appendix2.1 provides further methodological details. Appendix2.2 discusses

models typically used to assess the long-term economic impact of climate change on economic growth

and employment.

The scenarios explored in this section rely

on Exiobase v3, a multiregional input-output

table(MRIO) that maps the world economy

and the linkages between industries across

the world (Stadler etal., 2018). Estimating

scenarios using MRIOs allows the simula-

tion of detailed specications of technologies

and processes, with full understanding of the

mechanisms driving the results. Exiobase v3

offers greater precision than other MRIOs, as

it details the transactions between 163 indus-

tries across 44countries and ve regions. The

scenarios esti mate and localize at the regional

and industry level the expected number of

direct and indirect jobs created and destroyed

under various scenarios. Appendix 2.1 provides

methodological details about the data set and

the estimates.

All the scenarios estimate employment and en-

vironmental outcomes by 2030. Each specic

environmentally sustainable scenario is com-

pared to a business-as-usual scenario. All the

scenarios draw on projections of GDP growth

made by the International Monetary Fund (IMF)

and the International Energy Agency (IEA) and

population growth projections by the United

Nations. The scenarios do not assume any

windfall investment in the green economy, but

assume that projected GDP growth and policy

measures will promote investment in green

technologies (box 2.2 examines the investment

needed to achieve climate-compatible devel-

opment). Importantly, as is common in ana-

lyses based on MRIOs, relative prices and the

world trade structure are assumed to remain

constant. In doing so, the models ignore ad-

justment effects but offer a clear picture of the

linkages across industries and the sectors most

affected under each scenario. If, for example,

technological change drives down the cost of a

specic green technology and the technology

matures, the labour requirements could di-

minish, reducing the employment benefits

of this technological adoption. Adjustment

changes are not modelled in this exercise and

could affect the estimates presented here.

Other adjustment costs not considered relate to

the ability of labour to adjust to scenarios: owing

to skills mismatch, for example, and other rigid-

ities in the labour market, it may take longer to

adjust to changing demand for goods and ser-

vices, reducing the employment creation poten-

tial of the technologies investigated. Moreover,

each scenario estimates the impact of a change

in technology or demand for a particular set

of products. In order to identify the specific

effects on each industry, the relative demand

for other unspecified products and techno-

logical processes remains unchanged. Also, to

verify the specic impact of these scenarios,

estimates do not account for other drivers of the

future of work, notably technological change,

globalization and alternative business models.

Technological change, unaccounted for in

these models, may be particularly important in

relatively immature industries which, as tech-

nology develops, may act to lower costs by

improving material or energy efciency or by

reducing labour requirements.

Estimating green economy employment scenarios using Exiobase

Box 2.1

40 World Employment and Social Outlook 2018 – Greening with jobs

Achieving sustainability necessarily involves the energy sector…

The energy sector is key for a successful transition to a low-carbon economy. Together, electricity

and heat production, transport

and buildings account for almost half of global GHG emissions (IPCC,

2014). Replacing fossil fuel-based energy sources with renewables, such as solar or wind, together

with efforts to improve energy efciency, can reduce GHG emissions and contribute to the mitigation

of climate change, while maintaining or increasing energy supply.

As noted in Chapter1, progress has been made in reducing fossil fuel dependency to meet energy

demand and, through the 2015 Paris Agreement, national commitments (i.e. nationally determined

contributions) have been established to reduce GHG emissions. To some extent, a transition is already

occurring, as the renewables sector has been growing rapidly, from 1.5per cent of global electricity

generation in 2000 to 5.5per cent in 2013, favouring employment in the sector (Montt, Maitre and

Amo Agyei, 2018). However, this progress and formal national commitments are not sufcient to

achieve the international goal of limiting global warming to 2°C, or the more desirable goal of 1.5°C.

… with economic and employment effects that will spread to all economic sectors

The International Energy Agency (IEA) has developed country-specic scenarios that decouple the

energy sector from fossil fuels, which would limit global warming to 2°C (IEA, 2015a).

The 2°C scenario

can be achieved by progressive decarbonization in the electricity, transport and construction sectors,

thereby achieving progress towards SDGs 7 (clean energy) and 13 (climate action). (Box 2.3 explores

these effects for the 1.5°C goal as encouraged by the Paris Agreement.) Although employment in these

sectors may be small, as noted in Chapter1, they are closely linked to other economic sectors and

have strong multiplier effects. Changes in the energy sector, through changes in electricity generation,

3. Road transport is also a major contributor to air pollution, accounting for about 50per cent of the total health costs of outdoor

air pollution in OECD countries (OECD, 2014).

4. In Energy Technology Perspectives 2015, the IEA explores several scenarios. The 2°C scenario requires a pathway towards

rapid decarbonization to meet international policy goals. The Reference Technology Scenario takes into account national energy-

and climate-related commitments, which fall short of international policy goals. The 6°C scenario is largely a continuation of

current trends, a business-as-usual scenario, under which CO

emissions would rise by about 60per cent between 2013 and

2050 (IEA, 2017b). The scenarios used in this report take into account each country’s potential energy sources, while meeting

projected energy demand up to 2030.

The OECD (2017) estimates that between

2016 and 2030 an annual investment of

US$ 6.3 trillion will be needed in infrastruc-

ture to meet global development needs.

With only an additional US$ 0.6 trillion,

this investment would be climate com-

patible. As highlighted by the IMF (2017),

this extra investment is worth it: climate

change adaptation and mitigation offer

strong medium- and long-term benets in

terms of employment, productivity, eco-

nomic activity and well-being. The two or-

ganizations also point out that, in view of

the long time horizon, the social returns

and the non-monetized costs associated

with climate-related investment, a mix of

public and private sources of investment

are required (OECD, 2017; IMF, 2017).

Development banks and finance institu-

tions will have an important role to play at

every level, and should value and incorp-

orate climate-related risks alongside the

elimination of fossil fuel subsidies and the

implementation of carbon pricing systems.

Policy coherence, as explored in further

detail in Chapter3, is critical to ensure that

the regulatory framework, policies and in-

vestment offer adequate incentives.

Investment for environmental sustainability

Box 2.2

2. Employment in a green economy 41

transport and construction, will necessarily affect other sectors. For example, in the automotive sector,

electric vehicles entail very different value chains compared to internal combustion engine vehicles.

This will therefore result in changes in forward- and backward-linked industries, as well as in demand

for oil products, and will thus modify consumer spending patterns (for this and other examples, see

Cassar, 2015; Garret-Peltier, 2017; OECD, 2009; Government of Scotland, 2016a; Stehrer and Ward,

2012; UBS Research, 2017; WEF and IHS CERA, 2012; Wild, 2014). The wide-ranging impact of a

transition to a low-carbon energy economy therefore requires consideration for the needs and active

participation of employers and workers in multiple sectors.

Limiting global warming to 2°C through the energy sector means reducing fossil fuel reliance

in electricity and transport and improving energy efciency in buildings and construction…

The IEA identies the changes that are possible and required to limit global warming to 2°C over the

course of the century (2015a). This section draws on this scenario, painting a change in the energy mix

towards greater reliance on renewable energy sources for electricity and heat generation and industry,

and complements it with the projected rise in the share of electric vehicles and building improvements

to achieve greater energy efciency.

In terms of electricity, the scenario implies an increased share of renewables for electricity generation

(including a 59per cent increase in electricity produced from solar photovoltaic panels in 2030, com-

pared to 2012), a decrease in the use of fossil fuels (a 50per cent reduction in coal-based electricity

production), and a drop in overall demand as a result of greater efciency. Similarly, under this scenario,

energy demand by industry would fall by 20per cent by 2030 as a result of greater efciency, and

the remaining energy needs would be met through greater reliance on biomass and waste, rather than

fossil fuel-based energy sources.

Energy is also crucial in transport. Harmful exhaust emissions are largely avoided in the case of electric

and battery-based vehicles, especially if the power to charge electric batteries comes from renewable

The 2015 Paris Agreement calls for the in-

crease in the global average temperature

to be held at well below 2°C above pre-in-

dustrial levels. It encourages countries to

pursue efforts to limit the temperature rise

to 1.5°C, in recognition that this increase

would significantly reduce the risks and

impacts of climate change. The scenario

in this chapter is based on the IEA’s

country- and region-specic blueprints for

achieving the 2°C goal. No such blueprint

exists for the 1.5°C goal which could be

used to estimate its employment outcome.

However, the 2°C scenario offers insight

into the employment implications of the

path to limit warming to 1.5°C. Achieving

the 1.5°C goal would entail a more aggres-

sive decarbonization of the energy sector.

It would imply a more rapid replacement of

fossil fuel-based energy production by re-

newables, and a more aggressive reduction

in energy use through greater efciency.

Judging from the results associated with

the direct and indirect effects of achieving

the 2°C goal highlighted in this chapter, and

the employment implications of investing in

energy efficiency (Garrett-Peltier, 2017),

achieving the 1.5°C goal would magnify

the results shown in gure2.1. Achieving

the 1.5°C goal could prompt action in other

sectors, such as agriculture which, as in-

dicated below, could create employment

or facilitate structural transformation.

Achieving the 1.5°C goal may also require

the development of carbon sinks through

reforestation or carbon capture and seques-

tration technology, which could also create

employment and growth opportunities.

Employment and decent work under the 1.5°C goal

Box 2.3

42 World Employment and Social Outlook 2018 – Greening with jobs

sources.

Forecasts point to around 14per cent of new car sales globally being electric vehicles in

2025, with higher sales projected in Europe (30.6per cent) and China (15.5per cent) than in the

United States (5.1per cent) and the rest of the world (5.2per cent) (UBS Research, 2017).

Finally, the energy demands of buildings and construction are also expected to fall in this scenario, as

a result of construction that pays more attention to resource efciency and retrotting to improve the

efciency of existing buildings. Under this scenario, all savings from energy efciency in the IEA 2°C

and 6°C scenarios in the construction sector are invested in retrotting buildings to achieve efciency

gains. The scenario also takes into account the changes in energy needs in agriculture and sheries.

… and will result in net job creation in almost all regions and sectors

The analyses presented here show an overall positive employment impact from the action taken in the

energy, transport and construction sectors to limit global warming to 2°C over the course of the cen-

tury. As a result, climate action brings about net job creation.

Indeed, progress towards sustainability

in the energy sector will create around 18million more jobs globally by 2030 when compared to the

business-as-usual path, which is equivalent to a 0.3per cent difference between the two scenarios.

Employment creation is driven by the higher labour demand of renewable energy sources in com-

parison with electricity produced from fossil fuel sources, and the employment demand of the entire

value chain associated with renewable energy and electric vehicles and construction.

This overall net jobs benet comes with a 41per cent reduction in GHG emissions by 2030, which is in

line with global policy goals. However, these overall changes conceal sectoral and regional differences,

as summarized in gure2.1. Chapter5 examines in greater depth the types of skills development

programmes required to support this change.

In the renewables sector (hydro, biomass, solar thermal, solar photovoltaic (PV), tide and wave, and

geothermal), job creation is expected to be higher by around 11per cent in the 2°C scenario compared

to the business-as-usual scenario. Net job growth is also expected in manufacturing (0.5per cent) and

construction (1.7per cent). This growth is equivalent to around 4million jobs in manufacturing and

9million in renewables and construction combined. In addition, due to the economic linkages between

sectors, employment in services, waste management and agriculture will also grow. For example, over

2million jobs will be created in the manufacture of the electrical machinery required for the production

of electric vehicles and the generation of electricity from renewables.

At the regional level, there will be net job creation in the Americas, Asia and the Pacic and Europe

(0.45, 0.32 and 0.27per cent, respectively, representing around 3, 14 and 2million jobs). In con-

trast, there will be net job losses in the Middle East (–0.48per cent, or over 300,000 jobs) and Africa

(–0.04per cent, or around 350,000 jobs) if the economic structure of these regions does not divert

from the historical trend.

Under this scenario, policy changes could allay the anticipated job losses or

their negative impact (see Chapters3, 4 and 5).

Reallocation is most evident in the electricity production sector, with employment gains in renew-

able-based electricity (net creation of some 2.5million jobs), offsetting employment losses in fossil

fuel-based electricity generation (net losses of around 400,000 jobs) (table2.1).

This scenario also entails reallocation in other sectors, and particularly mining. Any loss of employ-

ment in the sector due to a reduction in the mining and extraction of coal, petroleum and natural gas

5. The negative environmental effects of the transport sector are due to exhaust emissions from fossil fuel-based internal com-

bustion engines. Negative effects also stem from brakes, tyre wear, the disposal of vehicles and other uses which come in addition

to the emissions of potentially harmful particles and gases. The negative effects of transport that are not due to exhaust of GHGs

are not modelled in the scenarios.

6. This scenario explores only one dimension of sustainability in the transport sector, namely a shift away from the internal com-

bustion engine and towards electric vehicles for people transport. It ignores other initiatives to promote sustainability in the sector,

including in public transport, maritime and air transport, and freight transport.

7. Net job creation refers to the overall impact on job numbers. It considers the direct and indirect jobs created and lost. Net jobs

are created if, on balance, more jobs are created than are lost.

8. Africa’s net job loss is led by a total of around 650,000 jobs lost, mainly in fossil fuel-related sectors (e.g.petroleum renery,

extraction of petroleum and mining of coal, electricity production by coal) and job gains of around 300,000, mainly in the con-

struction, mining of copper ores and manufacture of electrical machinery sectors.

2. Employment in a green economy 43

(around2million job losses), would be partially compensated by the growing demand for inputs for

electric vehicles and electrical machinery (some 2million additional jobs in the mining of copper, nickel,

iron and other non-ferrous and metal ores).

In addition, employment losses are expected in sectors with close linkages to the fossil fuel-based auto-

motive industry. Some job losses are expected in the manufacture of motor vehicles as electric engines

have fewer moving parts and fewer workers are required for each car produced. Also, the life cycle of

electric vehicles is longer than that of vehicles with internal combustion engines (UBS Research, 2017),

and some jobs are expected to be lost in the retail sale of automotive fuel.

In total, as noted above, job creation throughout the economy and in specic sectors more than offsets

job destruction. The net job creation of 18million projected to 2030 is the result of around 24million

jobs created and around 6million jobs lost. Of the 163 economic sectors analysed, only 14show

employment losses of more than 10,000 jobs worldwide, and only two (petroleum renery and extrac-

tion of crude petroleum) show losses of 1million or more jobs (table2.1).

Employment by sector (percentage difference)

–3

–0.25

0.25

0.50

Employment by region (percentage difference)

–0.50

Agriculture Mining Manu-

facturing

Fossil fuels

and nuclear

Renewables Utilities Construction Services Waste

Africa Americas Asia and

the Paciﬁc

Europe Middle East World

Energy sustainability and employment in 2030

Figure 2.1

Notes: Percentage difference in employment between the sustainable energy scenario and the IEA 6°C (business-as-usual)

scenario by 2030. Appendix 2.1 provides further methodological details on the data and methods used. Vertical scales differ

by panel.

Source: ILO calculations based on Exiobase v3.

44 World Employment and Social Outlook 2018 – Greening with jobs

As a result of the sectoral redistribution of employment, the transition will result in a slightly lower

female labour share in employment, if current female labour shares by economic sub-sector remain

constant. This is because the sectors currently associated with green technology (such as electrical

machinery) employ a relatively lower share of women. Reallocation is also likely to benet sectors that

employ fewer highly skilled workers,

which means that employment opportunities will favour low- and

medium-skilled workers.

The scenario will also probably result in a modest reduction in the numbers

of own-account and contributing family workers.

Although, in overall terms, the scenario is expected to lead to net aggregate benets in terms of greater

employment opportunities, certain groups, regions and sectors will face disruption. Transition to an

environmentally sustainable economy requires consideration for these workers. In this context, the

ILO is piloting the Guidelines for a just transition towards environmentally sustainable economies and

societies for all (ILO, 2015) to ensure that no workers are left behind. Chapters4 and5 examine social

protection and skills development policies to support these workers and sectors.

9. As indicated in Appendix 2.1, highly skilled workers are dened by the share of workers in ISCO major groups1, 2 and 3

(managers, professional and technicians and associate professionals).

10. These results contrast with the ndings by Cambridge Econometrics, GHK and the Warwick Institute for Employment Research

(2011) which highlight the demand for higher level skills in a scenario of a low-carbon economy. Besides the different methodo-

logical approaches, the different modelling strategies assume different scenarios, which lead to different industry-to-industry

changes and, ultimately, different labour market outcomes.

Sectors most affected by the transition to sustainability in the energy sector

Industries set to experience

the highest job demand growth (absolute)

Industries set to experience

the strongest job demand decline (absolute)

Sector Jobs

(millions)

Sector Jobs

(millions)

Construction 6.5 Petroleum renery –1.6

Manufacture of electrical machinery and apparatus 2.5 Extraction of crude petroleum and services related

to crude oil extraction, excluding surveying

–1.4

Mining of copper ores and concentrates 1.2 Production of electricity by coal –0.8

Production of electricity by hydropower 0.8 Mining of coal and lignite, peat extraction –0.7

Cultivation of vegetables, fruit, nuts 0.8 Private households with employed persons –0.5

Production of electricity by solar photovoltaics 0.8 Manufacture of gas, distribution of gaseous fuels

through mains

–0.3

Retail trade, except of motor vehicles and

motorcycles; repair of personal and household goods

0.7 Extraction of natural gas and services related

tonatural gas extraction, excluding surveying

–0.2

Industries set to experience

the highest job demand growth (percentage)

Industries set to experience

the strongest job demand decline (percentage)

Sector Jobs

(percentage)

Sector Jobs

(percentage)

Production of electricity by solar thermal energy 3.0 Production of electricity by coal –0.19

Production of electricity by geothermal energy 0.4 Extraction of crude petroleum and services related

to crude oil extraction, excluding surveying

–0.11

Production of electricity by wind 0.4 Extraction, liquefaction, and regasication

of other petroleum and gaseous materials

–0.11

Production of electricity by nuclear energy 0.3 Petroleum renery –0.08

Production of electricity by biomass and waste 0.3 Manufacture of gas, distribution of gaseous fuels

through mains

–0.05

Production of electricity by solar photovoltaics 0.3 Mining of coal and lignite, peat extraction –0.03

Production of electricity by hydropower 0.2 Extraction of natural gas and services related

tonatural gas extraction, excluding surveying

–0.03

Notes: Percentage difference in employment between the sustainable energy and the IEA 6°C (business-as-usual) scenario by 2030. Appendix2.1

provides further details on the data and methods used.

Source: ILO calculations based on Exiobase v3.

Table 2.1

2. Employment in a green economy 45

The agricultural sector needs to reduce environmental degradation

and ensure food security

A transition is also required in agriculture. Since the 1970s, agricultural output has increased three-

fold.

This remarkable achievement has outpaced population growth and resulted in only a 30per

cent increase in the use of cultivated land worldwide (Pingali, 2012). Yet challenges for the agricultural

sector remain. It is necessary to continue improving productivity to secure future food demand, while

becoming environmentally sustainable and overcoming the decent work decits still faced by the sector

(Alexandratos and Bruinsma, 2012; Godfray etal., 2010; ILO, 2016; Swaminathan and Kesavan, 2017).

However, productivity growth has slowed (FAO, 2017). Food security remains a priority, particularly in

view of the world’s rapidly growing population and the expected dietary changes that follow economic

growth. Agriculture has become a major contributor to GHG emissions (through land use change,

livestock and fertilizer use), soil degradation (the loss of organic matter as a result of overexploitation

and mismanagement), desertication and freshwater scarcity (through inadequate land and crop man-

agement), biodiversity loss, pest resistance and water pollution (resulting from change in land use,

eutrophication, run-off and improper nutrient management) (FAO, 2011). Mostly as a result of intensive

farming, about a third of the world’s soil has already been degraded and, if current rates continue, all

of the world’s topsoil could be degraded in 60 years (FAO, 2015a). These environmental challenges

contribute to environmental degradation at the global and local levels. Agriculture is itself vulnerable to

environmental degradation (through natural hazards and the loss of ecosystem services, as noted in

Chapter1), which jeopardizes the livelihoods of farmers and food security around the world.

Future food security (SDG2) can only be sustainable if it is coupled with environmental sustainability,

climate action (SDGs 13, 14 and 15) and adaptation to climate change. It requires the adoption of

different agricultural practices and adaptation to climate change, water scarcity and land degradation

(ELD Initiative and UNEP, 2015; FAO, 2016a and 2016b; Pagiola, 1999). It also requires investment in

infrastructure to enhance productive potential and resilience to climate change (e.g. irrigation, roads

and transport, storage, as well as extension services and research, development and access to im-

proved seed varieties) (Headey and Jayne, 2014; Jayne, Chamberlin and Heady, 2014; OECD, 2017).

Transforming agriculture also offers an opportunity to transform the world of work and reduce the many

decent work decits in the sector. It should bring workers in the sector out of poverty. Over 1 billion

people work in the agricultural sector, the majority on smallholder and family farms (Lowder, Shoet

and Raney, 2016). Most of the working poor are employed in agriculture (ILO, 2016). In developed

and emerging economies, migrant workers from poorer regions make up to 70per cent of the sector’s

wage workers (BLS, 2017). In the case of developing countries, allowing employment to transit out of

agriculture is key to supporting national structural transformation (ILO, 2005 and 2016).

Although there is agreement that sustainable agriculture must simultaneously ensure food security,

while reducing its impact on the environment and promoting decent work, there is less agreement on

the specic techniques required to achieve these aims (Zahm etal., 2015). Among others, conservation

agriculture and organic agriculture have been proposed to overcome some of the environmental chal-

lenges. Both conservation and organic agriculture imply a change in inputs and modes of production,

affecting the world of work (boxes 2.4 and 2.5 describe them in further detail).

Table 2.2 summarizes

the main implications for smallholder and large farms, with emphasis on the environment, food security

and the world of work.

11. The productivity increase in agriculture following the Green Revolution is the result of investment in crop research, infrastruc-

ture, market development and policy support between 1965 and 1985. After this period, scientic advances in crop genetics were

adapted to developing countries, propagating productivity growth in the developing world (Pingali, 2012). Some negative impacts

have accompanied the Green Revolution, including environmental degradation, increased income inequality, inequitable asset

distribution and higher levels of absolute poverty (Hazell, 2003).

12. Zahm etal. (2015) note that Biodynamic Agriculture, Humus Farming and Alternative Agriculture were developed prior to

the 1990s with a multidimensional approach to sustainability at their core. As with any agricultural technique, there is no one-

size-ts-all approach to sustainable agriculture. No specic system can achieve sustainability in every situation, which is why

this section focuses on the broader approaches encompassed by conservation agriculture and sustainable organic farming. The

System of Crop Intensication (SCI), developed from the System of Rice Intensication (SRI), shows how crop, land and resource

management techniques that take advantage of the interactions, dependencies and interdepencies between the crops and

microorganisms can greatly improve yields and reduce the ecological impact of agriculture (Abraham etal., 2014; Uphoff, 2012).

46 World Employment and Social Outlook 2018 – Greening with jobs

Conservation agriculture (CA) is an agro-

ecosystem management system character-

ized by: (i) continuous minimum mechan-

ical soil disturbance (minimum or no tillage);

(ii)permanent soil cover; and (iii) the diversi-

cation of crops grown in sequence or asso-

ciation (FAO, 2015b). Minimum or no tillage

limits the harmful effects of regular tillage

that are common in conventional agriculture,

allowing the maintenance of organic matter

in the soil and increased soil quality through

higher water holding capacity, lower sus-

ceptibility to erosion and a greater capacity

of the soil to release nutrients in synchrony

with crop demand. Reducing tillage limits

the possibility of creating a hardpan at the

bottom of the cultivated layer and reduces

evaporation from the soil surface, which ex-

poses seedlings to water stress (Johansen

etal., 2012). CA reduces agricultural GHG

emissions because it requires less fuel for

machinery and increases the carbon se-

questration potential of the soil (Dendooven

etal., 2012).

CA is currently practised on over 125mil-

lion hectares, or around 9per cent of arable

land worldwide. It is practised on over

70per cent of arable land in Argentina,

Brazil, Paraguay and Uruguay. CA is be-

coming increasingly widespread, owing

to its applicability and observed benets

across different climates, soil types, crops

and farm characteristics. It is applicable in

various contexts: from the Arctic Circle to

the tropics and the southern extremes; at

sea level and at 3,000 metres of altitude;

in extremely rainy and extremely dry areas

(Friedrich, Derpsch and Kassam, 2017).

At the level of individual farms, one of

the main drivers for the adoption of CA is

higher prots, resulting from lower labour

costs and higher productivity (Knowler and

Bradshaw, 2007). These benets accrue

for large-scale farms (Friedrich, Derpsch

and Kassam, 2017; Pannell, Llewellyn and

Corbeels, 2014), and there is emerging

evidence that they can also benet small-

holder and family farms (Johansen etal.,

2012; Lalani, Dorward and Holloway, 2017;

Pannell, Llewellyn and Corbeels, 2014).

Importantly for the world of work, CA

farming requires around 50–60per cent

fewer work hours at the beginning of the

growing season, due to the lower demand

for labour for land preparation. For large

mechanized farms, savings exist, but are

small, as labour costs amount to less than

10per cent of total costs per acre (FAO,

2001). For labour-intensive farms the sav-

ings can be important, but at the expense

of employment opportunities in rural econ-

omies with cross-border implications when

migrant workers are implied, as is common

in developed and emerging economies. For

smallholders and family farms supplying

their own labour, lower labour requirements

may free family workers from farm duties,

allowing them to diversify their income.

By minimizing or eliminating tilling, CA

removes one of the primary short-term

benefits of conventional tillage, namely

weed control. To control weeds, CA re-

quires more frequent application of her-

bicides (Johansen etal., 2012). Although

they are less toxic than insecticides, inap-

propriate and unsafe exposure to herbicides

can pose serious health risks for workers

and communities (Donham, 2016; Frank

etal., 2004).

As a result of the need for

integrated nutrient management, increased

fertilizer and herbicide use and crop rota-

tion and/or association, CA requires greater

management skills. It also requires different

machinery, which may create an entry bar-

rier. These factors may hinder the adoption

or optimal implementation of CA by small-

holders and family farmers with low skills

(Knowler and Bradshaw, 2007).

The Safety and Health in Agriculture Convention, 2001 (No.184), ratied by 16 countries, requires the sound manage-

ment of chemicals (Articles 12 and 13). It also requires employers to carry out risk assessments, to provide appropriate

training when chemicals are used and to stop any operation where there is an imminent and serious danger to safety and

health (Article 7). Workers have the right to be informed on safety and health matters, participate in the application and

review of safety and health measures and remove themselves from danger, and they have the duty to comply with safety

and health measures (Article 8).

Conservation agriculture minimizes soil disruption and increases yields

Box 2.4

2. Employment in a green economy 47

Organic agriculture is “a production system

that sustains the health of soils, ecosys-

tems and people. It relies on ecological

processes, biodiversity and cycles adapted

to local conditions, rather than the use

of inputs with adverse effects” (IFOAM,

2008). In 2015, around 51million hectares

were organic farmland or under conver-

sion, representing almost 3.7per cent of

total agricultural land. In some ten coun-

tries, including Austria, Czech Republic,

Italy, Sao Tome and Principe, Sweden and

Switzerland, over 10per cent of agricultural

land is organic (Willer and Lernoud, 2017).

For over two decades, the adoption of or-

ganic agriculture has been seen as a means

of improving livelihoods in Uganda, which

is the largest organic producer in Africa,

with over 200,000 internationally certied

farmers and 2per cent of agricultural land

(Poschen, 2015; Rukundo, 2014).

Organic agriculture emphasizes environ-

mental protection through the entire farm-

to-consumer chain. It excludes the use

of articial products, such as genetically

modied organisms, synthetic pesticides,

veterinary drugs, additives and min-

eral fertilizers (Morgera, Bullón Caro and

Marín Durán, 2012). Organic agriculture,

compared to conventional agriculture,

promotes soil quality and biodiversity, re-

duces nutrient leaching and requires less

energy (Mondelaers, Aertsens and van

Huylenbroeck, 2009; Tuomisto etal., 2012).

Studies have also found benets of organic

agriculture in terms of water retention and

use, reduced erosion (Nemes, 2009) and

the maintenance of ecosystem services

(Mereld etal., 2017). Under situations of

bio-physical stress (e.g. drought), organic

yields are higher than conventional yields.

The average yield of organic farms is gen-

erally lower than conventional farms for a

wide range of crops throughout the world.

In developing countries, yields in organic

agriculture average 84per cent of those of

conventional agriculture, while the gureis

79per cent in developed countries (de

Ponti, Rijk and van Ittersum, 2012). To a

large extent, these averages mask differ-

ences in the specific conditions of each

farm.

With good management practices,

organic systems can nearly match con-

ventional yields (Seufert, Ramankutty and

Foley, 2012). When compared to sub-

sistence farming, the adoption of organic

farming increases yields, although they

might have increased further if subsistence

farming had adopted conventional intensive

farming techniques (Auerbach, Rundgren

and Scialabba, 2013). Organic farms may

contaminate less, but they need more land

to produce the same quantity of output

(Tuomisto etal., 2012), unless reductions

in food waste, food-competing feed from

arable land and the production and con-

sumption of animal products complement

the large-scale adoption of organic farming

(Muller etal., 2017).

For farmers, the higher market prices and

growing demand for organic produce and

lower production costs offset any reduction

in yield (Nemes, 2009). However, higher

prices may make it difcult for poor and de-

veloping countries to achieve food security.

As with conservation agriculture, the con-

version to organic agriculture entails con-

siderable changes in labour use. Organic

agriculture is more labour intensive

than conventional agriculture, as noted

by studies in Europe (EC, 2013), India

(Charyulu, Kumara and Biswas, 2010) and

Ghana (Kleemann, 2016), but the work may

not necessarily be decent. The exclusion of

synthetic pesticides may reduce exposure

to harmful chemicals and reduce occupa-

tional health and safety risks, potentially

improving working conditions.

Swaminathan and Kesavan (2017) note that green agriculture considers the linkages between farm processes and the

broader ecosystem and conditions, but allows the use of chemical inputs within integrated pest and nutrient management

schedules. They also note that organic agriculture encompasses several approaches, including Effective Microorganisms

Agriculture, One-Straw Revolution (natural farming with no ploughing, chemical fertilizers, weeding or chemical pesticides

and herbicides) and White Agriculture (substantial use of micro-organisms, and particularly fungi). They highlight the

Evergreen Revolution as an ecosystem-integrated farm system that exploits synergies between crop and animal associ-

ations, both within the farm and with the surrounding ecosystem although, as with other sustainable farming systems, it

requires a substantial knowledge base. Chapter5 further examines the skills development programmes in place to support

the transition towards environmentally sustainable agriculture.

Seufert, Ramankutty and Foley (2012) note that the yields of organic farms are only 5per cent lower in the case of

rain-fed legumes and perennials in weak-acidic or weak-alkaline soils, but can be 25per cent lower for cereal crops such

as maize and wheat, and vegetables such as broccoli.

Organic agriculture relies on ecological processes, biodiversity and natural cycles

Box 2.5

48 World Employment and Social Outlook 2018 – Greening with jobs

Unless sound crop, nutrient and waste management techniques are adopted, organic and conservation

agriculture may not be sustainable and may not eliminate environmental degradation, and will instead

lead to the degradation of the organic content of the soil, the pollution of water sources and eutrophica-

tion as a result of run-off. Furthermore, unless they are accompanied by investments in infrastructure,

access to nance, social protection, governance reform, research and development and outreach,

among others, organic and conservation agriculture by themselves will not ensure adaptability to en-

vironmental degradation, food security and environmental sustainability.

Importantly, conservation and organic agriculture are not mutually exclusive. For example, the FAO

Save and Grow (2011) approach extracts the environmental benets of both, but highlights their im-

portant implications for rural economies due to their lower labour intensity. The FAO Sustainability

Assessment of Food and Agriculture systems (2014) offers clear guidelines on how food systems

can achieve sustainability through good governance, environmental integrity, economic resilience and

social well-being.

Conservation and organic agriculture can bring sustainability to agriculture,

though with different implications for wage employment and smallholder farms

Conservation agriculture and organic agriculture can be sustainable if adequate crop, soil, pest, nutrient

and waste management techniques are adopted alongside investments in infrastructure, access to

nance, outreach, social protection and other policies. This section explores a scenario in which con-

servation agriculture is adopted in developing countries and organic agriculture in developed countries.

Under this scenario, output from these sustainable forms of agriculture grows to reach 30per cent

of each country’s total output by 2030.

Due to data constraints, the scenario does not explore the

impact of other changes required in agriculture to achieve sustainability, as noted above.

13. In view of the price differential between output from conventional and conservation and organic agriculture, large-scale

conversion to organic agriculture may limit progress towards achieving food security. Much of the produce of organic agriculture

in developing countries is exported to developed countries and is not destined for local consumption.

14. Appendix 2.1 provides a summary of the conservation- and organic-to-conventional input ratios used in the analysis.

Environmental and work-related impacts of conservation and organic agriculture

Conservation agriculture Sustainable organic farming

Environment

andfood

security

Increases soil water retention Increases soil water retention

Increases soil organic matter Increases soil organic matter

Reduces GHG emissions Reduces GHG emissions

Reduces soil erosion Reduces soil erosion

Increases use of pest control and, initially, fertilizers Reduces use of synthetic pesticides and mineral fertilizers

Higher yield limits can promote productivity growth

without pressure on land resources

Lower yields may increase pressure on land resources

Similar prices to conventional agriculture can promote food security

in developing countries

Higher prices than conventional agriculture may reduce access

to crops and food security for poor and developing countries

Work on

smallholder

farms

Higher yields and lower costs lead to higher income for farmers Higher income due to lower costs and higher prices (lower yields

than conventional farming, higher yields than subsistence farming)

Lower labour needs increase the ability of farmers to diversify

their income

Higher labour needs reduce the ability of family farmers to diversify

their income

High up-front costs in terms of machinery, tools, management

skills, and lower yields during the conversion phase

High up-front costs due to lower yields during the conversion phase

Higher exposure to potentially harmful chemicals Lower exposure to potentially harmful chemicals

Crop residues no longer used for feed or construction materials Crop residues can be used for feed or construction materials

Work

on large

farms

Higher yields and lower costs lead to higher income for farmers Higher prices and lower costs offset lower yields

and increase farmers’ income

Lower labour needs may reduce the demand for paid workers

in rural areas

Higher labour needs increase demand for (potentially non-decent)

work in rural areas

Higher worker exposure to potentially harmful chemicals Lower exposure to potentially harmful chemicals

Notes: Impacts of conservation and organic agriculture in comparison with conventional agriculture. Light-coloured cells indicate positive effects,

darker ones indicate negative effects.

Table 2.2

2. Employment in a green economy 49

Figure 2.2 shows how a transition in agriculture that means adopting conservation agriculture in de-

veloping countries and organic agriculture in developed countries will result in reduced employment

in all regions except Europe. This is largely driven by the lower labour requirements of conservation

agriculture, when implemented in regions that have a high share of workers in the sector. Under this

mixed scenario, around 120million fewer jobs will be required than under the business-as-usual

scenario (a –1.9per cent difference in employment between the two scenarios). This means around

4.8per cent fewer jobs in agriculture, with losses concentrated in Africa (–3.5per cent, or over 20mil-

lion fewer jobs) and Asia and the Pacic (–2.2per cent, or 100million fewer jobs). This could result

in reductions in wage employment, but could also offer opportunities for smallholder and family farms

by allowing workers to seek other opportunities and to diversify their household incomes. Fewer jobs

in agriculture in Africa and in Asia and the Pacic may free labour to sustain policies that promote

structural transformation if complemented by adequate industrial and skills policy (see, for example,

Chapters3, 4 and5; ILO, 2005; Salazar-Xirinachs, Nübler and Kozul-Wright, 2014). The adoption of

organic agriculture in developed countries, by contrast, will attract more labour to the sector, leading to

a 1.1per cent growth in employment in agriculture in Europe. Table 2.3 lists the sectors most affected

by the adoption of conservation and organic agriculture.

–3

–4

–2

–1

Employment by sector (percentage difference)

–5

–2

Employment by region (percentage difference)

–4

Agriculture Mining Manu-

facturing

Fossil fuels

and nuclear

Renewables Utilities Construction Services Waste

Africa Americas Asia and

the Paciﬁc

Europe Middle East World

Sustainability in agriculture and employment in 2030

Figure 2.2

Notes: Sustainability in agriculture is dened as adoption of conservation agriculture in developing and emerging countries,

and adoption of organic agriculture in developed economies. The percentage differences in employment by 2030 are between

(i) a scenario in which 30 per cent of agricultural production is organic in developed countries and 30 per cent of agricultural

production results from conservation agriculture in developing and emerging countries, and (ii) the IEA 6°C (business-as-usual)

scenario. Appendix 2.1 provides further methodological details on the data and methods used. Vertical scales differ by panel.

Source: ILO calculations based on Exiobase v3.

50 World Employment and Social Outlook 2018 – Greening with jobs

In view of the linkages between conservation and organic agriculture and other economic sectors (such

as mining, fertilizer manufacture, pest control and machinery, in the case of conservation agriculture,

and organic fertilizers and pest control systems for organic agriculture), the promotion of sustainability

in agriculture will create jobs in industries associated with the production, distribution and sale of spe-

cic inputs for these agricultural systems. For example, the promotion of sustainability in agriculture will

promote employment in waste management, construction, renewable energy and services.

Both conservation agriculture and organic agriculture can promote environmental sustainability, for

example by reducing GHG emissions in the agricultural sector. However, in view of its lower yields, there

are concerns about the extent to which organic agriculture will increase pressure on land resources,

particularly when considering the 50per cent increase in food, feed and biofuel demand by 2050

(FAO, 2017). Concerns regarding yields can be offset by reductions in food waste, which in many cases

require improvements in infrastructure for the transport and storage of agricultural products. Whatever

the path adopted in agriculture, it can only be sustainable when accompanied by proper nutrient, crop

and waste management.

Moreover, the promotion of sustainability can lead to important changes in the rural economy, requiring

close attention and complementary policies, as those outlined by the ILO’s 2015 Guidelines for a just

transition to environmentally sustainable economies and societies for all, to ensure that the transition

is just and that it creates decent work.

Sectors most affected by the transition to sustainability in agriculture

Industries set to experience

the highest job demand growth (absolute)

Industries set to experience

the strongest job demand decline (absolute)

Sector Jobs

(millions)

Sector Jobs

(millions)

Poultry farming 0.6 Cultivation of vegetables, fruit, nuts –83.1

Pig farming 0.5 Cultivation of paddy rice –8.3

Cattle farming 0.5 Cultivation of crops n.e.c. –7.8

Research and development 0.2 Cultivation of cereal grains n.e.c. –6.2

Production of electricity by solar photovoltaics 0.2 Cultivation of wheat –5.5

Meat animals 0.1 Cultivation of oil seeds –4.4

Composting of food waste, incl. land application 0.0 Cultivation of plant-based bers –4.1

Industries set to experience

the highest job demand growth (percentage)

Industries set to experience

the strongest job demand decline (percentage)

Sector Jobs

(percentage)

Sector Jobs

(percentage)

Composting of paper and wood, incl. land

application

0.12 Cultivation of sugar cane, sugar beet –0.08

Production of electricity by solar photovoltaics 0.06 Cultivation of plant-based bers –0.08

Composting of food waste, incl. land application 0.05 Cultivation of crops n.e.c. –0.08

Cattle farming 0.01 Cultivation of paddy rice –0.07

Production of electricity n.e.c. 0.01 Cultivation of vegetables, fruit, nuts –0.07

Research and development 0.01 Cultivation of cereal grains n.e.c. –0.07

Poultry farming 0.00 Cultivation of wheat –0.06

Notes: Sustainability in agriculture is dened as adoption of conservation agriculture in developing and emerging countries, and adoption of organic

agriculture in developed economies. Percentage differences in employment by 2030 are between the scenarios in which 30 per cent of agricultural

production is organic in developed countries and 30 per cent of agricultural production is conservation agriculture in developing countries and the

IEA 6°C (business-as-usual) scenario. Appendix 2.1 provides further methodological details about the data and methods used.

Source: ILO calculations based on Exiobase v3.

Table 2.3

2. Employment in a green economy 51

Advancing towards a circular economy will also create jobs

In addition to energy and agriculture, Chapter1 noted how resource-intensive sectors such as mining

and manufacturing will also undergo substantial changes on the path towards sustainability. Current

models could be typied as linear: extract, manufacture, use and discard. The circular economy, as an

alternative, is based on the principle of produce-use-service-reuse. One of its tenets is to reduce the

extraction of raw materials and to rely instead on reuse, repair and recycling. In a circular economy,

products are designed to have longer lives and to be repaired, reused or recycled. Through changes to

the incentive structure for enterprises to produce more durable goods and goods that serve as inputs

into other production streams when they are no longer usable, the circular economy keeps products,

components and materials at a high level of utility and value (Ellen MacArthur Foundation, 2013). In

view of the interlinkages in the manufacturing sector and the fact that inputs are recycled, employment

changes are warranted in extractive and waste management industries. Acircular economy also results

in changes in the services sector, as repair and rental services gain in importance over the replacement

and ownership of goods (Wijkman and Skånberg, 2016).

Employment by sector (percentage difference)

–25

0.5

1.0

1.5

2.0

Employment by region (percentage difference)

–0.5

Agriculture Mining Manu-

facturing

Fossil fuels

and nuclear

Renewables Utilities Construction Services Waste

Africa Americas Asia and

the Paciﬁc

Europe Middle East World

The circular economy and employment in 2030

Figure 2.3

Notes: Percentage difference in employment between the circular economy scenario and the IEA 6°C (business-as-usual)

scenario by 2030. Appendix 2.1 provides further methodological details on the data and methods used. Vertical scales differ

by panel.

Source: ILO calculations based on Exiobase v3.

52 World Employment and Social Outlook 2018 – Greening with jobs

This scenario, summarized in gure2.3, explores the employment impact of a sustained 5per cent

annual increase in recycling rates for plastics, glass, wood pulp, metals and minerals, replacing the

direct extraction of the primary resources for these products. This scenario also models growth in the

service economy, which, through rental and repair services, reduces ownership and replacement of

goods at an annual rate of 1per cent.

Under the circular economy scenario, worldwide employment would grow by 0.1per cent by 2030

in comparison with a business-as-usual scenario. This is equivalent to around 6million more jobs in

an economy that adopts certain tenets of the circular economy, such as recycling and the service

economy. Employment growth is led by growth in services and waste management, with some 50 and

45million jobs, respectively.

15. In view of the limits to the recyclability of materials, recycling rates are capped at 65per cent and remain stable thereafter.

A 65per cent recycling rate coincides with the European Union Circular Economy Package (EC, 2015). As indicated by the Ellen

MacArthur Foundation (2013), this scenario only develops two dimensions of a circular economy and, for example, ignores the

potential effects of changes to product design that enhances the durability, remanufacture, reusability and repair of goods.

Sectors most affected by the transition to a circular economy

Industries set to experience

the highest job demand growth (absolute)

Industries set to experience

the strongest job demand decline (absolute)

Sector Jobs

(millions)

Sector Jobs

(millions)

Reprocessing of secondary steel into new steel 30.8 Manufacture of basic iron and steel and

of ferro-alloys and rst products thereof

–28.2

Retail trade, except of motor vehicles and

motorcycles; repair of personal and household goods

21.5 Mining of copper ores and concentrates –20.8

Production of electricity by solar photovoltaics 14.7 Manufacture of wood and of products of wood

andcork, except furniture; manufacture of articles

of straw and plaiting materials

–10.2

Wholesale trade and commission trade,

except of motor vehicles and motorcycles

12.2 Mining of iron ores –8.0

Reprocessing of secondary wood material

into new wood material

5.0 Manufacture of glass and glass products –7.6

Sale, maintenance, repair of motor vehicles,

motor vehicles parts, motorcycles, motor cycles

parts and accessories

4.7 Mining of coal and lignite; peat extraction –4.9

Research and development 3.5 Mining of nickel ores and concentrates –4.3

Industries set to experience

the highest job demand growth (percentage)

Industries set to experience

the strongest job demand decline (percentage)

Sector Jobs

(percentage)

Sector Jobs

(percentage)

Reprocessing of secondary lead into new lead,

zinc and tin

15.0 Production of electricity by coal –0.9

Reprocessing of secondary precious metals

into new precious metals

11.2 Extraction of crude petroleum and services related

to crude oil extraction, excluding surveying

–0.9

Production of electricity by solar photovoltaics 4.9 Extraction, liquefaction, and regasication

of other petroleum and gaseous materials

–0.9

Reprocessing of secondary copper into new copper 4.3 Petroleum renery –0.8

Reprocessing of secondary wood material

into new wood material

4.2 Manufacture of gas; distribution of gaseous fuels

through mains

–0.8

Reprocessing of secondary steel into new steel 3.1 Mining of coal and lignite; peat extraction –0.8

Reprocessing of secondary aluminium

into new aluminium

2.7 Extraction of natural gas and services related

to natural gas extraction, excluding surveying

–0.8

Notes: Percentage difference in employment between the circular economy scenario and the IEA 6°C (business-as-usual) scenario by 2030.

Appendix 2.1 provides further methodological details on the data and methods used.

Source: ILO calculations based on Exiobase v3.

Table 2.4

2. Employment in a green economy 53

These employment gains, driven for example by recycling services, offset employment losses in mining

and manufacturing (where losses are expected to be around 50 and 60million jobs, respectively). This

is largely due to the replacement of the extraction of primary resources and the production of metals,

plastics, glass and pulp by the recycling and reprocessing of secondary metals, plastics, glass and

pulp.Table 2.4 shows the sectors most affected by the adoption of the circular economy.

This sectoral reallocation leads to different effects in the various regions, with employment growth

driven mostly by increases in the Americas (over 10million jobs) and Europe (around 0.5million jobs).

In contrast, net employment losses are expected in Asia and the Pacic (around 5million jobs), Africa

(around 1million jobs) and the Middle East (around 200,000 jobs) if no action is taken to promote

economic diversication. By beneting jobs in services, and if the gender distribution across sectors

remains similar, the circular economy will rise the female share of employment and highly skilled jobs.

However, it will also result in a small increase in the numbers of own-account and contributing family

workers, highlighting the importance of decent work policies to complement policies to promote the

circular economy.

B. Green jobs

As noted above, the transition to low-carbon, resource-efcient economies will lead to changes in the

occupational structure of the economy, with some jobs being destroyed and others created during the

transition. Jobs are also likely to be transformed, requiring a skills transformation, as further examined

in Chapter5. When seen in this light, it may seem that jobs are passively moulded by the transition. But

in practice jobs, and particularly green jobs, can act as a catalyst for the transition to a green economy,

and can be considered a policy objective in themselves (ILO, 2013a). This section describes in more

detail what green jobs are, highlighting how they can be active agents in the transition.

Green jobs are dened as follows: they reduce the consumption of energy and raw materials, limit

greenhouse gas emissions, minimize waste and pollution, protect and restore ecosystems and enable

enterprises and communities to adapt to climate change. In addition, green jobs have to be decent

(UNEP, 2008). They can be found in any economic sector and any enterprise, including the environ-

mental goods and services sector (box2.6). The rural sector offers many opportunities for the creation

of green jobs, and particularly green jobs that further the traditional practices of indigenous and tribal

peoples, which can advance sustainability (see box1.2). Importantly, green jobs can enhance the

transition to a green economy (ITC-ILO, 2016).

Measurements of the number of green jobs throughout the world are scarce. Some efforts have been

made in the European Union (Eurostat, 2017), the United States (Elliott and Lindley, 2017) and the

United Kingdom (ONS, 2017), but they are based on different denitions and may not be comparable.

They usually focus only on environmental goods and services, and therefore do not capture all types

of green jobs, for example failing to count jobs that improve the environmental impact of production

processes in enterprises in any industry.

Some national denitions of green jobs also tend to exclude

the decent work component; ignoring a key component of green jobs makes comparisons across esti-

mates difcult (see, for example, BLS, 2010).

In 2013, the 19th International Conference of Labour Statisticians adopted statistical guidelines on

Employment in the environmental sector and green jobs that overcome these limitations (ILO, 2013b).

The ILO subsequently developed survey instruments and led work for the implementation of the guide-

lines in practice. Data from pilot surveys conducted in Albania (ILO, 2014) and Mongolia (NSO, 2017)

offer the rst insights into the extent of employment in the environmental goods and services sector

and in green jobs, and their characteristics.

16. The United States Bureau of Labor Statistics denes green jobs as those pertaining to both the production of environmental

goods and services and the promotion of environmentally friendly production processes within enterprises (BLS, 2010). Only jobs

in the environmental goods and services sector have been measured in the United States. Efforts to continue the measurement

of green jobs have been dropped (BLS, 2013).

54 World Employment and Social Outlook 2018 – Greening with jobs

For example, in Mongolia in 2016, employment in the environmental sector was estimated at

374,100workers, of whom 233,500 are employed in the production of environmental outputs and

341,500 in environmental processes (some workers can work simultaneously in environmental output

and environmental processes). Of the 374,100 jobs in the environmental sector, 112,300 (30per

cent of employment in the environmental sector, or 9.9per cent of total employment) are green jobs

because they are also decent, being covered by social security schemes. From the perspective of

wages, 196,800 jobs in the environmental sector (53per cent of jobs in the environmental sector, or

17.4per cent of total employment) would be considered green as they pay decent wages (that is, they

pay more than two-thirds of median earnings).

The ILO supports governments, employers and workers in the promotion of a just transition towards en-

vironmentally sustainable economies and societies for all. Following the Tripartite Meeting of Experts on

Sustainable Development, Decent Work and Green Jobs, held in 2015, the ILO’s Governing Body noted

the Guidelines for a just transition towards environmentally sustainable economies and societies for all

at its 325th Session in 2015. The ILO has begun using the Guidelines in its activities in Uruguay and

the Philippines (box2.7), as well as Ghana. The Guidelines propose a set of balanced policy measures

to be developed within each country, based on social dialogue, to facilitate the transition towards envir-

onmentally sustainable economies and societies by setting the right incentives for enterprises and pro-

tecting workers. The ILO has also collaborated with the UK Department for International Development

(DfID), UN Environment, UN-Habitat and the county governments in the Maasai pastoralist commu-

nities of Narok and Kajiado in Kenya to reduce vulnerabilities to climate risks and improve livelihoods

and living standards. The project beneted pastoralist women through the creation of green jobs in

the building industry, while contributing to community resilience and poverty reduction.

The ILO was

also involved in the Euro-Mediterranean Green Jobs (EGREJOB) project which brought together bodies

and associations from Italy, Lebanon, Spain and Tunisia for the development of the green economy.

17. Project information can be found at: http://www.ilo.org/global/about-the-ilo/newsroom/features/WCMS_554979/lang--en/

index.htm

Environmental goods and services are

those that directly benet the environment

or conserve natural resources. They can

be specic environmental services (such

as waste and wastewater management and

treatment, energy and water-saving activ-

ities, conservation and protection), environ-

mental sole-purpose goods, which have no

use except for environmental protection or

resource management (e.g., catalytic con-

verters, septic tanks, installation of renew-

able energy production technologies), or

adapted goods that have been modied to

be cleaner or more resource efcient (such

as buses with lower emissions).

Estimates of the number of jobs in the en-

vironmental goods and services sector can

differ, as not all denitions are completely

consistent. Nonetheless, estimates suggest

that the sector accounted for 2.0per cent of

employment in the European Union (EU-28)

in 2013, employing 4.1million people. In

the United States, the sector employed

3.4million people in 2011, or 2.6per cent

of overall employment (Elliott and Lindley,

2017; Eurostat, 2017; ILO, 2013b and 2014;

NSO, 2017).

Jobs in the environmental goods and services sector

Box 2.6

2. Employment in a green economy 55

Uruguay has been increasingly focusing on

implementing the SDGs and action on climate

change. It is actively promoting a just transition

to a green economy. Accordingly, Uruguay’s

Decent Work Country Programme (DWCP),

adopted in 2015, emphasizes the importance

of productive development to encourage busi-

ness development and job creation. A rst ILO

Green Jobs Assessment made an estimate of

the green jobs already existing in the country

and their contribution to GDP as a baseline for

action to promote the creation of green jobs.

It also recognized the opportunities and weak-

nesses at the national level for creating green

jobs. National studies show the relevance of

green jobs in promoting environmental protec-

tion, securing improvements in competitiveness

and the transition towards a greener economy.

The Philippines is highly vulnerable to extreme

weather events and other, long-term, climate

risks. Climate change will have an almost cer-

tain and long-term impact on its economy,

sustainable development, social equity and

national security. In April 2016, the Philippine

Government adopted the Green Jobs Act, with

the aim of leveraging the process of structural

change towards a sustainable, low-carbon,

climate-resilient economy that creates decent

jobs on a signicant scale.

The pilot implementation of the Guidelines in

Uruguay started in 2016 and has two main ob-

jectives. First, to create employment, while sim-

ultaneously protecting natural resources and

ensuring decent work and social well-being.

Second, to develop a model of intervention to be

followed by other countries and stakeholders for

the implementation of the Guidelines and the

adoption of green jobs strategies. Consultations

with tripartite stakeholders, studies on renew-

able energy sectors and capacity-building

through training activities will contribute to the

implementation of the Guidelines.

In the Philippines, the implementation of the

Guidelines follows a dual approach. First, a

Green Jobs Assessment, analytical research,

capacity-building and advocacy will develop

ways to enable the creation of sustainable en-

terprises and decent work opportunities and

to ensure social well-being. Second, a tech-

nical working group and tripartite cooperation

have developed an intervention model at the

industry, enterprise and local levels with cap-

acity-building activities for all stakeholders to

showcase measures associated with the just

transition. These activities have resulted in

measurements of green jobs, modelling and

policy, which have been presented to and

validated by all the relevant stakeholders as a

basis for developing a framework and specic

policies. These evidence-based activities have

raised the awareness of stakeholders and the

general public. Finally, the intervention model

for just transition has been developed and

tested at the industry, sectoral and local levels.

With funding from the Swedish International

Development Cooperation Agency and other

ILO sources of funding, the pilot implemen-

tations of the Guidelines in Uruguay and the

Philippines have so far resulted in the establish-

ment of a tripartite project steering committee

and national dialogues to dene priorities, pro-

ject strategy and expected outcomes, based on

the contribution of green jobs to society.

In Uruguay, it has also resulted in: (1)sectoral

research focusing on (a) the impact of a national

renewable energy strategy on employment; and

(b) a study on green jobs in the citrus sector to

understand the expected changes, challenges

and opportunities; (2)capacity-building activities

to provide stakeholders with guidance on the

implementation of the project, and knowledge

and understanding of green jobs and possible

strategies and policies to promote their creation;

and (3)collaboration with other actors through

partnership with United Nations Environment

and Deutsche Gesellschaft für Internationale

Zusammenarbeit (GIZ), among others, as well

as regional cooperation through workshops.

In the Philippines, it has also resulted in:

(1)strengthening social partners’ and other

stakeholders’understanding of the need for

the transition to a green economy through sus-

tainable development, decent work and green

jobs; (2)the integration of a Just Transition

Framework in the implementing rules and

regulations of the Green Jobs Act, together with

the development of the Green Jobs Human

Resource Development Plan to ensure an inclu-

sive and equitableshift towards a sustainable

economy; and (3)the integration of just tran-

sition issues and the promotion of green jobs in

national frameworks and policies.

Implementing the Guidelines for a just transition in Uruguay and the Philippines

Box 2.7

56 World Employment and Social Outlook 2018 – Greening with jobs

C. Green enterprises: Key actors in the transition

Enterprises can lead the way to the green economy

Enterprises are the principal source of economic growth and employment (ILO, 2017). They are

key actors in guiding and sustaining the transition to a low-carbon and resource-efcient economy

as they are sources of innovation, adoption of new technologies, nancing, strategic outlooks, con-

tracts throughout the value chain and know-how to address environmental challenges (ILO, 2013a;

ITC-ILO, 2016). This role has been acknowledged by the international community, for example through

the Sustainable Stock Exchange Initiative (SSE, 2016) and the ILO’s Green Jobs and Sustainable

Enterprises programmes (ILO, 2013a; ITC-ILO, 2016); and businesses themselves, for example through

the World Business Council for Sustainable Development (WBCSD, 2010) and certication schemes

like B-corps (Chen and Kelly, 2015).

This section highlights how enterprises benet from a stablenatural environment and face risks arising

out of environmental degradation. It shows what it means for enterprises to become green and how

sustainability makes business sense, with implications for the entire value chain and specic challenges

for micro-, small and medium-sized enterprises (MSMEs). However, although the voluntary action taken

by enterprises so far is welcome, it is not enough to ensure environmental sustainability, which suggests

that governments need to provide overall direction, targets, guidance, incentives, norms, monitoring

and enforcement (Gunningham and Holley, 2016). As discussed in Chapter3, social dialogue and

collective agreements can help enterprises embrace sustainability.

Enterprises benet from a stablenatural environment

Enterprises benet from a predictableand sustainable natural environment and from being sustainable

enterprises themselves (ILO, 2007). As noted in Chapter1, environmental degradation can lead to

the loss of the ecosystem services that sustain economic activity. Ecosystem services are in practice

enterprise inputs, many of which are not priced. Moreover, human-induced climate change increases

the occurrence and strength of natural hazards, which create uncertainty for businesses and drive up

direct costs through the disruption of operations and supply chains. These costs are in addition to those

borne by enterprises in relation to land conversion, land degradation, water availability, biodiversity loss,

chemical exposure and waste.

For example, and only in terms of environmental issues related to water, over half of the companies

surveyed by the Carbon Disclosure Project (CDP) in 2016 experienced higher operating costs due to an

increase in energy and water costs associated with droughts, or received nes and penalties associated

with the non-sustainable use of water (CDP, 2016a).

In deforestation-related activities, four out of ve

companies surveyed had experienced impacts related to forest-risk commodities, which affected oper-

ations, revenue or expenditure over the past ve years. Deforestation has also become a key concern

for companies engaging directly or indirectly in the production and trade of soy, palm oil, timber and

cattle. Their reliance on deforestation to expand production can contribute to habitat loss, GHG emis-

sions and social conict, exposing suppliers and customers to negative perceptions (CDP, 2016b). In

view of their concerns at the effects of an unstableenvironment on their business, large multinational

companies from the technology, food, oil, chemical, pharmaceutical, retail, consumer goods, electricity

and mining sectors have voiced support for the Paris Agreement (C2ES, 2017).

18. The Carbon Disclosure Project (CDP) water programme surveyed 1,252 of the largest companies to gather information on

their efforts to manage and govern freshwater resources. The companies were selected from the MSCI All Country World Index.

Around half of the targeted companies (607) responded to the questionnaire (CDP, 2016a). The CDP forest programme surveyed

821 global companies to gather information on how they manage and mitigate risks associated with the sourcing or production

of four commodities responsible for deforestation (timber products, palm oil, soy and cattle products). Roughly a quarter of the

companies (201) replied to the questionnaire (CDP, 2016b).

19. On 26 April 2017, Apple, BHP Billiton, BP, DuPont, General Mills, Google, Intel, Microsoft, National Grid, Novartis Corporation,

PG&E, Rio Tinto, Schneider Electric, Shell, Unilever and Walmart addressed an open letter to the President of the United States

urging the country to remain a party to the Paris Agreement. The companies recognize the costs of climate change and the

economic and employment opportunities of a green economy. They argue that the Paris Agreement offers a stable and practical

framework that allows them to compete and plan future investment and reduce future climate impacts (C2ES, 2017).

2. Employment in a green economy 57

Environmental degradation brings increased risk for enterprises

Table 2.5 draws on UNEP (2013) to outline the implications of current environmental trends for busi-

ness. Although some market opportunities arise from environmental degradation (for example, for

enterprises engaged in the restoration of degraded land), the majority of impacts run counter to the

interests of most enterprises.

Enterprises recognize these risks to their operations, revenues or expenditures. They also identify

opportunities to embrace the transition to low-carbon and resource-efcient economies. CDP data

relating to climate change suggest that in 2016 practically all enterprises recognize the risks and

opportunities arising out of climate change regulation, climate change physical parameters or other

climate-related developments. This was not necessarily the case in 2010, when only around 80per

cent of the enterprises recognized the risks and opportunities (gure2.4).

The business implications of environmental degradation

Environmental trend Implications for business

Increase in greenhouse gas

emissions and climate change

Market shifts favouring lower-carbon products; operational and supply chain disruptions; higher cost of energy, food

and other commodities; shifting production and transport patterns to adapt to local conditions

Increased occurrence of severe

weather events

Operational and supply chain disruptions; increased cost of operations and materials; damage to shared public

infrastructure; increased demand for reconstruction services

Land conversion New and growing markets arising out of urban expansion; restricted access to land-based resources; loss of

ecosystem services; competition for arable land; increasing pressure to protect critical natural resources

Reduced water availability New markets for water-efcient products; constraints on growth due to water scarcity; operational and supply chain

disruptions; conicts with other stakeholders over limited supply of water; increasing cost of water

Increased water pollution Increased demand for pollution control devices and systems; increased cost of water treatment; stricter water quality

regulations; increased demand for health-care services to treat health impacts

Biodiversity loss Increased market, reputational and regulatory pressure to reduce biodiversity impacts; increased cost and reduced

availability of scarce resources; reduced opportunity for new product breakthroughs; limitations on access to land

Increased chemical exposure Market shift towards environmentally sustainable products; product use restrictions; regulatory, customer and public

pressure for greater transparency

Increased waste Growing market opportunities to recover/reuse e-waste and other forms of waste; increasing regulatory and customer

pressure to reduce/manage waste; reputational damage resulting from uncontrolled waste

Increased work accidents

anddiseases

Higher cost of employment injury benets and contributions due to workers’ compensation

Source: ITC-ILO, 2016, based on UNEP, 2013.

Table 2.5

100

Firm indentifying

at least one risk

Firm identifying

at least one opportunity

2010 2015

Firms identifying at least one opportunity or risk from climate change, 2010–15 (percentages)

Figure 2.4

Notes: Results based on 760 enterprises with information in FactSet reporting to CDP in 2010 and 2015. Appendix 2.3 provides

more information about the rms in the sample. Enterprises were asked about the existence of climate change-related risks and

opportunities arising out of: (i) physical climate parameters; (ii)regulatory changes; and (iii) other climate-related developments.

These include, for example: (i) changes in natural resource availability and rain and temperature patterns; (ii) carbon taxes,

energy taxes, emission trading schemes, emissions regulations and international agreements; and (iii) changing consumer

behaviour and uctuating socio-economic conditions.

Source: ILO calculations based on CDP 2015 data.

58 World Employment and Social Outlook 2018 – Greening with jobs

For rms, going green implies adopting green products,

green services and/or green processes and technologies

To grasp the opportunities associated with the transition to a green economy, enterprises need to adopt

sustainable business models, which in turn requires consideration of a triple-bottom-line approach in

which social and environmental outcomes complement a prot-only strategy (Bocken etal., 2014).

Enterprises that consider the three outcomes jointly are oriented towards the production of goods

and services that actively promote environmental sustainability (green goods and services) and/or the

adoption of environmentally sustainable processes (green processes) (ILO, 2013a; ITC-ILO, 2016).

Environmental management systems, such as ISO 14000 and the European Union Eco-Management

and Audit Scheme (EMAS), can guide enterprises in the adoption of green processes (ITC-ILO, 2016).

Moreover, the adoption of blockchain technology can sustain trust, ensure traceability and advance

enterprises and production towards sustainability in certain sectors like mining, agriculture, shing and

forestry (Chapron, 2017).

Enterprises have begun to decouple their growth from GHG emissions. In the same way as for countries

(see Chapter1), growth in the economic activity of enterprises does not need to be associated with

more emissions. As further elaborated below, this is because sustainability makes business sense.

Some 760 enterprises disclosed their emissions to the CDP in 2010 and 2015, and their sales and

employment information is available in FactSet.

Of these 760 rms, 22per cent have decoupled

and have achieved sales growth and a reduction in their GHG emissions (gure2.5). However, the

economic activity of a large number of enterprises remains coupled to emissions. For 31per cent of

these enterprises, sales growth was accompanied by an increase in GHG emissions, while 28per cent

experienced a decline in sales alongside a reduction in emissions.

Embracing environmental sustainability makes business sense

A key debate concerns the extent to which a shift to environmental sustainability can be complemen-

tary with current models of enterprise protability or requires alternative business models. For some, all

the efforts made, although welcome, will ultimately fail if they do not reect positively on the bottom line

and promote prots (Unruh etal., 2016). Indeed, enterprises need the appropriate price signals, regu-

lations and mandates to embrace sustainability (Strand and Toman, 2010). Today, going green makes

20. Appendix 2.3 provides more information on the CDP, FactSet and the types of enterprises covered by the two surveys by

sector, size and region.

21. The fact that some companies experienced a reduction in sales growth with an increase in GHG emissions could be driven

by capital-intensive rms, as their energy demands may be less dependent on sales.

31% 22% 28% 19%

Coupled sales growth

Decoupled sales growth

Coupled sales decline

Decoupled sales decline

100

Firms that decoupled GHG emissions from sales growth, 2010–15

Figure 2.5

Notes: Firms that have coupled sales growth are those which increased sales and GHG emissions. Firms that had decoupled

sales growth are those that increased sales while reducing GHG emissions. Firms that had coupled sales decline experienced a

decline in sales and GHG emissions. Firms that had a decoupled sales decline experienced a decline in sales with an increase in

GHG emissions. Results based on 760 enterprises with information in FactSet reporting to CDP in 2010 and 2015. Appendix2.3

provides more information about the rms in the sample.

Source: ILO calculations based on CDP 2015 and FactSet.

2. Employment in a green economy 59

business sense (Unruh etal., 2016), particularly as sales of consumer goods from brands committed

to sustainability are growing faster than those of other brands, and an increasing share of consumers

are willing to pay more for sustainable products (Nielsen, 2015).

Decoupling growth from GHG emissions does not limit the ability of enterprises to grow. Between 2010

and 2015, companies that decoupled sales growth from GHG emissions achieved an annual rate of

sales growth of 4.1per cent and an annual rate of employment growth of 2.7per cent. However, com-

panies that coupled sales growth with GHG emissions over that period grew faster in terms of sales

and employment, at around 7per cent (gure2.6).

Nevertheless, it is likely that, over the long term,

coupled rms will experience slower growth as a result of more volatile energy prices, as can be seen

from the benets that enterprises derive from embracing sustainability and the fact that coupled rms

which saw sales decline experienced a strong decline in both sales and employment (gure2.6).

In the long term, sustainability reduces risks, lowers the cost of capital and improves revenue per-

formance and operational efciency (ITC-ILO, 2016). The Ellen MacArthur Foundation (2013) shows

how embracing a circular mode of production provides short-term cost benets, new prot tools and

long-term strategic opportunities. Enterprises that adopt a circular model of production should expect

reduced material bills and warranty risks, improved customer interaction and loyalty, less product

complexity and more manageable product life cycles. Major enterprises have adopted the circular

economy. For example, 36per cent of the total mass of a new car produced by a major French auto

manufacturer is made from recycled materials and 85per cent of such a new vehicle is recyclable

when it reaches the end of its life (Ellen MacArthur Foundation, 2017). The Government of Scotland

(2016b), in collaboration with stakeholders, has outlined a framework to promote waste prevention and

design for longer product lifetimes, reuse, repair and recycling.

The available technology and infrastructure means that investing in clean processes is now cost

effective (Ellen MacArthur Foundation, 2013). For example, investing in green products and services

and green processes makes business sense in the context of GHG emissions reductions. Of the

enterprises reporting to the CDP in 2015, 1,839 were implementing 5,929 initiatives to reduce GHG

emissions, involving an overall investment of current US$ 103.9 billion. Initiatives include, but are not

22. The results in gure2.6 remain largely unchanged after taking into account the industry, region, age and size of enterprises

through regression models.

–10

Sales GHG emissions Employment GHG intensity growth

6.9

4.1

–5.4

–4.4

11.2

–5.6

–7.8

12.8

6.8

2.7

–3.3

0.3

4.2

–9.0

–2.4

18.4

Coupled sales growth

Decoupled sales growth

Coupled sales decline

Decoupled sales decline

Change in sales, GHG emissions and employment for coupled and decoupled rms, 2010–15

Figure 2.6

Notes: Firms that have coupled sales growth are those which increased sales and GHG emissions. Firms that had decoupled

sales growth are those that increased sales while reducing GHG emissions. Firms that had coupled sales decline experienced a

decline in sales and GHG emissions. Firms that had a decoupled sales decline experienced a decline in sales with an increase in

GHG emissions. Results based on 760 enterprises with information in FactSet reporting to CDP in 2010 and 2015. Appendix2.3

provides more information about the rms in the sample.

Source: ILO calculations based on CDP 2015 and FactSet data.

60 World Employment and Social Outlook 2018 – Greening with jobs

restricted to, measures to increase the energy efciency of manufacturing processes, transportation

or buildings, or installing low-carbon energy sources. For more than 60per cent of the enterprises,

the investment is paid back in less than three years, and for 80per cent of them the payback period

is less than ten years. Payback is a result of both savings and the sales growth associated with the

investment (gure2.7).

The potential to reap greater business benets is high

and applies to the entire value chain

Investors are increasingly recognizing the business case for going green. They also see sustainability

as an indicator of effective management. Three-quarters of investors consider sustainability to be ma-

terially important when making business decisions (Unruh etal., 2016).

The business case for going green goes beyond specic enterprises and comprises the whole supply

chain. Businesses engaging in environmentally sustainable practices should consider their dual role as

producers and consumers (ITC-ILO, 2016). Golicic and Smith (2013) nd that enterprises that require

environmentally sound practices from their suppliers achieve better performance.

Although the business case for adopting environmentally sustainable practices is clear for the ma-

jority of enterprises and is valued by investors, enterprises tend to believe that investors are not very

interested in sustainability performance (Unruh etal., 2016). Even though the great majority (90per

cent) of the enterprises surveyed believe that adopting a sustainability strategy is important to remain

competitive, only 60per cent have adopted such a strategy in practice, and only a quarter explicitly

point out the business case of adopting sustainability. A perceived lack of consumer demand for such

action, the difculty of quantifying the intangible effects of sustainability in cost–benet analyses,

short-term thinking in planning and budgeting cycles and insufcient resources all limit the capacity of

enterprises to address sustainability issues more robustly (ibid.). Public policy, through price incentives

and regulation, can help to ensure that all enterprises embrace sustainability.

This mismatch between attitudes and practice regarding sustainability is also seen in relation to en-

vironmental risks, which may be perceived as individual risks, and not part of an enterprise’s com-

prehensive risk management strategy (CDP, 2016b). Chapter3 examines how engagement with trade

unions, social dialogue and collective agreements can promote the adoption of sustainability strategies

by enterprises.

Percentage of initiatives

< 1 year 1–3 years 4–10 years 11–15 years 16–20 years 21–25 years > 25 years

Payback period for initiatives to reduce GHG emissions

Figure 2.7

Note: Percentages calculated on the basis of 5,929 initiatives listed in the CDP 2015 database by 1,839 rms.

Source: ILO calculations based on CDP 2015 data.

2. Employment in a green economy 61

When public efforts to support the transition have lagged behind (the top-down approach), enterprises

can take the lead in supporting the transition (the bottom-up approach). For example, despite the

steps taken to decarbonize the Australian economy in the early 2000s, public efforts have recently

weakened. In this context, some corporations have themselves taken the initiative of moving away

from coal-based energy. Illustrations include a utility company in Australia and its plan to decarbonize

electricity generation by 2050, the efforts made by an Australian solar power manufacturer to recon-

vert the coal-producing Latrobe Valley into a hub for the manufacture and recycling of batteries, and

an Australian company, which offers homeowners a business case to install solar panels and sell the

electricity to tenants (Huon etal., forthcoming).

Micro-, small and medium-sized enterprises face specic

challenges in embracing sustainability

Most research, attention and initiatives focus on large corporations. Indeed, targeting large corpor-

ations is effective for now, as action by a few enterprises can go a long way in reducing emissions and

environmental degradation, particularly if the action involves their entire value chain. The 1,839 rms

reporting to CDP in 2015 account for around 11per cent of global emissions.

However, micro-, small and medium-sized enterprises (MSMEs) account for over 90per cent of

enterprises throughout the world and, although their individual energy consumption may be small

(and, by extension, their individual emissions and environmental impact), their collective impact is

considerable. Together, MSMEs consume over 13per cent of total global energy production (IEA,

2015b). MSMEs tend to be slower to embrace environmentally sustainable processes or to shift to

the production of green goods and services. The IEA (2015) emphasizes that energy efciency may

be the most effective way for MSMEs to reduce their GHG emissions with relatively little or no invest-

ment. MSMEs are particularly relevant to advance environmental sustainability and promote formal

employment in rural economies.

The engagement of MSMEs with environmental sustainability is limited by the additional costs, lower

awareness, voluntary practices that do not result in direct business benet and the perception that

customers are not interested in their environmental impact (Aykol and Leonidou, 2015; Hillary, 2000).

Indeed, even if sustainable management tools exist for MSMEs, they are rarely taken up (Johnson

and Schaltegger, 2016). The lower access to nance of MSMEs compared with larger rms usually

limits their ability to grow and to adopt environmental practices (Hoogendoorn, Guerra and van der

Zwan, 2015). Informality can be another limitation for MSMEs, for example by excluding them from

public incentives (such as subsidies to adopt energy efciency) and their workers from training and

skills development programmes, as well as by precluding social dialogue. As further examined in

Chapters3 and5, social dialogue and skills development are key elements in facilitating a just tran-

sition to environmentally sustainable societies. The Transition from the Informal to the Formal Economy

Recommendation, 2015 (No.204), contains guidance that can help countries to adopt policies to

facilitate this step.

The cooperative business model is well positioned to play a role in addressing some of the challenges

in the renewable energy industry, particularly through community-driven initiatives supporting access

to affordable and clean energy sources for all. Cooperatives have a number of competitive advantages

in the production, provision and distribution of energy, including democratic control by the commu-

nities over energy production and use, the capacity to create local employment and promote local

development, and reasonable pricing (ILO, 2013c). Energy cooperatives responding to the demands for

democratizing energy production and distribution are prevalent in countries across the world, ranging

from rural electricity cooperatives in Costa Rica and Bangladesh and biomass production plants in

Brazil and Finland to photovoltaic cooperatives in Denmark and Argentina.

The positive momentum needs to be strengthened

Large enterprises have adopted several tools to drive action to reduce their GHG emissions. These

include voluntary internal carbon pricing mechanisms, participation in emissions trading schemes and

broader investment strategies to reduce emissions. These efforts are generally set against self-deter-

mined emissions reduction targets. But these targets, even if they are met, only constitute one-quarter

62 World Employment and Social Outlook 2018 – Greening with jobs

of the emissions reductions needed from these rms to achieve the 2°C goal set by the international

community, also falling short of the 1.5°C goal. Self-determined targets only amount to one-tenth of

potential emissions reductions by the private sector as a whole (CDP, 2016c). Macroeconomic pol-

icies (ILO, 2015) and infrastructure investment (OECD, 2017) can provide the necessary price signals,

incentives, regulation and business environment to improve the measures taken and to achieve the

1.5°C or the 2°C goal.

Policies are needed if enterprise action is to bear fruit. During the 1990s, reliance on information dis-

closure, social licences and price signals to guide prot-seeking activity and other voluntary schemes

offered only limited incentives for enterprises to adopt environmental practices. Smart regulation

can enhance the motivation of current businesses to achieve sustainability, and stimulate the ne-

cessary motivation in other cases (Gunningham and Holley, 2016). In the United States, a US$ 40 tax

perCO

eqton emitted, coupled with border tax adjustments, could help to meet the Paris Agreement

target, reduce the burden of emissions regulation and improve the well-being of most citizens (Bailey

and Bookbinder, 2017; Baker etal., 2017). As further examined in Chapters3, 4 and5, pricing ex-

ternalities and ecosystem services, environmental regulation, social protection, skills and access to

nance can pave the way for rms, and the economy as a whole, to go green.

Conclusions

Chapter1 showed that, from the perspective of the world of work, the transition towards a low-carbon

and resource-efcient economy is urgent. This chapter shows that achieving environmental sustain-

ability can lead to an economy that offers more jobs. Though there is sectoral reallocation, achieving

sustainability does not destroy jobs at the level of the whole economy. Net job creation is expected if

sustainability is embraced in the energy sector and by adopting some tenets of the circular economy.

It shows that there is a sound business case for enterprises to adopt sustainability. Like Chapter1, this

chapter also demonstrates that the SDGs that promote environmental sustainability can be compatible

with food security (SDG2), clean energy (SDG7) and decent work for all (SDG8).

Indeed, around 18million jobs are expected to be created if, by 2030, there has been a transition in

energy use towards greater efciency and energy is sourced from renewables, as opposed to fossil

fuels, in line with the IEA scenarios, if electric vehicle sales meet projections and any savings in energy

efciency are used to invest in building’s energy efciency. This net job creation masks an important

restructuring of the economy, with employment losses expected in the fossil fuel sectors and related

industries, and in regions that are heavily dependent thereon.

A similar transformation will affect the entire economy if agriculture embraces sustainability, with the

effects depending on the sustainability path adopted. For some regions, particularly in developedcoun-

tries, a transition may involve embracing organic agriculture. For others, particularly in developing

countries, a decent work friendly and food security friendly sustainability path may mean adopting

conservation agriculture. In either case, complementary policies will be needed to ensure that these

changes enhance decent work in the agriculture sector and that any employment losses can be used

as an opportunity to guide the structural transformation in developing countries.

Moreover, the redistribution of economic activity and jobs will affect different sectors, as sustainability

in one sector affects the chain of inputs. While this is true for all forms of sustainability, this is clearly

seen in the employment changes associated with the adoption of a circular economy. By replacing

the extraction of resources and the manufacture of goods for ownership by the reuse, repair, recycling

and renting of goods, employment will move away from extraction and manufacturing into repro-

cessing, waste management and services. Overall, these ndings suggest that the achievement of

a green economy can enhance employment opportunities. They also emphasize that the transition

requires support for workers, industries and regions from which employment opportunities are dis-

placed. This support needs to be accompanied by incentives to ensure that they too put their weight

behind the transition.

2. Employment in a green economy 63

The transition requires global collaboration across countries, enterprises and workers. The intercon-

nectedness of global supply chains means that consumption and production in one country embed

the emissions and materials used in others (Tukker etal., 2014), resulting in regions being affected

differently. Also, as indicated in Appendix 2.2, many environmental challenges are global, including

climate change, even though their causes may be limited to a few countries and sectors, and their

effects will mostly be felt over the medium to long term, with little incentive to act in the present. The

transition requires the re-thinking of production and consumption patterns and, to a certain extent,

social organization and solidarity (Maxton and Randers, 2016). Indeed, workers and enterprises have a

key role to play in the transition, through green jobs, innovation, the adoption of new technologies and

modes of production, investment and standard-setting. Progress in this area is already visible, but is

yet not sufcient, which signals the need for an integrated policy framework to accelerate the transition

by workers and enterprises alike. Chapters3, 4 and 5 examine in greater depth the legal framework,

social protection tools and skills policies required to achieve this global transformation.

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3. Regulatory frameworks: Integration, partnerships and dialogue 71

KEY FINDINGS

International labour standards (ILS) provide a regulatory framework for the social pillar of

the green economy and help ensure decent work practices in sectors affected by the green

transition. In addition, ILS protect the environment. On the one hand, they do so indirectly

through the protection of workers and the working environment, as is the case of standards

on occupational safety and health (OSH), for example. On the other hand, certain ILS address

environmental issues directly. These include the Indigenous and Tribal Peoples Convention,

1989 (No.169), which requires environmental impact assessments, the Prevention of Major

Industrial Accidents Convention, 1993 (No.174), and the Employment and Decent Work for

Peace and Resilience Recommendation, 2017 (No.205).

Labour dimensions such as environmental rights at work, employment protection and promo-

tion, and in particular occupational safety and health are being increasingly integrated into

multilateral environmental agreements (MEAs).

National environmental legislation and policies have begun to include labour issues. For ex-

ample, a review of climate change policies in 26 countries shows that in 19 of them these pol-

icies include labour issues. In particular, climate change policies include the promotion of skills

and training, as well as setting job creation as a formal objective or as an outcome of climate

change adaptation and mitigation measures. Sectoral legislation also includes employment and

decent work concerns. Indeed, out of 40 countries whose energy legislation was analysed, in

different regions and at different levels of development, 27 include labour issues such as skills

development and training.

Both developed and emerging countries have enacted legislation and policies to foster the

“greening” of jobs, but this has also been done in developing countries. A recent analysis of

16countries in sub-Saharan Africa shows that legislation linking labour and environmental

issues has been adopted increasingly since the early 2000s, particularly in relation to renew-

able energy and waste management.

Social dialogue is a valuable tool for advancing towards a just transition. At the international

level, green issues, together with labour standards, have become the subject of social dialogue

between multinational enterprises and global union federations in International Framework

Agreements. At the national level, social dialogue has contributed to making environmental

governance more labour-friendly, for instance through collective agreements.

There is emerging consensus on the regulatory and policy framework needed to facilitate the

interaction between the environmental and the decent work agenda, but it is too early to pin-

point obstacles to further progress.

Regulatory frame-

works: Integration,

partnerships

and dialogue

72 World Employment and Social Outlook 2018 – Greening with jobs

Introduction

It is undeniable that, to be just, a transition to a low-carbon economy needs to take into account decent

work and social justice. This premise has been reinforced by the UN 2030 Agenda for Sustainable

Development, as well as the Paris Agreement. In the preamble to the latter, the Parties recognize the

“imperatives of a just transition of the workforce and the creation of decent work and quality jobs in

accordance with nationally dened development priorities”.

There is currently no distinct area of law dealing with green jobs. While legal researchers have re-

cently started exploring the possibility of a “just transition law” in the framework of environmental

sustainability, they have also acknowledged that its emergence is still distant (Doorey, 2017).

Rather,

what exists is two separate branches of standards and policies within the elds of labour and the en-

vironment.

Chapters1 and 2 have examined the rationale behind the need for a transition to environmentally

sustainable economies and provided evidence of its job creation potential. This chapter focuses on

analysing existing international rules and instruments which form part of the policy options available

for the process of a “just transition”.

The chapter rst looks at international instruments on labour and environmental matters. It reviews

international labour standards (ILS), based on their broad acceptance and universal relevance, as a

means of promoting and ensuring decent working conditions in sectors most affected by the transi-

tion.

Multilateral environmental agreements (MEAs) are also examined with a view to identifying the

labour issues that they incorporate, principally occupational safety and health (OSH) (section A). The

chapter then analyses how the process of the integration of labour and environmental laws has taken

place at the national level. It reviews and compares the links between environmental legislation and

policies with labour considerations in 52 countries (section B). Finally, it discusses the role of social

dialogue as a means to a just transition towards environmentally sustainable economies and societies

for all and examines the different ways in which the social partners have contributed to the process of

greening (section C).

1. Nevertheless, a “just transition law” would “provide a framework for organizing a coherent body of law”, including aspects of

other legal elds, including labour and environmental law (Doorey, 2017).

2. ILS are legal instruments developed by governments and the representatives of employers and workers, the ILO’s constituents,

which establish basic principles and rights at work. They mainly take the form of Conventions, Protocols and Recommendations

(ILO, 2014).

3. Regulatory frameworks: Integration, partnerships and dialogue 73

A. Integration of environmental protection

and labour issues at the international level

This section examines the role of international labour standards (ILS) in a just transition. Analysis

of the structure of ILS identies that the entire body of standards found in ILO Conventions and

Recommendations is relevant to the green transition. In addition, at least 11 ILO instruments contain

express references to environmental concerns. As the section demonstrates, ILS can also contribute

to implementing principles of sustainable development, and therefore contribute to dealing with the

environmental impact of the world of work and framing responses to environmental challenges.

INTERNATIONAL LABOUR STANDARDS RELEVANT

TO THE PROCESS OF GREENING WITH JOBS

International labour standards ensure a just transition to a green economy

As yet there is no specic international labour standard on a just transition.

However, the tripartite

Guidelines for a just transition towards environmentally sustainable economies and societies for all,

noted by the ILO Governing Body at its 325th Session in 2015, set out the roles of the ILO’s constituents

and provide a non-exhaustive list of ILO instruments relevant to the just transition framework and cov-

ered in this chapter.

As the Guidelines point out, international labour standards offer a framework for

addressing most of the issues associated with the greening of the economy and, more broadly, with the

transition towards sustainable development. In view of their universality and exibility, ILS are relevant to

all workers, sectors and workplaces, including emerging green sectors.

ILS therefore contribute to the

regulatory framework of the green economy’s social pillar and can promote decent working conditions

in green sectors. Additionally, ILS deal with issues that have environmental ramications, such as lack

of employment and adequate standards of living, and also provide a legal framework for skills relevant

for the green transition, as further analysed in Chapter5.

Certain specic ILS, and particularly the fundamental and governance Conventions,

make an overall

contribution to the regulation of the labour market. They also act as a tool for the social partners to

address the challenges posed for the workplace and employment in general by the process of greening

(Olsen, 2009). For example, the Freedom of Association and Protection of the Right to Organise

Convention, 1948 (No. 87), and the Right to Organise and Collective Bargaining Convention, 1949

(No.98), provide guidelines on how to ensure participation in decision-making related to environmental

and climate change policies affecting the world of work.

Impacts of climate change on livelihoods and labour markets have increasingly drawn attention

(and sometimes alarm) to the prospects of cross-border human displacement (Kagan etal., 2017).

Recognizing the importance of protecting the rights of migrant workers as essential to social justice

in the world of work,

the ILO has adopted a number of standards on, or affecting, migrant workers

(Rodgers etal., 2009). These standards include the Migration for Employment Convention, 1949

3. A proposal was made to include an item on the agenda of the International Labour Conference with a view to the adoption of

a standard on a just transition. It was argued that such an instrument would provide the Guidelines with “force and authoritative

guidance” and that it would be a means for the International Labour Conference and the Governing Body “to monitor the imple-

mentation of social and labour issues in relation to environmental change and related policies”. So far there is no consensus on

this question among the ILO’s tripartite constituency. Irrespective of the adoption of an instrument on this issue, the Guidelines

are starting to be implemented, as seen in Chapter2.

4. ILO, 2017a, Appendix I.A, indicates that the governance structures of the climate change regime are not sufcient to address

the needs and realities of the world of work, and that the International Labour Conference is the body that is best placed to “com-

plement the global policy framework on environmental matters”.

5. On universality and exibility, see e.g. Valticos (1979); Von Potobsky and de la Cruz (1990); ILO (2014); Servais (2017).

6. The eight fundamental Conventions are: the Freedom of Association and Protection of the Right to Organise Convention,

1948 (No.87); the Right to Organise and Collective Bargaining Convention, 1949 (No.98); the Forced Labour Convention,

1930 (No.29); the Abolition of Forced Labour Convention, 1957 (No.105); the Minimum Age Convention, 1973 (No.138);

the Worst Forms of Child Labour Convention, 1999 (No.182); the Equal Remuneration Convention, 1951 (No.100); and the

Discrimination (Employment and Occupation) Convention, 1958 (No.111). The four governance Conventions are: the Labour

Inspection Convention, 1947 (No.81); the Employment Policy Convention, 1964 (No.122); the Labour Inspection (Agriculture)

Convention, 1969 (No.129); and the Tripartite Consultation (International Labour Standards) Convention, 1976 (No.144).

7. Constitution of the International Labour Organisation, as modied by the Instrument of Amendment of 1972 (entry into force:

1 November 1974).

74 World Employment and Social Outlook 2018 – Greening with jobs

(No.97), and the Migrant Workers (Supplementary Provisions) Convention, 1974 (No.143), and apply

to workers who are forced from their homes and across borders as a result of climate change and

natural disasters.

More recently, the ILO adopted the Employment and Decent Work for Peace and Resilience

Recommendation, 2017 (No.205), which contains measures specically related to recovery and

building resilience in response to crisis arising from environmental and climate-related disasters.

The need for a just transition towards an environmentally sustainable economy is one of the guiding

principles and proposed strategic approaches of this Recommendation. Although Recommendation

No.205 consolidates the main principles related to building resilience to climate-induced disasters, it

is important to note that a much wider range of ILS are relevant to climate adaptation and mitigation

policies (table3.1).

International labour standards relevant to climate adaptation and mitigation policies

Adaptation policies Mitigation policies

Climate change induced stress at work:

• Hazardous air quality: C148 (Working Environment);

• Measures to cope with heat and other stress at work: C110

(Plantations), R116 (Reduction of Hours);

• Occupational safety and health: C155 & P155 (OSH),

C187 (Promotional Framework for Occupational Safety and

Health), C161 (Occupational Health Services).

Enhancement of adaptive capacity:

• Poverty reduction: various ILS, including on fundamental

rights at work, employment, social security, OSH;

• Improving education/knowledge and skills: C140

(Paid Educational Leave), C142 (Human Resources

Development); C155 & P155 (OSH);

• Promoting rights of groups vulnerable to the climate

change: C111 (Discrimination), C159 & R168 (Vocational

Rehabilitation and Employment (Disabled Persons)),

C183 (Maternity Protection), C169 (Indigenous and Tribal

Peoples).

Compensation and protection of workers in affected sectors:

• Unemployment: C102 (Social Security (Minimum

Standards)), C168 (Employment Promotion and Protection

against Unemployment);

• Compensation for the victims of pollution/environmental

damage: R181 (Prevention of Major Industrial Accidents);

• Compensation for removal from traditional lands: C169

(Indigenous and Tribal Peoples);

• Minimum levels of benets to workers facing an accident

or illness related to work: C121 & R121 (Employment

Injury Benets), R202 (Social Protection Floors).

Prevention of damage to the environment:

• Prevention and protection measures: C162 & R172

(Asbestos); C176 (Safety and Health in Mines); R192

(Safety and Health in Agriculture);

• Environmentally sound management of pollution and

waste disposal: C162 & R172 (Asbestos); C170 &

R177 (Chemicals); C184 & R192 (Safety and Health

inAgriculture);

• Environmental impact assessment: C169 (Indigenous

andTribal Peoples).

Climate-induced displacement (migration):

• Labour migration specic standards: C97 (Migration for

Employment); C143 (Migrant Workers); R100 (Protection of

Migrant Workers); R151 (Migrant Workers).

Reduction of greenhouse gas emissions:

• Agriculture: C184 & R192 (Safety and Health in

Agriculture);

• Mining: C176 & R183 (Safety and Health in Mines).

Measures to address disasters:

• Preparedness and response to industrial disasters: C174

(Prevention of Major Industrial Accidents);

• Preparedness and response to natural disasters and other

situations of crisis: R205 (Peace and Resilience).

Sectoral policy measures:

• Agriculture: C184 & R192 (Safety and Health in

Agriculture);

• Chemicals: C170 & R177 (Chemicals);

• Waste management: C170 & R177 (Chemicals); C184

&R192 (Safety and Health in Agriculture).

Diversication of economies and redress of inequality:

• Employment policy: C122 (Employment Policy), R189 (Job

Creation in Small and Medium-Sized Enterprises), R198

(Employment Relationship), R205 (Peace and Resilience);

• Skills: C140 (Paid Educational Leave), C142 (Human

Resources Development).

Sustainable patterns of production and consumption:

• Elimination/reduction of production processes that

may damage the environment, respect for ecological

thresholds, waste minimization: C148 (Working

Environment); C162 (Asbestos); C169 (Indigenous and

Tribal Peoples); C170 (Chemicals); C174 (Prevention of

Major Industrial Accidents); C176 (Safety and Health in

Mines); C184 (Safety and Health in Agriculture).

Note: C = Convention; R = Recommendation.

Source: ILO compilation.

Table 3.1

3. Regulatory frameworks: Integration, partnerships and dialogue 75

ILO instruments are also relevant to the structural transformation

of the economy and the protection of workers through social dialogue

As noted above, the fundamental and governance Conventions are particularly important in fostering

a just transition. In particular, the Freedom of Association and Protection of the Right to Organise

Convention, 1948 (No.87), the Right to Organise and Collective Bargaining Convention, 1949 (No.98),

and the Tripartite Consultation (International Labour Standards) Convention, 1976 (No.144), through

the promotion of social dialogue, play an important role in ensuring public participation and consult-

ation, which are crucial to sustainable development. Without these, societies cannot be inclusive,

equitableor democratic (Olsen, 2009 and 2010).

Other instruments that contain provisions giving a voice to the parties involved in the greening process

include the Rural Workers’ Organisations Convention, 1975 (No.141) and Recommendation (No.149),

which seek the organization of rural and agricultural workers, and indirectly benet migrant workers,

who are highly involved in agriculture.

Section C further discusses the role of the social partners and

social dialogue, and specic jointly agreed instruments, in facilitating the greening of the economy.

THE CONTRIBUTION OF ILS TO ENVIRONMENTAL PROTECTION

AND THE IMPLEMENTATION OF THE PRINCIPLES

OF SUSTAINABLE DEVELOPMENT

The role of ILS is not limited to the social dimension of the transition to a low-carbon society. Alongside

social and developmental aspects, outlined above, they also support and reinforce the environmental

pillar of the green economy and, more broadly, sustainable development.

Environmental issues are addressed in ILS in different ways. Some ILO instruments are more closely

linked, either directly or indirectly, to the protection and preservation of the environment (gure3.1).

The Indigenous and Tribal Peoples Convention, 1989 (No.169), is directly protective of the environment.

It strengthens the role of indigenous and tribal peoples in environmental management and sets out

a legal framework for environmental impact assessments.

It also provides that measures should be

taken to “protect and preserve the environment of the territories inhabited by indigenous peoples”.

Another instrument directly protective of the environment is the Employment and Decent Work for

Peace and Resilience Recommendation, 2017 (No.205). It should be noted that the Prevention of

Major Industrial Accidents Convention, 1993 (No.174), puts protection of the environment on an equal

footing with that of workers and the public.

In contrast, ILO instruments on occupational safety and health (OSH) address environmental chal-

lenges indirectly through the protection of workers. Some ILS on the control of hazards and accident

prevention also pursue both environmental and worker protection. Underlying this approach is the

idea that the deterioration of conditions in the working environment is among the main causes of

environmental pollution and the degradation of the human environment. This idea is reected in the

Resolution concerning the contribution of the International Labour Organisation to the protection and

enhancement of the environment related to work, adopted by the ILC in 1972.

The role of ILS in this

respect was seen as setting legal standards to prevent harm to the environment stemming from the

workplace. Standards, particularly on OSH, can contribute to the design of policy solutions in situations

of environmental degradation and to mainstreaming environmental concerns into the world of work.

As the following section demonstrates, OSH standards provide a signicant body of rules aimed at the

protection of the environment.

8. Some governments have provided support services to agricultural workers for environmental activities. For example, in Austria,

alternative energy and energy conservation have been included in such support services (ILO, 2015b).

9. Olsen (2009) explores a different classication of ILS that are directly and indirectly related to the climate change agenda.

10. Article 7(3) of the Convention provides that “[g]overnments shall ensure that, whenever appropriate, studies are carried

out, in co-operation with the peoples concerned, to assess the social, spiritual, cultural and environmental impact on them of

planned development activities. The results of these studies shall be considered as fundamental criteria for the implementation

of these activities.”

11. For a study of the ILO’s involvement in environmental matters, see Olsen and Kempter (2013).

76 World Employment and Social Outlook 2018 – Greening with jobs

Occupational safety and health: From worker protection to environmental protection

Although environmental concerns were initially addressed through the prism of worker protection, the

protection of the environment has steadily become an objective of its own in these standards (box3.1).

For example, the preparatory work, preamble, scheme and structure of the Chemicals Convention,

1990 (No.170), and the Prevention of Major Industrial Accidents Convention, 1993 (No.174), make it

clear that the objective of protecting the environment is pursued equally alongside worker protection.

OSH standards can promote the protection of the environment through rules on: (a)environmentally

sound management of pollution and waste disposal; (b)hazard control and accident prevention; and

(c)the protection of the environment through OSH in specic sectors.

12. The inclusion of considerations of environmental protection in ILS has not always been widely welcomed by some ILO con-

stituents. See, for example, ILO (1995) on safety and health in mines.

Direct protection of the environment

Environmentally

sound management

of pollution and

waste disposal:

C148; C176; C184;

R175; R192

Hazard control

and accident

prevention:

C162; C170; C174;

R172; R177

OSH in speciﬁc

sectors:

C176; R175;

R183; R192

ILS on

indigenous and

tribal peoples

C169

ILS related

to building

resilience:

R205

International labour standards relevant

to the protection of the environment

Indirect protection through protection

of workers (OSH standards)

The structure of ILS from an environmental protection perspective

Figure 3.1

Source: ILO compilation.

Environmental concerns were first intro-

duced into ILS in the context of, and in

relation to, the working environment. The

Working Environment (Air Pollution, Noise

and Vibration) Recommendation, 1977

(No.156), is the rst ILO standard to make

an explicit link between the protection of

the working environment and of the gen-

eral environment, which should be taken

into account by the competent authorities

(Paragraph 15).

As the working environment is not a closed

system isolated from the general en-

vironment, factors that give rise to a deteri-

oration in the working environment are also

among the main causes of the deterioration

in the human environment (ILO, 1987,

para.344). The workplace, as a source of risk

generation, is a place where primary control

should be exercised and where measures

should be taken to coordinate environmental

and labour protection (ibid., para. 345).

ILO instruments on hazard control and ac-

cident prevention in relation to the use of

hazardous substances and processes in

industry focus on potential risks emanating

from the working environment. They there-

fore provide a framework for further devel-

oping the principle of the inter-relationship

between the protection of the working

environment and the general environment

(ibid., para. 347).

The relationship between the working environment and the general environment

Box 3.1

3. Regulatory frameworks: Integration, partnerships and dialogue 77

(a) Environmentally sound management of pollution and waste disposal

The management of pollution and waste disposal is addressed by the Asbestos Convention,

1986 (No.162) and Recommendation (No.172), the Chemicals Convention, 1990 (No.170) and

Recommendation (No.177), and the Safety and Health in Agriculture Convention, 2001 (No.184) and

Recommendation (No.192). These instruments contain provisions that address unsustainable patterns

of production. Prevention, precaution and respect for ecological thresholds are important aspects of

all these instruments.

Thus, Article 19(2) of Convention No.162 requires that appropriate measures be taken by the com-

petent authority and by employers to prevent pollution of the general environment by asbestos dust

released from the workplace.

Recommendation No.172 further species measures to be taken and

encourages opting for environmentally friendly technologies and processes which reduce or eliminate

the formation of asbestos dust and its release (Paragraphs 17(c) and 28(2)).

Convention No.170 addresses environmentally friendly handling and disposal of hazardous chemicals

(Article 14).

Similarly, Convention No.184 and Recommendation No.192 contain provisions on the

sound management of chemicals in agriculture. Convention No.184, in particular, requires measures

to ensure there is a suitablesystem for the safe collection, recycling and disposal of chemical waste

and to eliminate or minimize risks to the environment. Environmentally sound management of waste

disposal in mining operations and construction is governed by Article 5(4)(d) of Convention No.176

and Paragraph 41(3) of Recommendation No. 175, respectively.

(b) Hazard control and accident prevention

In addition to the potential human and material losses, and injuries inside or outside the workplace,

an industrial disaster has an impact on the environment. The Prevention of Major Industrial Accidents

Convention, 1993 (No.174), requires member States to formulate, implement and periodically review a

coherent national policy concerning the protection of workers, the public and the environment against

the risk of major accidents, in consultation with the most representative organizations of employers

and workers, and with other interested parties who may be affected (Article 4(1)).

Additionally, the

Convention requires employers to establish and maintain a documented system of major hazard con-

trol, including emergency plans and procedures, for each major hazard installation (Article 9(d)(ii)).

Article 15, on the responsibilities of the competent authorities, requires them to “ensure that emergency

plans and procedures containing provisions for the protection of … the environment outside the site of

each major hazard installation are established, updated at appropriate intervals and coordinated with

the relevant authorities and bodies” (see box3.2).

Environmental protection is also integrated into several ILO standards on OSH in specic sectors, in-

cluding some of those most relevant for the transition towards sustainable economies, namely mining,

agriculture and construction. The Safety and Health in Mines Convention, 1995 (No.176), recognizes

that it is desirable to prevent any damage to the environment arising from mining operations. This prin-

ciple is further developed in its accompanying Recommendation No.183, which states that emergency

response plans developed by employers (in accordance with Article 8 of the Convention) could include

adequate protection of the environment (Paragraph 19(d)). The Recommendation adds that due regard

should be given to the possible impact of mining on the surrounding environment (Paragraph 33).

13. The Committee of Experts on the Application of Conventions and Recommendations (CEACR) has requested information

on the measures taken in law and practice in relation to work on land and on ships to give effect to the requirement to prevent

pollution of the general environment by asbestos released from workplaces. See, for example, Denmark–CEACR, Convention

No.162, direct request, published in 2012.

14. Recommendation No.177 adds two parameters: rst, that chemical safety data sheets for hazardous chemicals should also

contain ecological information (Paragraph 10(1)), and, second, that the “criteria for the use of chemicals at work … should be as

consistent as possible with the protection of the general public and the environment and any criteria established for that purpose”

(Paragraph 17).

15. The drafters of the instrument saw Convention No.174 as being designed to protect equally the public and the environment

as, in the view of some States, workers are protected by OSH standards (ILO, 1992).

16. Some measures of due diligence include the control of subsidence, vibration, yrock, harmful contaminants in water, air or

soil, the safe and effective management of waste tips, and the rehabilitation of mine sites (ibid.).

78 World Employment and Social Outlook 2018 – Greening with jobs

The Safety and Health in Agriculture Recommendation, 2001 (No.192), indicates that when im-

plementing the national policy on this issue, the measures adopted for the prevention and control

of occupational hazards should take into account the need to protect the general environment from

the impact of agricultural activities (Paragraph 3).

Similarly, the Safety and Health in Construction

Recommendation, 1998 (No.175), calls for the preservation of the environment to be safeguarded,

as prescribed by national laws and regulations, when materials are used that contain hazardous sub-

stances and in the removal and disposal of waste (Paragraph 41(3)).

The environment and the Indigenous and Tribal Peoples Convention, 1989 (No.169)

Convention No.169 is one of the two ILO instruments dealing with the environment directly. One of

its objectives is to reect the special relationship that indigenous peoples have with their land and

environment. As a general principle, the Convention stipulates that indigenous peoples have the right

“to the natural resources pertaining to their lands”, including the right “to participate in the use, man-

agement and conservation of these resources”. It sets out the general obligations of ratifying States,

including the adoption of measures, in cooperation with indigenous peoples, to protect and preserve

the environment of the territories that indigenous and tribal peoples inhabit (Articles 4 and7).

17. These measures should also protect the general environment from risks which may arise from agricultural activities (such as

agrochemical waste, livestock waste, soil and water contamination, soil depletion and topographic changes).

The comments of the Committee of Experts

on the Application of Conventions and

Recommendations (CEACR) on the im-

plementation of Convention No.174 have

highlighted the equal importance accorded

to the protection of the environment and to

the rights of workers and the public. For

example, when reviewing the application

of Article 4, the CEACR has recalled that

the focus of the Convention “is not only on

the management of accidents in such in-

stallations, nor on environmental law, but

on the management of major industrial

accidents to which not only workers, but

also the environment and the public are

exposed”.

It has also indicated that a na-

tional OSH policy is not sufcient to address

the objective and focus of the Convention,

as “neither labour legislation, nor environ-

mental legislation, is sufcient to give effect

to this Convention” and, in line with Article

4(1), there has to be a coherent national

policy concerning the protection of workers,

the public and the environment against the

risks of major accidents,

rather than frag-

mented or separate labour or environmental

regulation.

The CEACR has therefore em-

phasized the objective of the Convention

to protect “workers, the public and the en-

vironment”.

Through its direct requests, the CEACR has

raised a number of issues, including re-

questing information on the manner in which

risks to workers, the environment or the

public are taken into account in the applica-

tion of Article 6 in relation to the protection of

condential information;

and information on

the effect given to Article 15 on the establish-

ment and regular updating of off-site plans

and procedures to protect the environment

outside the sites of hazardous installations,

and the consultations held for this purpose.

Colombia–CEACR, Convention No.174, observation, published in 2014.

See also, for example, Brazil–CEACR,

Convention No.174, direct request, published in 2012.

Colombia, 2014, op.cit.

Brazil, 2012, op.cit.; Colombia–

CEACR, Convention No.174, direct request, published in 2012.

Saudi Arabia–CEACR, Convention No.174, direct

request, published in 2015; Colombia, 2014, op.cit.

Armenia–CEACR, Convention No.174, direct request, pub-

lished in 2014.

Zimbabwe–CEACR, Convention No.174, direct request, published in 2015.

Implementation of the Prevention of Major Industrial Accidents

Convention, 1993 (No.174): Recent CEACR comments

Box 3.2

3. Regulatory frameworks: Integration, partnerships and dialogue 79

The Convention also requires that environmental assessments be carried out on the possible impact

of planned development projects on the peoples concerned. The environment is considered to be an

inseparable component of the right of indigenous peoples to land, the use of natural resources and

their traditional life. Article 7 thus emphasizes the right of indigenous peoples to participate in the

formulation, implementation and evaluation of development plans which may affect them directly, and

species that the results of environmental assessments should be considered as fundamental criteria

for the implementation of development activities.

ILS contribute to the implementation of sustainable development principles

As the Guidelines for a just transition make clear, sustainable development provides the framework for

the transition at the global level (ILO, 2015a). Understanding the contribution of ILS to the principles of

sustainable development is helpful in that respect. The main points of convergence and contribution

of ILS to the implementation of sustainable development principles are set out in table3.2.

This equation of international labour standards with sustainable development leads to two substantive

conclusions. First, ILS contribute to the implementation of a broad range of sustainable development

principles. Olsen (2009) notes some of the linkages between sustainable development principles and

labour standards, such as the fact that OSH standards are based on the precautionary principle. As

table3.2 indicates, ILS contribute to the implementation of sustainable development principles in

matters such as control of hazardous activities and substances, environmental impact assessments,

integration of environmental, social and economic concerns, notication and assistance during emer-

gencies, prevention of environmental pollution, public participation in environmental matters, partici-

pation of ITPs in environmental management, reduction of GHG emissions, and sustainable patterns

of production and consumption.

Second, ILO instruments are also capable of broadening the scope of environmental protection, par-

ticularly in unregulated or insufciently regulated areas. In relation to hazardous substances, for ex-

ample, ILO instruments such as the Chemicals Convention, 1990 (No.170), and its accompanying

Recommendation (No.177), focus on waste disposal at the source of their production. This is in con-

trast to the Rio Declaration, which only addresses the transfer or relocation of substances that cause

severe environmental degradation, while other multilateral environmental agreements, analysed in the

next section,

regulate mainly the transboundary movement and trade in waste and other hazardous

substances (Mbengue, 2015).

Similarly, a series of ILO standards on OSH issues in specic sectors (such as mining, agriculture and

construction) include provisions on environmental protection. For instance, the Safety and Health in

Agriculture Convention, 2001 (No.184), requires environmentally sound collection, recycling and

disposal of chemical waste, obsolete chemicals and empty containers of chemicals in agriculture. This

is a normative contribution by ILS to environmental protection, as many industrial and other activities,

such as transport, mining, and energy generation, which may pose signicant long-term environmental

threats, “are not subject to signicant specic international environmental regulation” (Sands and Peel,

2012, p.516).

18. The Basel Convention on the Control of Transboundary Movements of Hazardous Wastes and their Disposal (1989) and the

Stockholm Convention on Persistent Organic Pollutants (2001), which goes further in addressing the international movement of

hazardous waste by directly limiting/regulating the production and use of hazardous chemicals known as persistent organic pollu-

tants; and the Minamata Convention on Mercury (2013), which provides for the phase-out of mercury mining.

19. For example, Article 4(2) of the Basel Convention requires States parties to take “appropriate measures” to reduce the gen-

eration of hazardous wastes to a minimum and to ensure the availability of adequate disposal facilities for their environmentally

sound management.

80 World Employment and Social Outlook 2018 – Greening with jobs

Contribution of international labour standards to the sustainable development normative framework

Sustainable development legal

principles and policy guidelines

International labour standards Methods set out in international labour standards

Capacity building and knowledge Human Resources Development Convention, 1975

(No.142); Occupational Safety and Health Convention,

1981 (No.155); Protocol of 2002 to the Occupational

Safety and Health Convention, 1981; Promotional

Framework for Occupational Safety and Health

Convention, 2006 (No.187) and Recommendation,

2006 (No.197)

• Skills necessary to meet changing methods of

production

• New skills to ensure safety in environmental jobs

Compensation for the victims

ofpollution/other environmental

damage

Prevention of Major Industrial Accidents

Recommendation, 1993 (No.181)

• Establishment of a system to compensate workers

following major accidents and adequately address their

effects on the environment

Hazardous activities and

substances

Chemicals Convention, 1990 (No.170) and

Recommendation, 1990 (No.177)

• Chemical data sheets to include information

onenvironmental impact

• Ensuring the use of chemicals is consistent

withprotection

Prevention of Major Industrial Accidents Convention,

1993 (No.174)

• National policies that protect the environment against

the risk of major accidents (for workers and the

general public)

Environmental impact

assessments

Indigenous and Tribal Peoples Convention, 1989

(No.169)

• Studies carried out, and followed up, in cooperation

with indigenous and tribal peoples to evaluate the

environmental impact of development activities

Integration of environmental,

economic and social dimensions

Working Environment (Air Pollution, Noise and Vibration)

Convention, 1977 (No.148) and Recommendation, 1977

(No.156)

Safety and Health in Agriculture Convention, 2001

(No.184)

Transition from the Informal to the Formal Economy

Recommendation, 2015 (No.204)

Employment and Decent Work for Peace and Resilience

Recommendation, 2017 (No.205)

• Control of the workplace as a source of risk for the

environment

• Coordination of measures to protect the environment,

both within and outside the workplace

• OSH mechanisms in agriculture that also take into

account the protection of the environment

• Strategies for sustainable development, poverty

eradication and inclusive growth

• Support the public sector and promoting socially,

economically and environmentally responsible

public–private partnerships

Notication and assistance

(natural disasters or other

emergencies)

Prevention of Major Industrial Accidents Convention,

1993 (No.174)

• Obligation of the employer to maintain emergency

plans and procedures

Safety and Health in Mines Recommendation, 1995

(No.183)

• Emergency response plans in mining operations that

include adequate protection of the environment

Prevention of environmental

pollution/degradation

Asbestos Convention, 1986 (No.162) and

Recommendation, 1986 (No.172)

Safety and Health in Agriculture Convention, 2001

(No.184) and Recommendation, 2001 (No.192)

Safety and Health in Mines Convention, 1995 (No.176)

and Recommendation, 1995 (No.183)

Safety and Health in Mines Convention, 1995

(No.176); Chemicals Convention, 1990 (No.170) and

Recommendation, 1990 (No.177); Safety and Health in

Agriculture Convention, 2001 (No.184); Occupational

Health Services Recommendation, 1985 (No.171)

Safety and Health in Agriculture Recommendation,

2001 (No.192); Safety and Health in Construction

Recommendation, 1988 (No.175); Employment and

Decent Work for Peace and Resilience Recommendation,

2017 (No.205)

• Elimination and minimization of the release of asbestos

dust

• Reduction of greenhouse gas emissions through the

control of hazards in agriculture and due diligence

measures in related to agricultural and mining

activities

• Need to prevent damage to the environment arising

out of mining operations

• Development of an adequate system for the handling

and disposal of chemicals to prevent their use for

other purposes and to eliminate/minimize risks to the

environment

• Participation of occupational health services in

measures to prevent an undertaking’s activities from

having an adverse effect on the general environment

• Measures to protect from risks due to agrochemical

waste, livestock waste. Measures to protect soil and

water contamination, soil depletion and topographic

changes in agricultural activities

• Preservation of the environment in the use of

hazardous substances, the removal and disposal of

waste in the construction sector

• In response to crisis, identifying and monitoring

negative and unintended consequences to avoid

harmful spillover effects on the environment

Table 3.2

3. Regulatory frameworks: Integration, partnerships and dialogue 81

Contribution of international labour standards to the sustainable development normative framework

Sustainable development legal

principles and policy guidelines

International labour standards Methods set out in international labour standards

Participation of indigenous

and tribal peoples in

environmental management

Indigenous and Tribal Peoples Convention, 1989

(No.169)

• Requirement for governments to facilitate contacts

and cooperation between indigenous and tribal

peoples across borders, including activities in the

environmental eld

Right to information Occupational Safety and Health Convention, 1981

(No.155); Safety and Health in Construction Convention,

1988 (No.167); Safety and Health in Agriculture

Convention, 2001 (No.184)

• Obligation of the relevant parties to provide information

on: hazards relating to machinery and equipment;

dangerous properties of substances, biological agents

or products; and instructions on how to avoid known

hazards

• Workers’ right (enterprise level) to know and be

informed of workplace hazards that may affect their

safety or health, to have access to information on the

OSH measures taken by the employer as well as risks

from new technologies

Sustainable patterns

of production and

consumption

Working Environment (Air Pollution, Noise and Vibration)

Convention, 1977 (No.148); Indigenous and Tribal

Peoples Convention, 1989 (No.169); Chemicals

Convention, 1990 (No.170); Safety and Health in Mines

Convention, 1995 (No.176) and Recommendation, 1995

(No.183); Safety and Health in Agriculture Convention,

2001 (No.184) and Recommendation, 2001 (No.192)

• Elimination or reduction of production processes that

may damage the environment, in accordance with

ecological thresholds, and waste minimization

The legal principles and guidelines on sustainable development stem from the 1992 Rio Declaration on Environment and Development (the Rio Declaration), which

underpins the international community’s approach to the environment.

A chemical data sheet is a document containing information on the properties of hazardous

chemicals.

The ILO Code of practice on prevention of major industrial accidents (1991) indicates that the objective of emergency plans is to minimize the harmful

effects of an emergency on people, property and the environment.

Source: ILO compilation.

Table 3.2 (cont’d)

THE EMPLOYMENT AND DECENT WORK DIMENSIONS

OF MULTILATERAL ENVIRONMENTAL AGREEMENTS

Multilateral environmental agreements (MEAs),which are international treaties between States on

environmental issues,

entail legal and policy consequences for labour law and practice. A concern

that is frequently expressed is that MEAs and their incorporation into national legislation may displace

jobs or that, although they foster job creation, the resulting jobs may lack decent work components. A

review of MEAs helps to identify their labour dimensions and ways of effectively voicing labour concerns

in environmental policy-making.

MEAs that include labour concerns

Over the past several decades, the number of MEAs has increased, particularly since the United

Nations Conference on the Human Environment in 1972 (the “Stockholm Conference”). The rst gen-

eration of MEAs were aimed at protecting specic species or ecosystems. However, during the 1990s,

environmental regulations, frameworks and mechanisms increasingly integrated social and economic

considerations, including employment and decent work. Indeed, 18 of the 20 MEAs that include labour

issues have been adopted since 1992.

As shown in table3.3, MEAs containing labour provisions

cover various elds of ILO standard-setting action such as decent work, employment promotion and

protection, just transition, OSH, issues pertaining to the resolution of conicts of law regarding workers’

compensation and, to a lesser extent, the protection of certain environmental rights at work (for an

example, see table3.3).

20. For a review of the features of MEAs and their historical evolution, see Brunnée (2011).

21. The Vienna Convention on Civil Liability for Nuclear Damage of 1963 is the earliest recorded agreement that contains a

reference to “labour”. It provides that, where national provisions related to workmen’s compensation or occupational disease

compensation systems include compensation for nuclear damage, rights of beneciaries of such systems to obtain compensation

and rights of recourse shall be determined by the applicable national law.

82 World Employment and Social Outlook 2018 – Greening with jobs

OSH is an area regulated by both MEAs and ILS. A number of MEAs on the environmental impact of

hazardous substances and activities refer to OSH standards. Examples include the Joint Convention

on the Safety of Spent Fuel Management and on the Safety of Radioactive Waste Management (1997),

the Minamata Convention on Mercury (2013), Annex II to the Protocol to the 1979 Convention on

Long-Range Transboundary Air Pollution on Heavy Metals (1998), and the Regulations concerning the

International Carriage of Dangerous Goods by Rail (2015). These agreements include specic refer-

ences to the safety and health of workers engaged in radioactive waste management and the training

of workers on occupational exposure to mercury, radiation and dust from pyrometallurgical production.

Box 3.3 presents an example of a synergistic interface between labour and the environment in the

Hong Kong International Convention for the Safe and Environmentally Sound Recycling of Ships (2009).

Some MEAs seek to support vulnerable groups through the enhancement of income generation and

employment opportunities.

Others, such as the Kiev Protocol on Pollutant Release and Transfer

Registers to the Convention on Access to Information, Public Participation in Decision-making and

Access to Justice in Environmental Matters (2003), include elements of environmental rights at work,

namely the protection of workers who report a violation of the national laws implementing the Protocol.

Finally, other MEAs, although they do not refer explicitly to specic labour issues, such as OSH or

social dialogue, have indirect implications for the activity of certain sectors and the working conditions

therein. This is the case, for example, of the Montreal Protocol on Substances that Deplete the Ozone

Layer (in force since 1989), which was amended in 2016 during the 28th Meeting of the Parties in

Kigali. In the amendment the parties agreed to reduce the production and usage of hydrouorocar-

bons in phases, contributing to climate change mitigation as they are powerful GHGs. By altering the

methods of production of particular industries, these agreements can bring about direct and indirect

effects (formore details on economy-wide effects of achieving sustainability, see Chapter2).

22. The United Nations Convention to Combat Desertification in those Countries Experiencing Serious Drought and/or

Desertication, particularly in Africa, 1994, and the International Tropical Timber Agreement, 2006.

Labour issues in multilateral environmental agreements

Policy area MEA

Decent work • United Nations Convention on the Law of the Sea (1982)

• Convention on the Protection of the Marine Environment of the Baltic Sea area (1992)

• International Tropical Timber Agreement (2006)

• Paris Agreement under the United Nations Framework Convention on Climate Change (2015)

Employment promotion

and protection

• United Nations Convention to Combat Desertication in those Countries Experiencing

Serious Drought and/or Desertication, particularly in Africa (1994)

• Agreement for the Implementation of the Provisions of the United Nations Convention

onthe Law of the Sea of 10 December 1982 relating to the Conservation and Management

of Straddling Fish Stocks and Highly Migratory Fish Stocks (1995)

• International Tropical Timber Agreement (2006)

Environmental rights

at work

• Kiev Protocol on Pollutant Release and Transfer Registers to the Convention on Access

to Information, Public Participation in Decision-making and Access to Justice in

Environmental Matters (2003)

Just transition • Paris Agreement under the United Nations Framework Convention on Climate Change (2015)

OSH • Convention on Nuclear Safety (1994)

• Joint Convention on the Safety of Spent Fuel Management and on the Safety of Radioactive

Waste Management (1997)

• Protocol to the 1979 Convention on Long-Range Transboundary Air Pollution on Heavy

Metals (1998)

• Rotterdam Convention on the Prior Informed Consent Procedure for Certain Hazardous

Chemicals and Pesticides in International Trade (1998)

• Stockholm Convention on Persistent Organic Pollutants (2001)

• International Convention on the Control of Harmful Anti-Fouling Systems on Ships (2001)

• Hong Kong International Convention for the Safe and Environmentally Sound Recycling

ofShips (2009)

• Minamata Convention on Mercury (2013)

Rules on the resolution

of conicts of law regarding

the compensation

of workers

• Vienna Convention on Civil Liability for Nuclear Damage (1963)

• International Convention on Liability and Compensation for Damage in Connection with

theCarriage of Hazardous and Noxious Substances by Sea (1996)

• Convention on Supplementary Compensation for Nuclear Damage (1997)

Note:See Appendix 3 for a full analysis of employment and decent work parameters in MEAs.

Source: ILO compilation.

Table 3.3

3. Regulatory frameworks: Integration, partnerships and dialogue 83

The promotion of ILS can be broadened through MEAs

Another approach to integration is the manner in which MEAs make direct reference to ILS. For ex-

ample, the United Nations Convention on the Law of the Sea (1982), the International Tropical Timber

Agreement (2006) and the Hong Kong Convention (2009) consider ILO instruments as relevant legal

frameworks for the implementation of their measures.

The United Nations Convention on the Law of the Sea (1982) refers to the applicable international

regulations, which include ILS, to ensure health and safety at sea with regard to labour conditions

(Article 94). Comparable legal linkages with labour and decent work are also present in the Minamata

Convention on Mercury (2013), which provides for institutional cooperation between States parties to

the Convention and the ILO on health and safety issues (Article 16). Such references may be regarded

as evidence of the impact of the ILS on treaty-making processes as well as open routes for the broad

incorporation of ILS in the implementation of international environmental treaties.

In some cases, MEAs with OSH provisions have received higher endorsement than ILO Conventions on

OSH, as shown in gure3.2. For example, the Stockholm Convention on Persistent Organic Pollutants

(2001) has been ratied by 97per cent of ILO member States, while the gurefor the Occupational

Safety and Health Convention, 1981 (No.155), is only 35per cent (Panel A). Panel B shows the per-

centage of ILO member States which have ratied OSH and other related Conventions.

However, ILO Conventions, regardless of ratication, may be reected in national legislation, policies

and practices. For example, 21 countries that had not ratied Convention No.155 reported to the ILO

that the Convention had been or was being taken into consideration in efforts to improve domestic OSH

law and practice, in some cases with a view to future ratication (ILO, 2009). Obstacles to ratication of

OSH Conventions include difculties in reaching agreements with the full support of the social partners,

The shipping industry has been effective

at recycling and reusing materials, through

the adoption of practices related to sustain-

ability and a “life-cycle approach”. However,

ship dismantling has been associated with

processes that are dangerous to human

safety and health and cause environmental

pollution, in particular in emerging and

developing economies, where the ship

recycling industry offers new economic

opportunities. Since the maritime legal

framework does not apply to the latter cycle

of a vessel’s life, there were no standards

relating to ship decommissioning and dis-

posal until recently (Andersen, 2001).

A normative response to some of these

issues in the ship scrapping industry is

the Hong Kong International Convention

for the Safe and Environmentally Sound

Recycling of Ships (2009) (the “Hong Kong

Convention”). The Convention challenges

older models of production that neglect life-

cycle safety and environmental impact in

the design of ships. It also pursues the ob-

jectives of the protection of the environment

and of human health, and particularly of

workers involved in ship recycling. While cer-

tain ILO Conventions provide a legal frame-

work for OSH in shipyards and the ILO has

developed guidelines on shipbreaking (ILO,

2004), the Hong Kong Convention is an in-

strument that integrates both environmental

and labour concerns in a single regulation.

The Hong Kong Convention incorporates

the labour dimensions of shipbreaking by in-

cluding important aspects of ILS, including

the fundamental labour standards and

those on OSH, social dialogue, guidance

and training.

For example, theConvention

includes a framework forthe development

of a programme to provide appropriate

information, training and equipment to

workers for safe and environmentally sound

operations and the management of haz-

ardous materials (Regulations 18 and 20);

information and training on emergency pre-

paredness and response for all workers in

the ship recycling facility (Regulation 21);

worker safety (including the use of personal

protective equipment) and training covering

all workers, including contractor personnel

and employees (Regulation 22).

These standards are included in the Annex to the Convention (Regulations for Safe and Environmentally Sound

Recycling of Ships) which, in accordance with Article 1, forms an integral part of the Convention.

Integrated environmental and labour regulation: The case of the Hong Kong International

Convention for the Safe and Environmentally Sound Recycling of Ships (2009)

Box 3.3

84 World Employment and Social Outlook 2018 – Greening with jobs

the need to strengthen coordination between government authorities working on various OSH issues,

lack of capacity, and lack of conformity between the Convention and existing national legislation.

When parties to an MEA with a labour reference implement such reference, they could also seek guid-

ance in the content of ILS. For instance, the Stockholm Convention on Persistent Organic Pollutants

(2001) sets out that appropriate techniques to prevent or reduce releases of certain chemicals must

take into consideration the need to ensure OSH at workplaces. To comply, States may refer to ILS on

OSH. MEAs with labour dimensions could therefore help to improve the impact of ILS by broadening

their substantive scope and outreach.

23. See ChapterIV of ILO (2009) on impact, obstacles and prospects for further ratications of ILO standards on occupational

safety and health.

100

Panel A. Ratiﬁcation of MEAs with OSH provisions and C155 (percentages)

Percentage of ILO membership

Panel B. Ratiﬁcation of other international labour standards (percentages)

Percentage of ILO membership

Asbestos

Convention,

1986 (No. 162)

Indigenous and

Tribal Peoples

Convention,

1989 (No. 169)

Chemicals

Convention,

1990 (No. 170)

Prevention of

Major Industrial

Accidents

Convention,

1993 (No. 174)

Safety and

Health in Mines

Convention,

1995 (No. 176)

Occupational

Safety and

Health

Convention,

1981 (No. 155)

Promotional

Framework for

Occupational

Safety and

Health

Convention,

2006 (No. 187)

Convention

on Nuclear

Safety, 1994

Joint Convention on

the Safety of Spent

Fuel Management

and on the Safety of

Radioactive Waste

Management, 1997

Minamata

Convention on

Mercury, 2013

Protocol to the 1979

Convention on

Long-Range

Transboundary Air

Pollution on Heavy

Metals, 1998

Rotterdam Convention

on the Prior Informed

Consent Procedure

for Certain Hazardous

Chemicals and Pesticides

in International Trade,

1998

Stockholm

Convention on

Persistent

Organic

Pollutants,

2001

MEAs with OSH provisions

Ratiﬁcation of ILO Convention No. 155

Safety and

Health in

Agriculture

Convention,

2001 (No. 184)

Ratication by ILO member States of MEAs with OSH provisions vis-à-vis the Occupational

Safety and Health Convention, 1981 (No. 155), and ratication of certain other ILS

Figure 3.2

Source: ILO compilation.

3. Regulatory frameworks: Integration, partnerships and dialogue 85

B. Mainstreaming decent work in laws

and policies at the national level

At the national level, rules and policies to make the environment more sustainable are scattered among

regulations governing specic issues or areas (such as climate change) and specic sectors, including

energy, land use and agriculture, forestry, waste management and transport. Accordingly, although

an increasing number of legal and policy frameworks have been adopted on the “green economy” or

“green growth”, this is not yet a widespread practice in all countries and regions. Environmental legis-

lation and policies have emerged in various forms and reect country-specic contexts. This section

focuses on national laws and regulatory instruments in countries at different levels of development.

It identies certain trends and documents legal developments in sectors and focus areas relevant to

the green economy (e.g. climate change). It also shows how employment and decent work parameters

have been integrated into national regulation and provides a basis for discussion of emerging regulatory

approaches to the employment in transition.

NATIONAL LEGISLATION AND POLICIES GOVERNING

THE TRANSITION TO A GREEN ECONOMY

Labour dimensions are found in various types of green policies and national legislation

Legislation and policies aimed at greening jobs can be varied and adopted in various contexts.

This

section has identied four in particular. First, they can be adopted as part of a specic legal or policy

framework on employment in transition, addressing most issues related to them. Some countries have

adopted or discussed green jobs acts that deal with green jobs across all or sectors of interest (e.g. Bill

for a Green Jobs Act introduced in 2016 in New Brunswick, Canada).

Second, countries can integrate employment in transition issues into wider development and green

growth legislation, policies and plans. For example, in the Republic of Korea, the Framework Act on

Low Carbon, Green Growth (2010) includes several provisions on employment. The denition of “green

growth”

includes the creation of new job opportunities and employment is identied as one of the

basic principles for the promotion of low-carbon growth. Moreover, the Government is required to

provide technical support, and to create and expand jobs for green technology and green industries,

so that every citizen can benet from green growth and learn about new technologies (Article 35).

Third, countries can incorporate labour considerations into laws and policies on specic sectors or

particular focus areas, such as climate change adaptation/mitigation, renewable energy, environmental

protection, land use and forestry, and waste management. For example, the legislation in Algeria on

energy efciency and the promotion of renewable energy supports the creation of conducive en-

vironment that may lead to creation of energy services enterprises, and thus to the generation of

employment opportunities.

Fourth, a mixed approach can be adopted combining specic legislation on green jobs and integrating

labour issues into sectoral laws and policies. For example, the Philippines has adopted the Green

Jobs Act of 2016 and has incorporated employment-related provisions into sectoral laws, such as the

Renewable Energy Act of 2008 and the People’s Survival Fund Act of 2011.

24. Chapter2 explores the impact of environmental legislation on the level and composition of employment, with a particular

focus on greenhouse gas (GHG) emissions.

25. A number of countries have embarked on green growth and green policies as a result of the 2008 nancial crisis. A concept

that rose to popularity in this context was the “Green New Deal”, culminating in the endorsement of the concept of green economy

at the Rio+20 Conference in 2012.

26. The purpose of the Bill is job creation and strengthening the province’s local economy, while at the same time reducing

dependence on fossil fuels. At the time of drafting the present report, the Act was not yet adopted.

27. Article 2 on denitions provides:“The term ‘green growth’ means growth achieved by saving and using energy and resources

efciently to reduce climate change and damage to the environment, securing new growth engines through research and devel-

opment of green technology, creating new job opportunities, and achieving harmony between the economy and environment”.

28. Law on Energy Management, Law no. 99-09, 28 July 1999, see particularly Article 33.

86 World Employment and Social Outlook 2018 – Greening with jobs

Environmental legislation has been adopted not only in developed economies, but also in developing

and emerging economies in various regions. A review of 16 countries in sub-Saharan Africa

found

that environmental issues are linked to employment and work-related matters in the legislation adopted

since the early 2000s. Box 3.4 presents an overview of legal developments and examples of green jobs

legislation covering specic sectors or focus areas in sub-Saharan Africa.

29. The countries analysed are: Benin, Burkina Faso, Burundi, Central African Republic, Chad, the Comoros, Democratic Republic

of the Congo, Djibouti, Guinea, Madagascar, Mali, Mauritania, Niger, Rwanda, Senegal and Togo.

Sub-Saharan Africa is one of the fastest-

developing regions in the world. However,

due to such factors as widespread poverty,

recurrent droughts and over-dependence

on rain-fed agriculture, it is considered to

be more vulnerable to the impacts of en-

vironmental degradation. This intensifies

the vulnerability of the region’s economies,

which are dependent on natural resources

(German Federal Ministry for Economic

Cooperation Development, 2015).

In this regard, the Constitutions of 12 of the

16 countries analysed defend the right to

work and live in a clean and healthy en-

vironment, and most of the countries pro-

mote environmental impact assessments.

Moreover, sectoral laws emphasize the role

of workers in respecting and protecting the

environment. This is the case of the Mining

Codes in Benin (2006) and Burkina Faso

(2003), the Forest Code in the Central

African Republic (2008), the Oil Code in the

Comoros (2012) and agriculture laws in the

Democratic Republic of the Congo (2011).

Legislative and policy measures also try to

combine the goal of job creation with the

preservation of the environment, including

training for workers and the introduction of

environmental concerns into educational

programmes. Examples of development

plans or national strategies on climate

change that include labour issues exist in

Chad, Burkina Faso, Burundi, Mali, Niger

and Senegal. In the case of Niger, the

National Policy on Climate Change (2012)

promotes the creation of “green jobs” and

the adoption of tax incentives for employers

that create them.

In the case of sectoral laws, legislation

targeting renewable energy and waste

management acknowledges the need for

new knowledge area and employment op-

portunities. In order to remedy electricity

shortages, legal texts encourage the pro-

duction, consumption, sale and import of

renewable energy. There are tax incentives

to support this sector in countries such as

Benin, Burkina Faso, Burundi, Djibouti and

Mali. Legislation also promotes waste man-

agement, taking into account population

growth. The public authorities are respon-

sible for ensuring the provision of adequate

waste management services, and the private

sector is encouraged to supplement govern-

ment efforts to preserve public health.

Finally, some countries have adopted green

jobs programmes. For instance, in Senegal,

a joint programme with the United Nations

Development Programme seeks to promote

and develop new sectors with green jobs,

to build the capacities of certain groups (in-

cluding women) and to provide training on the

creation of green jobs. At least 1,000green

jobs have been created in Senegal since

2015, and 10,000 more are expected within

the next ve years (UNDP, 2015).

The Policy denes green jobs as follows: “Green jobs are jobs that help reduce the environmental impact of economic

sectors to keep it at an acceptablelevel, so as to ensure development on a sustainable basis preserving the interest of

present and future generations” (unofcial translation).

While the programme does not provide a denition of green

jobs, it does indicate as an objective the creation of “decent green jobs”. The UNDP has acknowledged that the ILO

denition of green jobs is one of the most widely accepted (see, for example, UNDP, 2013).

Greening jobs in sub-Saharan Africa

Box 3.4

3. Regulatory frameworks: Integration, partnerships and dialogue 87

Different approaches in dening “green jobs” exist in national legislation and policies

A qualitative analysis of national legislation shows that existing regulatory frameworks across countries

have not yet established a set of common criteria to dene green jobs, green employment, greening

with jobs or what a just transition to a green economy will imply. What exists is rather a variety of ap-

proaches. Table 3.4 provides examples of various national laws and policies aimed at promoting a just

transition to a green economy.

This analysis also reveals a range of components that make up a broader concept of green jobs, in

which various elements central to the concept of greening with jobs emerge: the importance of decent

work and fundamental rights at work, the participation of the social partners as well as environmental

action and rights at work. The addition of environmental rights at work to the notion of greening with

jobs is signicant (box3.5), as any workplace can contribute to the reduction of environmental impact

and to green growth. This is consistent with the idea that the reduction of GHG emissions cannot be

limited to polluting industries. A broad-based approach is necessary to encourage behavioural adjust-

ments and changes in consumption and production patterns throughout the economy.

National legislation and policies also have specic implications for the forecasting of skills needed for

the green transitions, skills surveys and the provision of skills programmes (such as the 2015 Act on

the energy transition for green growth in France). Chapter5 reviews how skills development policies

have taken into account the requirements implied by environmental legislation.

Examples of labour dimensions in national legislation on green growth

Labour dimension Country National law Content of provision

Decent work Côte d’Ivoire Act No.2015-537 on

agricultural policy,

2015

Pursues environmental and decent work objectives in an inte-

grated manner. It aims to develop an “optimized” agricultural

sector that preserves and restores biodiversity while contributing

to poverty alleviation and job creation, and combating forced

labour and the worst forms of child labour. It reafrms the obli-

gation of the State to protect young persons and to ensure the

safety and health of agricultural workers.

Green jobs Philippines Green Jobs Act

of2016

Promotes the creation of green jobs, granting incentives and

appropriating funds. It also provides a comprehensive denition

of “green”, which incorporates decent work dimensions (i.e. pro-

ductive jobs creation, respect for the rights of workers, delivery

of a fair income, provision of security in the workplace and social

protection for families, and the promotion of social dialogue).

Greening

the workplace

Mexico General Act on climate

change, 2012

Identies a number of measures to reduce emissions in the

transport sector by changing consumption behaviour at the

workplace. Agencies and entities of the federal public admin-

istration, federal entities and municipalities, acting within their

competence, have to promote the design and development of

policies and mitigation actions. The law encourages the estab-

lishment of programmes to reduce displacement of workers

(e.g.telework or providing collective transport).

Job creation Brazil Act No.12.305

establishing the

National Policy on

Solid Waste, 2010

Recognizes reusable and recyclable solid waste as an economic

good of social value, a generator of work and income and pro-

moter of citizenship.It also requires any municipal solid waste

management plan to include, among other measures, mech-

anisms for the creation of sources of business, employment and

income through the valuation of solid waste.

Source: ILO compilation.

Table 3.4

88 World Employment and Social Outlook 2018 – Greening with jobs

LABOUR DIMENSION IN LEGISLATION AND POLICIES

OF STRATEGIC IMPORTANCE FOR ENVIRONMENTAL PROTECTION

Climate change policies that also address employment and decent work issues

In view of the role assigned to climate change policy frameworks, including nationally determined

contributions (NDCs), in the current context of the transition to a low-carbon economy, the inclusion of

provisions related to employment and decent work is important. One question in this respect is whether

coherence is being sought in current climate change policies (as part of green policies) between eco-

nomic, environmental and social objectives.

A review of climate change policies in 26 countries (including adaptation and mitigation action) found

that 19 of the policies include labour dimensions.

Of these, ten make reference to skills, training and

capacity building for adaptation, eight refer to job creation as an objective or outcome of climate pol-

icies, and seven consider job creation as a component of sectoral action. Other labour-related aspects

range from the integration of climate change into training for various professions and the development

of capacity-building for adaptation strategies (awareness of the phenomenon and its technical and

organizational implications) to the re-skilling of specic groups of professions. Figure3.3 provides a

breakdown of the labour dimensions identied in climate change policies.

Few climate change frameworks (three out of 26 countries studied) include explicit references to a just

transition. Similarly, several include references to decent work and quality employment. In contrast,

the climate policy in France species detailed transition measures, such as: inclusiveness (everyone

affected directly or indirectly is taken into account); the development of plans to consider converting

plants that face closure; and the involvement of the social partners in designing solutions for sectors

affected by the transition.

Table 3.5 includes further examples of the design and content of climate

change and green growth policies that include labour issues. Furthermore, Small Island Developing

States have taken steps to develop national policy frameworks that address climate-induced displace-

ments through pre-emptive labour migration opportunities abroad.

30. The policies examined do not include NDCs. A separate review of NDCs for G20 countries has shown that integration of

employment and decent work has been rather limited.

31. Climate Plan (Plan Climat), 1 July 2017.

32. International Labour Organization Office for Pacific Island Countries: Compendium of Legislation and Institutional

Arrangements for Labour Migration in Pacic Island Countries (2014). Suva, Fiji. Available at: http://www.unescap.org/sites/

default/les/Compendium-of-Legislation-and-Institutional-Arrangements-for-Labour-Migration-in-Pacic-Island-Countries.pdf

The Labour Code in France includes envir-

onmental elements in the rights and duties

of employers and workers. Section L.4133

establishes the right of alert (droit d’alerte),

or early warning. This right has its origins in

the constitutional obligation to protect the

environment, and in Act No.2013-316 of

16April 2013 which empowers natural or

legal persons to make public information

which, if not available to the public, may

pose a serious risk to the environment.

Workers may exercise the right of alert in the

presence of three cumulative conditions:

the existence of a risk to the environment;

the seriousness of the risk; and its relation

to the product or manufacturing processes

used by the enterprise. A notication can

be submitted by the staff representative to

the health, safety and working conditions

committee. The alert should be recorded

in writing and the employer is required to

inform the notifying worker of the action

taken as a result. The employer decides on

the action to be taken. However, it could be

argued that recorded communications pro-

vide an in-built tracking system and that the

employer should be required to justify due

diligence and the adequacy of the meas-

ures taken in the event of a civil or crim-

inal procedure. The right of alert appears

to be a positive development, as it contrib-

utes to a better integration of the world of

work and the environment. Importantly,

this early-warning mechanism can help an

enterprise to take action in the event of an

imminent threat of environmental damage.

Environmental rights at work: The French Labour Code

Box 3.5

3. Regulatory frameworks: Integration, partnerships and dialogue 89

Linking climate change policies

with income-generation activities

Reference to social partners

Evaluate the impact of climate change

on employment

OSH concerns

Adaptation measures for

climate-induced strains on workers

Employment as pre-existing challenge

Just transition for workers

Decent work/Quality jobs

Attention to employment for workers

Job creation as a component

of a sectoral action

Creation of jobs as an objective

of climate change policies

Skills, training, and capacity building

for adaptation

Breakdown of labour dimensions in general climate change policies

Figure 3.3

Note: Based on data from 26 countries (Algeria, Argentina, Australia, Bangladesh, Belgium, Brazil, Burkina Faso, Canada, China,

Chile, Colombia, France, Germany, India, Kazakhstan, Kenya, Mexico, Namibia, Nepal, Russian Federation, Senegal, Singapore,

South Africa, Switzerland, Thailand, United Kingdom). Extensive desk studies, analysis and review of climate change laws and

policies of these countries were undertaken with a view to identifying labour-related content.

Source: ILO calculations.

Examples of green policies that include labour issues

Country National policy Content of policy

Cambodia National Policy on Green

Growth, 2013

Focuses on strategic human resources development in the framework of green

growth. Measures include: mainstreaming the principle of green growth, including

jobs in the green economy (i.e. employment in such sectors as green investment,

telecommunications, transport, energy and tourism); and integrating green growth

into the curricula of vocational training schools.

Canada Pan-Canadian Framework

on Clean Growth and

Climate Change, 2016

While also improving environmental performance, clean technologies could en-

hance the productivity and competitiveness of businesses and foster job creation.

In terms of skills, Canada should be able to access talented workers from around

the world and provide training for national workers.

Fiji Green Growth Framework

for Fiji, 2014

Seeks to address unemployment and underemployment issues through the en-

hancement of job skills for sustainable development focusing on youth by 2020.

This includes apprenticeship schemes, trade skills, incentives for micro-, small and

medium-sized enterprises, and vocational training programmes.

France Climate Plan, 2017 Provides for the creation of “ecological transition contracts” for workers whose

jobs are threatened. Stakeholders, including the social partners, contribute to dis-

cussions on changes to jobs in such sectors as energy as a result of current and

future transitions.

Mongolia Green Development Policy,

2014

Identies green employment

as a strategic objective and a key indicator to measure

progress in the transition to a green economy. Provides for measures such as:

securing income through decent employment for at least 80per cent of work-

ing-age population; involving citizens in vocational training programmes; creating

job placement services; providing sufcient compensation to women for childcare;

and increasing resilience to the negative impacts of climate change.

The policy denes a “green job” as any job that contributes to the reduced consumption of energy, raw materials and water and to

limiting greenhouse gas emissions, waste and pollution, ecosystem preservation and restoration, and is aimed at environmental protec-

tion and the improvement of environmental quality through climate change adaptation.

Source: ILO compilation.

Table 3.5

90 World Employment and Social Outlook 2018 – Greening with jobs

Litigation on climate change as a useful tool,

but currently of limited relevance to labour issues

It should also be noted that litigation on climate change issues has become a tool in some countries

to address climate challenges.

A recent report nds that, outside the United States, there have been

over 250 court cases in which climate change has been a subject of litigation, although mostly not

the core claim (Nachmany etal., 2017). Most of the lawsuits focus on obtaining more information and

disclosure from governments or sources considered as emitters. Others relate to the implementation of

laws and policies, even if they are adopted at the international level, such as the Kyoto Protocol and the

Paris Agreement, while others relate to claims for protection or losses and damages to personal prop-

erty arising out of events linked to climate change. However, labour issues do not appear to be central

in loss and damage cases, with the exception of cases in which specic types of workers have been

affected, such as farmers. The same study nds that most of the cases are led against governments

(46per cent), followed by corporations (13per cent), and that they are brought by corporations (102),

followed by governments (51), individuals (56), non-governmental organizations (33), or a combination

of plaintiffs (11). Although these lawsuits have enhanced the impact of legislation, more research is

required on their overall impact.

Employment and decent work issues in sectoral legislation and policies

In addition to general climate change laws and policies, sectoral environmental and green growth

laws and policies that address labour issues have also been adopted. The key sectors relevant to the

greening of the economy and subject to regulation worldwide include agriculture, forests, biodiver-

sity, sheries, marine issues, water regulation, tourism, energy, transport, building and construction,

manufacturing, mining, waste disposal and waste minimization.

Energy legislation is a case in point. Some countries have adopted laws, policies and programmes to

promote: environmentally sound energy generation and reduced emissions; low-carbon energy pro-

duction (including wind, solar, geothermal, hydro and nuclear power); energy efciency; and the use

of renewable energy in the renovation and reconstruction of buildings. Labour issues, including skills

development and training, are also taken into account in legislation governing the energy sector. Of the

40 countries for which the energy legislation was analysed, 27 include labour issues, and particularly

skills and training. Table 3.6 shows the distribution of labour issues by country income group.

33. See e.g. Urgenda Foundation v. the State of the Netherlands (Ministry of Infrastructure and the Environment), C/09/456689

/ HA ZA 13-1396, 24 June 2015.

Labour considerations in energy legislation by country income group (analysis of 40 countries)

Income group

(number of countries considered)

General reference

tolabour

Job creation Skills/

training

Social

dialogue

Total number

of references

High income (15) 8 5 9 1 23

Upper-middle income (13) 7 5 10 0 22

Lower-middle income (8) 2 2 5 0 9

Low income (4) 1 1 1 0 3

Total number of references 18 13 25 1 57

Algeria, Argentina, Australia, Bangladesh, Belgium, Brazil, Burkina Faso, Cambodia, Canada, Chile, China, Colombia, Costa Rica,

Egypt, Fiji, France, Germany, India, Indonesia, Italy, Kenya, Kyrgyzstan, Luxembourg, Maldives, Mexico, Mongolia, Namibia, Nepal,

Nigeria, Norway, Saudi Arabia, Senegal, Singapore, South Africa, Switzerland, United Republic of Tanzania, Thailand, Trinidad and

Tobago, Turkey, United Kingdom.

Source: ILO compilation.

Table 3.6

3. Regulatory frameworks: Integration, partnerships and dialogue 91

Although environmental and green growth laws and policies may seek to create new employment

opportunities, the jobs created are not automatically safe and decent. This is partly because OSH

policy and practice can sometimes be reactive, rather than seeking to prevent new risks (EASHW,

2013). Workers in the new industries or occupations may face hazards, including new and emerging

risks, often associated with new technologies (ILO, 2017b). Figure 3.4 presents the results of a review

of legislation and policies in specic sectors and focus areas in the same 40 countries at different

levels of development in the various regions. The review shows that 37.5per cent of countries include

OSH dimensions in laws and policies focusing on agriculture and forestry, 17.5per cent in energy

and 70per cent in waste management. Moreover, 37.5per cent of countries include OSH issues in

general environmental legislation and 7.5per cent in climate change legislation. It is therefore im-

portant not only to strengthen the role and place of OSH standards in laws and policies related to the

greening of the economy, but also to incorporate these aspects as a fundamental element of training

(UNFCCC, 2016).

Number of countries

Percentages

Agriculture

and forestry

Climate change Energy General environmental

legislation

Waste

management

Number of countries

Share in the total number of countries

OSH issues in legislation relevant to green transition (analysis of 40 countries by sector and focus area)

Figure 3.4

Algeria, Argentina, Australia, Bangladesh, Belgium, Brazil, Burkina Faso, Cambodia, Canada, Chile, China, Colombia, Costa Rica, Egypt,

Fiji, France, Germany, India, Indonesia, Italy, Kenya, Kyrgyzstan, Luxembourg, Maldives, Mexico, Mongolia, Namibia, Nepal, Nigeria,

Norway, Saudi Arabia, Senegal, Singapore, South Africa, Switzerland, United Republic of Tanzania, Thailand, Trinidad and Tobago,

Turkey, United Kingdom.

Source: ILO calculations.

92 World Employment and Social Outlook 2018 – Greening with jobs

C. Greening the workplace through social dialogue

SOCIAL DIALOGUE: INCLUSION OF ALL CLIMATE ACTORS

Enterprises are often recognized as “climate actors”, meaning agents capable of contributing to the

green transformation of the economy. Hence, employers’ organizations are important agents of change

who are able to develop new ways of working that safeguard the environment. Chapter2 has also noted

the various voluntary initiatives adopted, particularly by large enterprises, to improve environmental

sustainability (e.g. the inclusion of environmental provisions in codes of conduct for suppliers, which

may be enforced when introduced in contracts).

Although these efforts should be recognized, not all

rms are able to adopt voluntary practices for the reasons discussed in Chapter2 (including additional

costs for micro-, small and medium-sized enterprises, or the perceived lack of benets).

Trade unions also play a role in responding to the occupational impact of environmental policies and in

identifying challenges and opportunities for workers in the transition to the green economy.

Indeed,

much of the work carried out on the implications of climate change for employment, such as policy

articulation to address the trade-off between employment and climate action, and advancing workplace

action on the environment, has been undertaken by trade unions.

However, the impact achieved by

trade unions acting alone may be rather limited (Glynn, Cadman and Maraseni, 2017).

The role of the governments in supporting an enabling environment and the participation of all social

actors, including the social partners, is of paramount importance, as recognized in the Guidelines

for a just transition towards environmentally sustainable economies and societies for all (ILO, 2015a).

Although the number of policies and institutional initiatives at the international level that combine

decent work and environmental concerns in a fully integrated manner is limited,

the participation

of workers’ and employers’ organizations must be integrated in mitigation and adaptation policies.

They are the ones who are best placed for their implementation, for taking action at the workplace and

reducing the environmental impact of production activities.

For example, collaboration between workers and employers can help to: (a) prevent and reduce the

environmental impact of enterprises; (b) put into action environmental policies, plans and actions within

an enterprise; (c) improve working conditions, as appropriate environmental regulations and practices

also help to prevent and minimize risks to worker health; (d) preserve the quality of jobs and promote

the quality of new “green jobs”; and (e) enhance public participation and voice in environmental deci-

sions and decision-making processes.

As observed in section A, ILS support consultation mechanisms at the workplace are a tool for workers

to exercise their right to participate in decisions affecting their lives. Although the rights of the public to

information, participation and access to justice are set out in the Convention on Access to Information,

Public Participation in Decision-making and Access to Justice in Environmental Matters (1998), also

known as the “Aarhus Convention”, the right of the social partners to participate in environmental

matters is not specied. The Aarhus Convention concerns participation at a broader policy level, rather

than strictly in the workplace.

The review of legislation in this section has shown that environmental rights at work are rarely ad-

dressed comprehensively or explicitly by national legislation. Agreements negotiated by the social

partners (including collective agreements) have thus become, at least in the short term, an important

instrument of social dialogue to promote environmental commitments within enterprises at the national

and global levels.

34. See, for example, Beckers (2016); Mitkidis (2014).

35. For a thorough analysis, see Hampton (2015).

36. Some major statements and reports include: ITUC: Trade unions and climate change: Equity, justice & solidarity in the ght

against climate change, Trade Union Statement to the 15th Conference of the Parties, United Nations Framework Convention on

Climate Change (UNFCCC), Copenhagen (7–18 December 2009); ITUC: Growing green and decent jobs, 2012. See also TUC:

The Union Effect: Greening the workplace, 2014.

37. Despite the progress achieved, the 2015 Paris Agreement, the single most important roadmap to tackle climate change, refers

to the concept of a just transition for workers only in its preamble.

38. This point is developed in ETUC (2004).

3. Regulatory frameworks: Integration, partnerships and dialogue 93

NATIONAL PRACTICES RELATING TO THE INCLUSION

OF ENVIRONMENTAL CLAUSES IN COLLECTIVE AGREEMENTS

Social dialogue on environmental rights has been progressing slowly in certain countries, and has per-

meated into policies adopted at the national level. For example, the Green Skills Agreement in Australia

(between the Federal Government and state and territory governments) is the result of negotiations that

included participation by the social partners, however limited (Chapter5).

Laws do not currently grant trade union representatives who deal with environmental issues at the

workplace the right to time off, training or facilities to extend the scope of union activities to cover

environmental issues. This role is usually performed under agreements negotiated with employers. At

the enterprise level, employers and trade unions have worked together to identify areas, including GHG

emissions, where a reduction in environmental impact could be achieved without losses in jobs, pay

and working conditions. In Italy, for example, enterprise-level collective bargaining agreements recog-

nize commitments for sustainable development, such as strengthening OSH, promoting sustainable

mobility (e.g. car sharing), protection of vulnerable groups, elimination of waste, and adopting initiatives

aimed at enhancing the well-being of workers and families, among others.

Other agreements have

included in the calculation of the workers’ productivity premium an indicator linked to resources con-

sumption (such as water or energy), where lowering consumption could lead to a higher premium.

Green provisions in collective agreements, particularly those containing concrete and appropriate ac-

tions oriented on greening workplaces, are part of a new direction taken recently at the national level.

Moving towards the transformation of global production and consumption, as well as the impact of

environmental laws and policies, the trend is for the environment to become a key aspect of social

dialogue. Indeed, there is a growing understanding that environmental policies are essential to ensure

decent and sustainable employment in the long term. Table 3.7 shows some examples of green provi-

sions that have been negotiated in collective agreements in Canada.

In comparison with the global level, national collective bargaining agreements tend to be more

inward-looking. Green clauses in these agreements are often mainly focused on the specic action

that workers and enterprises can take to contribute to the greening of workplaces, and ultimately to the

improvement of the general environment.

In Belgium, the National Collective Agreement 98 (CCT 98), negotiated by employers and workers

with government approval, provides for a benet known as “eco-cheques” (éco-chèques), intended to

help workers access and acquire ecological services and products. The agreement includes an annex

listing the products and services that can be purchased with the cheques; these include energy-saving

appliances, vehicles providing environmentally friendly mobility, ecotourism, sustainable gardening and

second-hand and recycled products.

A model agreement

on the environment and climate change in the United Kingdom includes provi-

sions on energy use (eco-efcient energy use and energy-saving measures), recycling and resource

use (eco-purchasing, energy-saving equipment, minimizing the use of non-recyclable materials, opting

for re-used or re-usable supplies, low-cost water-saving measures), food (locally sourced, not over-

packaged or over-processed, and avoiding food in disposable packages), transport (working to design

a travel plan that uses sustainable modes of transport, encouraging tele-conferencing) and other mis-

cellaneous provisions (such as considering the use of plants to improve CO

absorption).

39. See e.g. Agreement between Luxottica and the Luxottica Union Coordination (30 October 2015).

40. See e.g. Agreement between Marposs S.p.A and R.S.U. and OO.SS. (1 September 2017).

41. Broadly speaking, a model agreement is a sample collective bargaining agreement to be used as a basis for a negotiation.

94 World Employment and Social Outlook 2018 – Greening with jobs

Green provisions in a national context: Examples of Canadian collective bargaining practice

Areas of action Good practice/green provisions

Green procurement International Association of Machinists and Aerospace Workers (2010): the green provision negotiated

sets out the employer’s commitment to undertake reasonable efforts to provide environmentally friendly

products and services for employees to use, such as paper, ink, soap and cleaning supplies. Where the

employer provides products, to the greatest extent possible they will be: locally grown and produced;

pesticide free; non-genetically modied; and products produced in an ethical and fair-trade manner.

The Canadian Union of Public Employees (CUPE, 2012), the British Columbia Community Social Services

Bargaining Association of Unions (CSSBA, 2014) and the British Columbia Government and Service

Employees’ Union (BCGEU, 2012): in the provision the employers commit to investigate the use of or to

use, whenever possible, environmentally friendly products.

Canadian Union of Public Employees (CUPE, 2008): The clause includes the establishment of a Joint

Review Committee (employer–worker) with a mandate to identify alternatives to any potentially hazardous

chemicals/equipment and to seek to promote environmentally friendly products in facilities.

Green travel The British Columbia Government and Service Employees’ Union (BCGEU, 2012): the agreement provides

that the employer shall actively participate in environmentally sustainable employee transit programmes.

The Public Service Alliance of Canada (2013) negotiated an agreement under which employees and their

family members are encouraged to use public transit, with the employer reimbursing 50per cent of the

cost of a pass on the city-operated public transit system. Similar arrangements have been negotiated by

the Manitoba Government and General Employees’ Union (2014) and other trade unions.

The International Association of Machinists and Aerospace Workers (2010): the agreement provides for

a transport incentive of an amount equal to 85per cent of the cost of a transport pass each month, when

employees use public transport or alternative means. Employees driving to work (including by carpool)

more than four days a month are ineligible.

A collective agreement (2014) negotiated between the Canadian Union of Public Employees (CUPE) and

the Simon Fraser University provides that regular shifts are to be scheduled according to certain public

transport schedules.

The Camosun College Faculty Association and Camosun College agreed (2014) to implement an

Alternative Transportation Dividend Program to reduce the percentage of single occupancy vehicles

parking on campus. Employees who decline parking privileges receive a dividend payment.

Cutting waste,

saving resources

An agreement negotiated in 2012 between the British Columbia Government and Service Employees’

Union (BCGEU, 2012) and the Government of the Province of British Columbia includes a clause allowing

the review of ways in which the employer can reduce workplace consumption of non-renewable and

renewable resources, increase the amount of material that is reused in the workplace, and implement

recycling programmes.

The National Automobile, Aerospace, Transportation and General Workers Union of Canada (2011)

negotiated green provisions that provide, among other measures, that the employer will endeavour to:

use substances in work processes that eliminate or minimize impact on the environment; evaluate all

substances used or produced with a view to substituting them with less hazardous substances; and,

where substances cannot be substituted, evaluate and handle as follows: (i) reuse; (ii) recycle; (iii) dispose

of them in a manner that eliminates or minimizes harm to the environment; or (iv) store them in an

environmentally sound manner.

The Public Service Alliance of Canada (2011) negotiated an agreement providing for a set of guidelines

for energy conservation, insulation, summer savings, appropriate heating use and turning off lights when

they are no longer required.

The right

to refuse

to work

According to the terms negotiated by the International Union of Operating Engineers (2010), employees

may refuse to perform work that would be an offence under provincial environmental legislation.

In the agreement reached between the National Automobile, Aerospace, Transportation and General

Workers Union of Canada (2011) and Canadian Pacic Railway Co., the employer commits to informing

employees that they have the right to refuse hazardous work which may harm the environment, and to

posting signs in the workplace advising them of this right. Under the agreement, no employee may be

penalized for exercising this right. Similar provisions were also integrated into the agreement negotiated

by Unifor in 2013.

Whistle-blower

protection

The National Automobile, Aerospace, Transportation and General Workers Union of Canada, UNIFOR,

and the Canadian Union of Public Employees (CUPE) negotiated a clause in their collective agreements

recognizing the responsibility of employees to notify authorities of the violation of environmental regula-

tions or of a release of hazardous substances to the air, earth or water systems. No employee may be

disciplined for such notication, providing that the company and the health, safety and environment

committee have been notied rst.

Based on Adapting Canadian Work and Workplaces to Respond to Climate Change (ACW), Green Collective Agreements Database,

available at: https://www.zotero.org/green_agreements.

Table 3.7

3. Regulatory frameworks: Integration, partnerships and dialogue 95

GREEN PROVISIONS IN GLOBAL SOCIAL DIALOGUE

Environmental provisions (“green clauses”) have increasingly become a subject of social dialogue

between global union federations (GUFs) and multinational enterprises (MNEs), resulting in the inclu-

sion of environmental issues in international framework agreements (IFAs), alongside labour rights and

principles (box3.6).

IFAs include a wide range of provisions that can make a useful contribution to the debate on the green

transition and greening workplaces and can inform further negotiations by providing specic content

(including language) on environmental issues. The inclusion of green clauses in IFAs is the result of

negotiations in which joint commitments are adopted, which in some cases reect the environmental

policies of MNEs that are already in existence or the negotiation agenda of the GUFs (ETUC, Syndex

and Sustainlabour, 2010). Despite some positive outcomes, it is necessary to recognize the limitations

of IFAs. In comparison with nationally negotiated collective agreements, questions arise about their

implementation and enforcement, and about compliance along the supply chain (Hadwiger, 2015).

IFAs contain “green” provisions

A review of 104 IFAs sheds light on examples of practice relating to the inclusion or promotion of green

provisions.

The majority of IFAs are signed by MNEs with headquarters in Europe. However, more

recently–starting from mid-2000s–some Asian, African and North and Latin American companies

have also signed IFAs. In all, some 20 IFAs have been negotiated by non-European MNEs.

The analysis of the IFAs reveals a number of trends. First, 59per cent of them (61 agreements) include

green provisions in the preamble to the agreement, in a declaration of common understanding or as a

specic commitment in the operative part of the agreement. Some 6per cent of IFAs have been con-

cluded with non-European based MNEs. IFAs concluded by these MNEs also contain green provisions.

42. The number of IFAs is based on publicly available agreements accessed on the website of Global Unions (21 IFAs are signed

by BWI, 46 IFAs by IndustiALL Global Union, 30 IFAs by UNI Global Union, 8 IFAs by IUF, and 3 IFAs by PSI).

International framework agreements (IFAs),

also known as global framework agree-

ments, are agreements between multi-

national enterprises (MNEs) and global

union federations (GUFs). They are volun-

tary instruments concluded through cross-

border social dialogue which promote

minimum labour standards, sometimes re-

ferring to ILS, in MNEs and throughout their

global supply chains (Papadakis, 2008 and

2011). The emergence of IFAs is partially a

response to the absence of a comprehen-

sive body of binding international standards

governing the conduct of MNEs, and the

relative inefciency of national regulation in

ensuring respect for labour rights in certain

situations (Drouin, 2015).

IFAs are important instruments of cross-

border social dialogue for a number of rea-

sons. The vast majority include references to

rights and principles contained in the 1998

ILO Declaration on Fundamental Principles

and Rights at Work, ILO Conventions and

the ILO Tripartite Declaration of Principles

concerning Multinational Enterprises and

Social Policy (revised in March 2017). They

also provide a set of labour standards for a

company’s establishments worldwide that

may be recommended to its suppliers. In

some cases, strong implementation and

monitoring mechanisms are also negoti-

ated. It has been suggested that IFAs are

the building blocks of an emerging cross-

border industrial relations framework

(ETUC, Syndex and Sustainlabour, 2010;

Papadakis, 2008).

International framework agreements

Box 3.6

96 World Employment and Social Outlook 2018 – Greening with jobs

Second, the IFAs reviewed covering the period between 1995 and 2017 show an evolution in the nature

and content of their environmental provisions. Initial generic references to sustainable development

and the environment have developed into more detailed and complex clauses, including provisions on

their enforcement and monitoring, transparency and support for a just transition. The trend is for IFAs

signed in recent years to be more specic and precise in their content and scope of application.

Green provisions in IFAs often contain generic commitments undertaken by the MNE and/or union to

pursue protection of the environment, but without setting out specic objectives, rights or action by

workers and their representatives. Some IFAs do set out specic environmental objectives, for example

in relation to water, waste disposal and the preservation of natural resources, which are formulated in

greater detail and allow for a better implementation framework, monitoring and review.

Third, while OSH and the environment were frequently addressed together in early IFAs, most recent

IFAs include a dedicated provision on environmental issues. This trend can be attributed to: (a) the

increasing importance placed on climate change and environmental policies; (b) the greater involve-

ment of workers in elaborating and monitoring environmental issues at the workplace (ETUC, Syndex

and Sustainlabour, 2010); and (c) the realization that environmental clauses are important to ensure

decent and sustainable jobs.

Fourth, some agreements explicitly acknowledge the environment as a theme of social dialogue. In

one IFA, for example, the MNE commits “to conduct a constructive social dialogue with the employee

representatives in determining its health, safety, environment and quality policy”.

Another pro-

vides that “[g]lobal social dialogue will continue based on this agreement [leading to] … subsequent

agreements in specic areas, for example, in such areas as … sustainable development/climate

change”.

As decisions about production are progressively more inuenced by environmental pol-

icies, the role of the environment will become more prominent in cross-border social dialogue and in

the national context.

The issues covered by green provisions

One of the most frequent “green” commitments in IFAs is related to sustainable development. More

precisely, this commitment is formulated in a general statement by the MNEs parties to IFAs that

“sustainable development is part of doing business”. This statement is present in about 10per cent of

the 216 green commitments

identied in IFAs.

This is followed in importance by a commitment to

respect and/or promote the environment as a corporate objective and social responsibility (about 9per

cent of all green provisions).

Other key commitments endorsed widely in the agreements reviewed include: (a) MNEs being aware

of the environmental impact of their activities; (b) a commitment to respect international agreements,

standards and principles, as well as national environmental legislation; (c) the reduction or manage-

ment of the environmental impact of enterprise activity; and (d) due regard (or due diligence) for the

environment as an overall policy, and specically in conducting enterprise activities.

Table 3.8 lists the most widely endorsed green commitments in IFAs. Most of these commitments are

outward-looking, in the sense that they address the environmental impact of enterprise activities, rather

than environmental action at the workplace. Although general in nature, they may serve as an entry

point for the “recognition of workers’ responsibilities and rights on environmental issues”.

Other green provisions are more specic and target action at the workplace, including encouraging

employees to adopt ecological behaviour, such as energy efciency at the workplace and green

43. See, for example, IFAs concluded with multinationals such as AEON (2014), Lukoil (2014), Total (2015), Tchibo (2016), PSA

Peugeot Citroen (2017).

44. IFA with Total.

45. IFA with GDF Suez.

46. The number of commitments that served as the basis of analysis does not correspond to the number of green provisions found

in an IFA. This is because one green clause may in effect include two or more commitments of a different nature.

47. For a critical commentary on the integration of sustainable development issues in IFAs, see ETUC, Syndex and Sustainlabour

(2010), p.35.

48. Ibid., p.41.

3. Regulatory frameworks: Integration, partnerships and dialogue 97

List of main green commitments in IFAs

Type of green provisions in IFAs Number

of IFAs

Sustainable development as part of “doing business” 22

Respect for, or promotion of, the environment as a corporate objective/social responsibility 19

Awareness by the enterprise of the environmental impact of its activities 17

Respect for international agreements, principles and standards, and national environmental laws 15

Commitment to reduce or manage the environmental impact of company operations 14

Due regard for the environment in general and in carrying out enterprise activities 10

Make efforts and/or achieve improvement in environmental performance 9

A general commitment to adopt a preventive and precautionary approach to the environment

when conducting operations

Promotion and development of environmentally friendly technologies, or a statement of intent

to introduce such technologies

Respect for, or preservation of, the environment and/or natural resources and the protection/preservation

ofbiodiversity

Commitment to take measures to reduce or control greenhouse gases 7

Ensuring that products and production processes display environmental friendliness or compliance

with environmental standards

Sustainable use of natural resources (water, mineral resources, agricultural commodities, fossil fuel, etc.)

and awareness thereof

Raising employees’ awareness of applicable environmental standards 6

Waste management and recycling 6

Source: ILO compilation.

List of innovative but less common green commitments

Innovative green commitments in IFAs Number

of IFAs

Energy eco-efciency (including use and development of alternative energy sources) 4

Encouraging employees to adopt ecological behaviour 4

Termination of relations with contractor or supplier in the event of non-compliance with environmental regulations 3

Workers’ rights as an element of sustainable development 2

Transparency, dialogue on the company’s environmental activities, publicizing environmental assessment reports

or damage caused

Review of the implementation of environmental commitments 2

Support for a “just transition” 1

Social dialogue in determining environmental policy 1

Development of employees’ skills in respect of environmental challenges 1

Adaptation measures adopted in a way that ensures workers’ rights and interests 1

Source: ILO compilation.

Table 3.8

Table 3.9

travel (rationalizing work-related travel and commuting). However, compared with the overall number

of green provisions, the number of innovative provisions entailing workplace-related action is still

modest (table3.9).

It is crucial to address environmental issues as they relate to workplaces, which burn energy, consume

resources, generate waste and travel, to help make jobs more sustainable. Only one green IFA provision

makes reference to a “just transition” and measures of workforce adjustment. It provides as follows:

“Signatory Global Union Federations support reduction of carbon emissions and will co-operate with

[MNE] to ensure that any necessary adaptation takes place in a way that protects the rights and in-

terests of workers and that the impact of any such changes are (sic) designed and implemented in an

agreed, fair manner; [MNE] actively supports ‘Just Transition’ principles.”

49. IFA with GDF Suez.

98 World Employment and Social Outlook 2018 – Greening with jobs

A sector-specic analysis of IFAs reveals that sectors with a high environmental impact may include

more environmental commitments. The oil and gas, energy, chemicals, pulp and paper (which includes

stationery and printing), mining and manufacturing sectors are known to be the largest GHG emitters,

and the total number of IFAs in these sectors (including aerospace and defence) amounts to 37 IFAs

with green provisions.

The analysis shows that green commitments are increasingly included in IFAs.

Further research in

this regard should be conducted to assess the impact of such commitments. Additionally, as noted

earlier, some companies have pursued environmental policies through other voluntary initiatives and

in a decentralized manner at the country level.

The examples provided, both at national and international levels, show that social dialogue could make

a substantive contribution to reducing the environmental impact of the workplace and to combating

climate change. However, in parallel with the steady emergence of environmental unionism, and with

enterprises on board, there is a call to gradually continue incorporating social dialogue into the envir-

onmental debate to go further and to challenge the status quo of global production and consumption

patterns (Barry, 2012). For environmental improvements to occur, social dialogue could focus more on

supporting a qualitative improvement in living standards, rather than maintaining a prevalent framework

of “continuous productive growth” on a planet with limited resources (María-Tomé Gil, 2013).

Conclusions

This chapter has examined whether and to what extent existing legal and policy frameworks consider

labour and the environment as allies that are mutually dependent in order to produce the material

resources necessary for socially, economically and environmentally sustainable development. The

chapter starts by acknowledging that a “just transition law” does not exist, but that it is crucial to take

advantage of the principles embedded in labour law to better utilize the benets of environmental law,

including the priority placed on promoting collective action and dialogue. Moreover, it is difcult to cal-

culate costs and benets related to a green transition since climatic disasters can be rare events, and

such risks might be better covered by protective investments rather than insurance-type of coverage.

Hence the theory of justice underlying labour law may serve as a tool to ensure these investments are

distributed in an equitableway (Doorey, 2017).

ILO Conventions, Recommendations and Protocols offer policies, tools, measures and frameworks,

and promote behavioural changes that can improve the normative framework of sustainable develop-

ment. ILS adopt a dual approach to reconciling social and economic goals with environmental policy.

First, they deal with issues that may cause environmental tensions, such as lack of employment and

inadequate standards of living. Second, ILS can also contribute to the design of policy solutions in

situations of environmental degradation. Over time, ILS, and particularly those on OSH, have evolved

from focusing purely on the protection of workers to include the protection and preservation of the

environment. The universality of ILS is therefore key to the greening of the economy.

The chapter also notes that there are ILS that integrate the environment, however there is yet no single

international labour standard that deals specically with issues related to a just transition. Nevertheless,

other ILO means of action can also be used to promote a transition that is just, including capacity

building and cooperation with other international and regional organizations (Olsen and Kemter, 2013).

Some ILS offer tools for the protection of the environment in areas that remain unregulated or insuf-

ciently regulated by multilateral environmental agreements (MEAs). For example, Conventions Nos170

and 184 contain standards dealing with waste disposal at source, an issue that has not been fully

resolved by international environmental agreements. Similarly, although there is no other signicant

specic international environmental regulation covering agriculture, ILO standards, and particularly

Convention No.184, provide for agricultural processes to be conducted in an environmentally sound

50. For specic case studies on the impact of global framework agreements on global supply chains, see Hadwiger, 2015.

3. Regulatory frameworks: Integration, partnerships and dialogue 99

manner. Admittedly, ILS do not full the direct function of protecting the environment, as envisaged

by environmental law, but they reect the reality that the working environment has a close relationship

with the general environment.

National regulation is increasingly contributing to a better understanding of how legislation and policies

can foster the transition to greening with jobs. In terms of the integration of social goals, the major focus

of climate change policies (both adaptation and mitigation) in relation to labour is on skills (53per cent)

and re-training and job creation (42per cent). There is still a need to improve our understanding and

knowledge base about the impact of different laws, policies and institutional designs and the changes

that they have achieved on the ground as regards employment and decent work. As implementation

of climate policies is beginning to involve courts in some countries, further research is required to

investigate how climate litigation includes just transition dimension. Other issues of crucial importance

must not be neglected, for instance, social dialogue.

Laws and regulations are part of an enabling environment. A well-designed and effective regulatory

framework can promote and encourage a streamlined and systematic approach to the national struc-

tural change required for the transition to green growth. Effective and well-enforced legal frameworks

are also crucial to securing domestic and international investment.

Finally, social dialogue has a key role to play. As decisions about production are increasingly shaped

by environmental policies, the environment will become more prominent in cross-border and national

social dialogue. Social dialogue can act as a useful tool to promote the institutionalization of environ-

mental action at the workplace. Workplace action can help to foster changes in policy and structures,

as well as in individual behaviour, and may prove to be more effective in reducing carbon emissions

than measures taken at the individual level.

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Barry, J. 2012. “Trade unions and the transition from ‘actually existing unsustainability’: from

economic crisis to a new political economy beyond growth”, in N. Räthzel and D.Uzzell (eds):

Trade unions in the green economy: Working for the environment (London,

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4. Protecting workers and the environment 103

KEY FINDINGS

Climate change and other forms of environmental degradation undermine people’s livelihoods;

effective and tailored measures are required to protect workers and their families.

Ensuring a just transition requires a package of benets and services. Income support meas-

ures should be supplemented by job placement, skills retraining and support for relocation. In

particular, unemployment protection schemes can play a key role in supporting a just transition

for workers who lose their jobs in the shift to a more environmentally sustainable economy.

Cash transfer programmes can compensate for the loss of income experienced by households

as a consequence of adverse environmental events or structural changes resulting from the

implementation of green policies.

Public employment programmes have become crucial policy tools that combine economic,

social and environmental objectives in support of adapting to and mitigating environmental

degradation and climate change.

If carefully designed and implemented, payments for ecosystem services schemes can offer

cost-effective protection for the environment, while at the same time supporting household in-

comes.

Projections show that policies that extend transfers (such as unemployment benets, cash

transfers, public employment programmes and payment for ecosystem services), strengthen

social protection and support green investment are nancially viable and conducive to higher

growth, employment creation and fairer income distribution.

Protecting workers

and the environment

104 World Employment and Social Outlook 2018 – Greening with jobs

Introduction

Social protection policies safeguard and promote human rights. They are an essential foundation stone

for ensuring a just transition to a green economy and protecting workers against the detrimental effects

of climate change and other forms of environmental degradation. They are central to economic and

social development strategies, at both national and international level, as recognized in the Sustainable

Development Goals (SDGs). Social protection consists of social and economic measures that protect

people over the life cycle in the face of events that jeopardize their ability to earn income or access

essential services

(ILO, 2017). Universal social protection has highlighted the importance of combining

contributory and non-contributory schemes, integrating a set of policies designed to ensure income

security and support to all people across the life cycle–paying particular attention to people in poverty

and the vulnerable (ILO and World Bank, 2015). The combination of comprehensive social protection

and employment policies can ensure that people enjoy income security throughout the life cycle.

The need for comprehensive and integrated social protection systems is also likely to increase because

of the ongoing negative impact of climate change, such as rising temperatures, changes in precipitation

patterns and the increased frequency and magnitude of natural disasters (see Chapter 1). This will be

reected in stagnant incomes for most households and a chain of deationary effects on consumption,

investment and tax revenues. Through their support for incomes, and for economic security in general,

social protection systems contribute to a just transition to a green economy and to environmental action

in two distinct ways.

First, social protection facilitates the adaptation of individuals and families to environmental deg-

radation and climate change. The term “adaptation” refers to measures aimed at preventing environ-

mental degradation from causing too much environmental damage (e.g. building dams through public

employment programmes) or measures that aim at reducing the social and economic consequences

of environmental disasters (e.g. nancial assistance through cash transfers). For instance, social

protection can be used to protect populations who are victims of adverse environmental events such

as droughts, typhoons, heatwaves or oods. Cash transfers and public employment programmes can

help families affected by extreme climate events or the progressive degradation of the environment

(such as soil erosion and biodiversity loss). This chapter reports evidence that many countries are

adapting their social protection systems or developing new schemes to ensure that they offer support

that is adapted to the situation of people affected by environmental disasters or climate events (ILO

and AFD, 2016a and 2016b). In addition, coverage for employment injury benets for workers who

become victims of an environmental hazard at work, including heatwaves, is a fundamental right as

evidenced in international standards for workers’ compensation dating back to the early days of the

International Labour Organization (see Chapter 3). For example, construction workers in countries

experiencing extremely high temperatures acquire health conditions that necessitate medical treat-

ment and sometimes income replacement if they become disabled and unable to work. The policies

and measures to ensure the right of workers to compensation are integral to several of the Multilateral

Environmental Agreements.

Second, social protection contributes to the mitigation of environmental degradation and climate

change. As shown in Chapter 2, green policies and the transition to sustainable forms of economic

growth will inevitably cause job losses and lead to the elimination of sources of income for some

households. For example, the closure of mines, as being planned in the Philippines, or limitations on

the exploitation of forests, as imposed in China at the end of the 1990s, entail the reduction or sup-

pression of the main or sole source of income for thousands of households (ILO and AFD, 2016c and

2016d). Similarly, the elimination of fuel subsidies, as was recently done in Egypt, is certainly good for

the environment, but it has a long-lasting negative effect on households in poverty that depended on

these subsidies to buy the fuel needed for their own consumption (ILO and AFD, 2016e). These green

policies may therefore not be socially acceptable unless they are accompanied by social protection

measures (such as unemployment protection and social assistance) to support a just transition to a

more environmentally sustainable economy.

In addition to social protection policy tools, the present chapter analyses payments for ecosystem

services schemes. If carefully designed and implemented, these environmental programmes can

1. Social protection includes (i) family allowances to ensure that families have sufcient resources to provide good nutrition,

education and care for their children; (ii)social health protection to ensure that ill health does not push people into poverty; (iii)un-

employment benets to secure household income in the event of loss of jobs; (iv)old-age pensions to ensure that older persons can

live in dignity; and (v)employment injury benets to protect workers in case of accidents or disease resulting from employment.

4. Protecting workers and the environment 105

offer environmental protection while at the same time supporting household incomes. This follows

the approach of Chapter 3, which discusses environmental laws, regulations and policies that include

elements of the Decent Work Agenda.

In this context, this chapter rst discusses the close relationship between poverty, social protection,

income security and the environment. It then analyses four policy areas that can contribute to adaptation

and mitigation measures: unemployment protection, cash transfer programmes, public employment

programmes and payments for ecosystem services. While the examination of unemployment protec-

tion and cash transfer programmes recalls the need for strong social policies to protect people from

adverse environmental impacts and to ensure a just transition to a green economy, public employment

programmes and payments for ecosystem services offer the potential to explore the combination of

economic, social and environmental objectives within one policy measure. After reviewing experience

in these areas, a macroeconomic simulation projects the impact of an increase in environmentally

oriented social protection on the global economy.

A. The link between poverty, social protection,

incomesecurity and the environment

As noted in Chapter 1, people in poverty, indigenous and tribal peoples and other vulnerable population

groups are particularly exposed to the risks and damages associated with environmental degradation

as they tend to have lower capacity to mitigate the social, physical and economical damage. Moreover,

they often rely more heavily than others on ecosystem services for their livelihoods and well-being,

which therefore depend directly on a stable environment. This is particularly the case in rural areas

(Suich, Howe and Mace, 2015).

Some of these groups also often nd themselves locked into environmentally damaging activities,

such as communities for whom deforestation is the only available source of both income and fuel.

Social protection can therefore help to protect vulnerable groups from the effects of environmental

degradation and reduce their reliance on activities that are detrimental to the environment (Duraiappah,

1998; ILO, forthcoming).

Confronted with multifaceted forms of insecurity that are exacerbated by environmental factors, along

with inadequate access to social protection in rural areas, many women and men have been migrating

to urban areas in search of income-generating opportunities. While migration can be an adaptation

strategy, it can nevertheless leave migrant workers vulnerable to discrimination and exploitation in desti-

nation areas, especially urban areas, where they tend to nd employment within the informal economy.

Moreover, relocation to urban areas often also entails living in slums that lack access to basic social

services and resilient infrastructure. In numerous urban centres, slums or informal settlements are

highly vulnerable to environmental shocks and the impacts of climate change. In this context, adequate

access to social protection for workers in urban areas can play a vital role in disaster risk reduction as

well as in providing further opportunities for enhancing adaptive capacity, improving resilience, income

security and positive health outcomes.

Figure 4.1 shows that social protection and environmental sustainability are inextricably linked. Social

protection reduces the nancial impact of environmental degradation, natural disasters and environ-

mental laws and policies. It also provides a secure income and increased adaptive capacity which

mitigates poverty and protects the environment while at the same time increasing tax payments and

social security contributions. For example, if rural households have a guarantee of stable incomes, they

are better able to invest in tools and land use practices that have a positive impact on soil and water

quality and increase carbon sequestration. A well-preserved ecosystem, in turn, makes them less

vulnerable to the negative consequences of environmental effects, shocks and disasters (Schwarzer,

Van Panhuys and Diekman, 2016).

According to Hallegatte et al. (2016), forward-looking scenarios suggest that unmitigated climate

change could drag 100million people into poverty by 2030. This gurecould be reduced substantially

to 20million through the adoption of climate-informed development and pro-poor social protection

106 World Employment and Social Outlook 2018 – Greening with jobs

policies (ibid.). Drawing on this analysis, the following sections critically assess the merits of four

policy instruments, which can be specically (re)designed to address environmental and social issues

and thereby offer an efcient means of achieving progress towards the environmental, social and

economic sustainability objectives embedded in the SDGs. The four instruments are, as mentioned

above: unemployment protection; cash transfer programmes; public employment programmes (PEP)

with environmental components; and payment for ecosystem services (PES) with social components.

B. Unemployment protection and structural transformation

in the context of climate change

As discussed in Chapter 2, efforts to mitigate the root causes of climate change, and particularly to

reduce GHG emissions, may not only improve energy and resource efciency, but also open new job

opportunities in sectors that will benet from the green transition. However, as countries face dif-

cult choices when phasing out carbon-intensive activities, workers whose livelihoods depend on less

environmentally friendly practices require active support to shift towards more sustainable means of

production. Measures are therefore necessary to provide workers with the right skills (see Chapter 5),

facilitate re-employment through job placement services and relocation grants, and protect those who

lose their jobs by means of income compensation measures in the form of unemployment benets,

social assistance or public employment programmes. Regarding the crucial issue of nancing, govern-

ments should–in consultation with social partners and taking into account the economic and scal

capacities available–articulate long-term nancing needs and establish sustainable funding mech-

anisms for the implementation of these measures.

Unemployment protection provides income support over a determined period, as well as facilitating

access to skills development and job placement services for unemployed workers or people who are

looking for a new job (ILO, 2017). This includes workers who lose their jobs due to environmental

laws, regulations and policies such as banning forest exploitation, introducing a shing moratorium or

closing down polluting and unsustainable industries (for example, in the mining sector). By guaran-

teeing unemployed workers and their families income security in the event of job loss, unemployment

protection schemes contribute to preventing poverty, reducing vulnerability and facilitating the tran-

sition to new jobs, particularly if they are combined with skills development, job placement support,

Better access to

social protection

Ex ante and ex post protection

in the case of environmental shocks,

degradation and green policies

• Maintained/improved

income security

• Reduced displacement

• Increased adaptive capacity

• Shift towards greener jobs

• More sustainable land use

• Conservation activities

Environmental conservation

Tax payments and social

security contributions

maintained or increased

Socio-economic and environmental challenges are intricately interlinked

Figure 4.1

Source: ILO Social Protection Department.

4. Protecting workers and the environment 107

and relocation grants. Unemployment protection is a fundamental measure in any social protection

system, as recognized in the ILO’s Social Protection Floors Recommendation, 2012 (No.202). Where

they exist–putting aside for the moment questions of resourcing, coverage and effective implemen-

tation–unemployment protection schemes involve the provision of employment services such as job

matching and counselling, entrepreneurship support and access to enhance, update and develop skills

necessary for workers transitioning from unsustainable means of livelihood to new jobs (ILO, 2014 and

2017; Peyron Bista and Carter, 2017).

Unemployment protection not only plays an important role at the individual level, but also contributes

to stabilizing employment and aggregate demand, providing safeguards against informality and facili-

tating structural change in the economy (Berg and Salerno, 2008). As countries go through processes

of structural transformation, there may be broad population shifts, including rural-to-urban migration

and employment shifts from low-productivity and labour-intensive sectors (such as subsistence and

non-mechanized agriculture) to high-productivity and skills-intensive sectors (industry and services).

These types of resettlement and sectoral shifts often entail increased urban unemployment and in-

formal employment. Adequately resourced and effectively implemented systems of unemployment

benets can therefore support structural transformation towards a greener economy, higher levels of

productivity and inclusive economic development (Behrendt, 2013), as well as a just transition towards

a more environmentally sustainable economy.

In recent years, unemployment protection schemes have been used to soften the effects of job losses

in unsustainable industries by ensuring income security and supporting the reskilling of displaced

workers. Several country examples are relevant. For instance, when in 1998, in an effort to reduce

deforestation, the Government of China imposed bans on logging in natural forests, unemployment

protection measures were used to provide nancial assistance to those affected. Workers were also

offered lump-sum payments, together with training to assist them to open their own businesses. Those

still unable to nd work elsewhere received basic unemployment benet (ILO and AFD, 2016d). There

is also the case of Poland, which–in a bid to mitigate GHG emissions and promote the transition to re-

newable sources of energy–is currently closing uncompetitive coal mines in compliance with European

Union aid regulations and with a view to transitioning towards more sustainable energy sources. As

around 100,000 people work in the Polish coal industry, nancial support (1.9billion euros) is being

provided to those affected by job losses to help in their adaptation to changing labour market demands

in the context of the transition to a more environmentally sustainable economy.

Similarly, following

Romania’s decision to close two uncompetitive coal mining units by 2018, nancial support totalling

54million euros has been earmarked to provide income support to workers who will become un-

employed and to reskill former employees so that they can nd jobs in more environmentally sustainable

professions.

In the Philippines, the planned closure of mines has been put on hold until appropriate

compensation measures are agreed and implemented to support the workers affected and facilitate

their transition to new jobs or locations. These examples show that the transition to a greener economy

cannot be undertaken if the resources to cushion the social costs are not specied in advance.

However, the potential of unemployment protection schemes to support the transition to greener econ-

omies is severely limited by the fact that such schemes do not yet exist in many countries. Even where

they exist on paper, the schemes may cover only a small proportion of workers, often excluding workers

who are underemployed and/or engaged in non-standard forms of employment, indigenous and tribal

peoples, ageing populations and smallholder farmers, all of whom consequently have to rely on informal

community or family support systems. Figure4.2 shows that only around one-third (38.6per cent)

of the global labour force is covered by unemployment protection under national legislation, mostly

through mandatory contributions. Legal coverage ranges from 4.2per cent in sub-Saharan Africa to

over 80per cent in Europe, Oceania, and Northern America, with women being less likely to be legally

covered in Eastern Asia, Northern Africa and Southern Asia. In this context, increases in non-con-

tributory social assistance such as cash transfers (discussed in the next section) simultaneously com-

pensate, at least in part, for non-existent or low coverage of unemployment protection during the

transition to a green economy and strengthen the adaptive capacity of households in the case of slow

and rapid-onset natural disasters. A gender-sensitive approach is required to compensate for existing

disparities and to prevent their emergence in the rst place.

2. See https://www.reuters.com/article/us-poland-coal-subsidies-eu/eu-clears-1-9-billion-polish-support-for-mine-closures-

idUSKBN13D16Y

3. See http://europa.eu/rapid/press-release_IP-16-3981_en.htm

108 World Employment and Social Outlook 2018 – Greening with jobs

C. Cash transfer programmes

A second set of policy instruments, cash transfer programmes, can play a signicant role in strength-

ening the adaptive capacity and resilience of individuals in response to climate change. They can

also support a just transition to a green economy by protecting people from possible loss of income

caused by the implementation of environmental policies. The concept refers to non-contributory

schemes providing cash benets to individuals or households, usually nanced out of taxation, other

government revenue, or external grants or loans. Programmes that provide cash to families subject

to the condition that they full specic behavioural requirements are referred to as conditional cash

transfer (CCT) programmes.

Cash transfer programmes and adaptation strategies

Cash transfer programmes have expanded considerably over recent decades, particularly in low- and

middle-income countries. They are typically designed to address the everyday deprivation faced by

households in poverty, or by certain categories of the general population. In the context of climate

change and environmental degradation, the role that cash transfers can play in strengthening the

adaptive capacity and resilience of individuals and households is widely recognized, particularly in

developing countries, where existing social protection is inadequate (Wood, 2011; Béné et al., 2014).

Wood (2011) identies various channels through which cash transfer programmes contribute to adap-

tive capacity in the context of climate change. First, by helping people in poverty to meet their basic

needs, cash transfers contribute to the reduction of short-term vulnerability. Second, they can provide

support for households affected by climate-related hardship, such as extreme weather events and

100

Percentage of labour force

World

Women

Total

Women

Total

Women

Total

Women

Total

Women

Total

Women

Total

Women

Total

Women

Total

Women

Total

Women

Total

Women

Total

Women

Total

Women

Total

Sub-

Saharan

Africa

South-

Eastern

Asia

Eastern

Asia

Latin

America

and the

Caribbean

Northern

Africa

Southern

Asia

Arab

States

Central

and

Western

Asia

Northern

America

Northern,

Southern

and

Western

Europe

Eastern

Europe

Oceania

Contributory mandatory

Contributory voluntary

Employment guarantee scheme

Other non-contributory programmes

Percentage of workers covered by unemployment protection schemes,

by region, latest year available

Figure 4.2

Note: Regional estimates are weighted by the labour force.

Sources: ILO, 2017, gure3.16, based on World Social Protection Database; ISSA/SSA, Social Security Programs Throughout the World; ILOSTAT, completed

with national statistical data for the quantication of the groups legally covered.

Link: http://www.social-protection.org/gimi/gess/RessourceDownload.action?ressource.ressourceId=54640

4. Protecting workers and the environment 109

slow-onset environmental degradation. Third, they have the potential to reduce pressures to engage in

asset-depleting strategies, which weaken long-term adaptive capacity. By helping vulnerable house-

holds to consider investment decisions and innovations, cash transfers also increase their adaptive

capacity. Finally, in some cases, when climate change makes livelihoods less viable, temporary or

permanent migration can be the only response. In this context, by reducing the costs of migration and

providing a degree of insurance to migrants, cash transfers can facilitate mobility and thus increase the

options available to vulnerable households to improve their adaptive capacity. Another way to facilitate

workers’ mobility and strengthen their adaptive capacity is to ensure portability of social protection

between employers and States.

More recently, certain climate-sensitive features have been added to otherwise pro-poor transfer pro-

grammes in countries such as Kenya and Ethiopia. In Kenya, the Hunger Safety Net Programme

(HSNP) is an unconditional cash transfer programme that builds resilience and reduces extreme

poverty in four arid counties in the northern part of the country. As of November 2017, the HSNP pro-

vides regular electronic and unconditional cash transfers to 100,883 households,

which represents

about 27per cent of households in the region. The transfers are worth approximately US$ 50 and are

paid every two months. Since 2014, systems have started to be built to help the Government of Kenya

put in place the capacity to scale up cash transfers to mitigate the effects of drought. Drought condi-

tions are monitored by satellite. If they reach severe levels in any given month, an additional 25per cent

of households in drought-affected areas receive a one-off emergency payment. If conditions worsen to

extreme levels, then coverage increases to 75per cent of all households. During 2015, HSNP scaled

up four times to provide emergency cash transfers to over 207,000 additional households beyond its

regular beneciary households. The rst three payments were in response to drought and the last pay-

ment was made in anticipation of the El Niño weather system. According to the impact evaluation, the

majority of beneciaries used transfers for food and basic needs, but some were able to pay off debts,

make modest investments in small livestock and contribute to the costs of schooling their children.

There is evidence to suggest that the transfers enabled poorer routine beneciaries to move towards a

better standard of living, which increased their resilience to shocks. However, emergency beneciaries

used transfers almost exclusively to cover basic needs rather than investing in productive assets that

may enhance resilience. As 62per cent of the recipients are women, the programme increased their

purchasing power and hence their visibility as economic actors and improved their status within their

households (Farhat, Merttens and Riungu, 2017; Otulana et al., 2016).

Similarly, in Ethiopia, a cash transfer component of the pro-poor Productive Safety Nets Programme

(PSNP)

provides timely scale-up payments for certain beneciaries in anticipation of droughts or

oods, based on meteorological data indicating the anticipated impact on the food security of bene-

ciaries. A recent study focusing on the impact of Ethiopia’s PSNP on long-term effects of drought

indicates that the negative impact of drought shocks on food security persists for up to four years

after the drought has ended. The study also shows that receiving PSNP payments reduces the initial

impact of drought shocks by 57per cent and eliminates their adverse consequences on food security

within two years (Knippenberg and Hoddinott, 2017). Cash transfer programmes addressing specic

climate-related risks are particularly relevant for countries seeking to develop adaptation measures

to protect households against the nancial losses and damage associated with the impact of climate

change and environmental degradation.

Cash transfer programmes and mitigation strategies

Besides helping climate change adaptation, cash transfer programmes have also been part of public

efforts to address the root causes of climate change. In addition to the negative effects on employment

of the closure of polluting and carbon-intensive industries, some response measures to reduce or

sequester GHG emissions may have an adverse impact on people whose livelihoods or consumption

patterns are tied to unsustainable practices. Cash transfer programmes have been combined with

pro-climate reforms to compensate in part or in full for income losses among those affected by new

restrictions on economic activities or energy consumption.

4. Against a total target of 101,354 households (see: http://www.hsnp.or.ke/index.php/dashboards/at-a-glance).

5. The major component of the PSNP is a public employment programme (discussed in section D below). However, the direct

support component provides cash transfer for those who are unable to work due to disability, illness or age.

110 World Employment and Social Outlook 2018 – Greening with jobs

For example, when China introduced the ban on unsustainable logging, referred to above, nearly

1million state forest workers lost their jobs as a result, and the livelihoods of 120million other rural

workers were affected. However, thanks to the introduction of cash transfers and other social pro-

tection measures to supplement existing protection, four years later two-thirds of the nearly 1million

workers affected had either found other jobs or retired, and some 32million rural households began

to receive cash payments to perform conservation activities. These measures resulted in the affores-

tation of nearly 27million hectares of former farmland and deforested areas (ILO and AFD, 2016c and

2016d). Some years later, in 2013, the Egyptian Government faced drastic and severe scal burden

because of spending 20per cent of the budget on fossil fuel subsidies. These subsidies were reduced

to balance the budget and bring down wasteful consumption and emissions. According to ofcials,

the removal of fossil fuel subsidies could reduce the country’s CO

emissions by 13per cent. The

phase-out of fossil fuel subsidies was inaugurated alongside two new cash transfer programmes to

help offset the impact of substantial fuel price increases on poor and vulnerable households. These

programmes, partially nanced by the government savings, were aimed at two vulnerable groups: one

was tailored for households in poverty and children (Takaful programme) and the second (Karama

programme) provides social pensions for persons with disabilities or aged 65 and above. While the

Takaful programme provides monthly benets of US$ 40.50 per month with top-up payments ranging

between US$ 7.5 and US$ 12.5 per child, the Karama programme provides a payment of US$ 43.50

for each qualifying individual in the household. By 2017, the World Bank estimated that these pro-

grammes covered about 1.5million families (6million Egyptians) out of the 1.7million families tar-

geted (ILO, 2017; ILO and AFD, 2016e; World Bank, 2017).

D. Public employment programmes

The social and environmental potential of public employment programmes

The concept of public employment programmes (PEPs) covers any government programme that dir-

ectly creates employment without expanding the regular civil service. PEPs include emergency public

works programmes (PWPs) such as the Gonaives programme in Haiti, and employment guarantee

schemes (EGS) such as the Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA)

in India, as well as a range of intermediate options. While PWPs are normally a temporary response

to specic shocks and crises (although they can also have a longer-term horizon), EGS are long-term,

rights-based employment programmes that entitle people to work and offer predictable and stable

income while creating needed public assets and services (Lieuw-Kie-Song et al., 2010). PEPs con-

tribute to a fair and just transition.

PEPs target multiple objectives simultaneously, which makes them attractive policy tools. While many

combinations are possible, PEPs are usually aimed at: (i) employment creation and income security;

(ii) poverty reduction; and (iii) the provision of public and/or social goods and services, such as infra-

structure or environmental assets. Many of these environmental programmes, often described as Green

Works, are also contributing to building more climate-resilient adaptive infrastructure contributing to

disaster risk reduction.

The vast majority of PEPs implemented in recent years, particularly in low- and middle-income coun-

tries, have focused on the most vulnerable groups through the enhancement of income security and

the development of health-care, educational, environmental and other public services. In general

terms, PEPs are social protection tools with the objectives of providing temporary employment and

investing in labour-intensive infrastructure in support of the provision of social services (Subbarao et

al., 2013; McCord, 2012). At the same time they are extending social protection schemes in countries

where there is insufcient or inexistent social protection coverage. The ILO’s Social Protection Floors

Recommendation, 2012 (No.202), recognizes PEPs as a means of providing basic social security

guarantees. However, while all PEPs include a social component, there are often trade-offs between

multiple objectives (employment, poverty reduction and the provision of assets and social services).

Thus, policy design and implementation require the prioritization of one function over the others (ILO,

2014), without undermining their potential to achieve secondary or tertiary objectives.

4. Protecting workers and the environment 111

In recent years, there has been renewed interest in PEPs for two main reasons. First, they were part

of the recovery plans and used as countercyclical measures in many countries following the Great

Recession (ILO and World Bank, 2012). For this reason, they are referred to in the ILO’s 2009 Global

Jobs Pact as a response to the risk of long-term unemployment and increased informality, and as

building blocks for social protection systems. Second, a range of innovations in the design and im-

plementation of PEPs has improved their social, economic, environmental and institutional outcomes.

Among these innovative aspects, which include longer-term approaches, broader scale and greater

complementarity with social protection programmes, innovations in the type of work provided under the

programmes are opening up new opportunities for convergence with other policy areas. In particular,

PEPs performing work in the environmental sector have the potential to contribute to climate change

mitigation and adaptation (Lieuw-Kie-Song et al., 2010; Philip, 2013).

The main way in which PEPs can contribute to climate change mitigation and adaptation is through the

work performed. For example, mitigation components of environmental projects usually include jobs

in reforestation, water and soil conservation, while adaptation can be targeted through employment

in ood control and erosion reduction measures. Given their local nature, adaptation can also be

integrated into projects that enhance community resilience. In vulnerable areas heavily affected by

natural disasters and climate change, emergency employment programmes can provide social protec-

tion while at the same time reducing the impact of negative shocks. Employment generated through

rehabilitation and reconstruction following natural disasters is reactive adaptation. The third way in

which PEPs can contribute to environmental objectives is through anticipatory adaptation. As the

majority of PEPs involve the construction of infrastructure, it is possible to integrate PEP projects with

climate adaptation measures, such as improvements in irrigation and drainage systems, roads and

transportation. Mitigation can also be achieved through jobs that target resource efciency in infra-

structure. Importantly, these types of employment offer opportunities to enhance skills for the green

transition (see Chapter 5). Last but not least, these employment-intensive schemes use hands-on

training to raise and strengthen awareness of the importance of climate resilience and the risks of en-

vironmental degradation. PEPs can therefore combine adaptation and mitigation measures with social

protection and poverty reduction, while enhancing local participation and the rehabilitation of natural

resources (Harsdorff, Lieuw-Kie-Song and Tsukamoto, 2011). Many of these programmes also include

a productive component, making them attractive to ensure that they are sustainable and provide the

needed livelihoods.

In this context, PEPs become crucial policy tools to combine economic, social and environmental

objectives through green jobs (box4.1). Their use is likely to increase over the coming years, as cli-

mate change and other forms of environmental degradation add to existing environmental challenges.

Increasing numbers of activities related to the mitigation of and adaptation to climate change can

be expected.

Examples highlighting the potential of environmental PEPs

Three examples illustrate how PEPs can combine social and environmental outcomes: The Mahatma

Gandhi National Rural Employment Guarantee Act (MGNREGA) in India, the Working for Water pro-

gramme in South Africa, and the Productive Safety Net Programme in Ethiopia. All these examples

promote adaptation from and mitigation of environmental risks.

The Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA) in India is aimed at

providing social protection and economic security for rural people in poverty, strengthening drought-

proong and ood management and empowering marginalized communities. Through the MGNREGA,

each rural household is entitled to 100 days of employment a year. People are employed in unskilled

manual work, such as the construction or improvement of community infrastructure, or the gener-

ation of ecosystem services that protect environmental resources. According to the Ministry of Rural

Development, 60per cent of the work hours provided through the programme in 2012 involved water

conservation and 12per cent were related to the provision of irrigation facilities (Das, 2013). The pro-

gramme also increased female labour participation and in some cases women’s autonomy in household

decision-making by providing higher wages than other rural employment opportunities (ILO, 2017).

The Working for Water programme was introduced in South Africa in 1995 as a response to an invasive

alien vegetation species problem that caused damage to the South African economy and its biodiver-

sity, threatened water security and increased soil erosion. Since 2003, Working for Water has been

112 World Employment and Social Outlook 2018 – Greening with jobs

part of the Expanded Public Works Programme. It is a water-clearing PEP that provides unemployed

workers with short-term public contracts to remove water-intensive alien tree and plant species from

local water catchment areas. Working for Water is also aimed at poverty alleviation and specically

targets vulnerable groups by seeking to employ 60per cent women, 20per cent youth and 5per

cent persons with disabilities. The programme has resulted in the clearance of over 1million hectares

of invasive alien plants since 1995, releasing an additional 50million cubic tonnes of a water a year

(Schwarzer, Van Panhuys and Diekman, 2016).

The Productive Safety Net Programme(PSNP) has contributed to improving food security in Ethiopia

through land restoration and reforestation, and has become Africa’s largest climate resilience pro-

gramme. The PSNP has beneted 7.8million persons and supported the restoration of the local

environment. Total expenditure under the PSNP between 2015 and 2020 amounts to US$ 4 billion.

Lieuw-Kie-Song (2009) identies six sets

of circumstances in which environmental

public works programmes can be particu-

larly effective policy options on their own, or

when integrated into other activities.

Circumstances of acute

environmental distress

Depleted natural capital due to acute en-

vironmental degradation, such as deforest-

ation, soil erosion, ash oods and invasive

threats, can reduce the productivity level

of the poor. In this context, investment in

restoring degraded natural capital through

PEPs can create employment opportunities

and raise productivity in the long term.

Complementing other rural

development strategies and schemes

PEPs can complement rural development

programmes by raising agricultural product-

ivity and creating livelihoods. Investment

opportunities in natural capital can be as

diverse as water harvesting, increasing

attractive features for tourism, and main-

taining catchment areas to improve water

supply for local communities, as well as

downstream communities or cities.

Offering alternatives for those engaged

in destruction/over-harvesting

PEPs can provide alternative employment

with better working conditions and income

for poor persons who are engaged in de-

forestation and over-harvesting. PEPs can

direct their labour towards environmentally

sound activities such as reforestation and

other agro-forestry activities, instead of en-

vironmental destruction.

Urban areas with high concentrations

of poverty and unemployment

In urban areas with a high concentration of

poverty, PEPs that include environmental

activities alongside other components can

produce improvements in sanitation, rain-

water capture, the insulation of homes and

the provision of solar water heaters. Other

opportunities could include tree planting,

waste management and recycling.

Responses to natural disasters

PEPs implemented in response to natural

disasters can have both a short- and a long-

term impact. In the short term they can be

used to reverse disaster damage, while

in the long term they can restore the en-

vironment, which can help limit the impact

of similar disasters in future. For example,

mangrove forests can help reduce the

impact of oods and tsunamis, as well as

playing a critical role as breeding grounds

for many species of sh.

Climate change adaptation

PEPs that include adaptation measures can

minimize the impact of climate change and

benet the poor who are directly affected

by providing them with additional income

through employment. Although effective

measures to adapt to climate change are

still being identied, this eld is developing

rapidly and some opportunities can already

be outlined, such as watershed manage-

ment, the construction of dykes or eco-

based adaptive measures to protect against

rising sea levels and water harvesting.

High-impact opportunities for environmentally oriented public employment programmes

Box 4.1

4. Protecting workers and the environment 113

Evidence shows that PSNP public works have improved the capacity to grow food by increasing land

productivity by three to four times, with a positive impact on community resilience. Higher crop yields

have been achieved by reducing soil erosion and sediment loss by 50per cent. The average household

food gap (the total number of days during which households cannot meet their food needs) has fallen

from 3.6 months to 2.3 months. The PSNP has also contributed to the mitigation of climate change by

promoting land use practices that increase carbon sequestration (Fortun, 2017).

Many PEPs include environmental objectives

While most of the literature focuses on national experiences of integrated PEPs combining social and

environmental outcomes, little is known about their implementation at the global level. A rough estimate

is made in this chapter by using the available cross-country data on PEPs with a safety net orientation,

retrieved from Subbarao et al. (2013).

The available data provide information on 86 PEPs covering

62countries in ve regions.

Figure 4.3 shows that 50per cent of the PEPs reviewed include an environmental component, whether

related to mitigation of or adaptation to environmental risks. While 26per cent of the sample integrate

both mitigation and adaptation components, 12per cent include only mitigation work and an add-

itional 12per cent include only adaptation measures. Unsurprisingly, 88per cent of the PEPs focus

on infrastructure. The results also show that 26per cent of the PEPs provide social services such as

health-care and educational services. As each PEP tends to consist of various components, percentage

gures do not add up to 100per cent.

6. The data were obtained from a review of existing research on specic public works programmes implemented over the past

20 years. The data are supplemented by a survey of PEP implementation conducted at the South South Learning Forum: Making

Public Works Work, held in Arusha, United Republic of Tanzania, in 2010. In addition, as explained by Subbarao et al., 2013, the

work focuses on safety net-oriented PEPs.

100

Percentage of programmes

Green

(mitigation & adaptation)

Mitigation

only

Adaptation

only

Infrastructure Other

non-green

Public employment programme components

Figure 4.3

Note: ILO estimates based on the description of the work or projects undertaken under each PEP available in the database. In

view of the limited information available in the data describing the work or projects undertaken under each PEP, a conservative

approach has been adopted, considering mitigation or adaptation components to be present only if they are explicitly men-

tioned. For example, the construction of irrigation canals is considered to be infrastructure work if the objective of reducing

the impact of drought is not mentioned. The percentage of programmes with environmental components may therefore be

underestimated.

Source: ILO calculations based on data from 86 PEPs in Subbarao et al., 2013.

114 World Employment and Social Outlook 2018 – Greening with jobs

At the regional level, gure4.4 shows that Africa has the highest incidence of PEPs that include en-

vironmental components, with 23 out of 36 PEPs including mitigation or adaptation activities. Africa

is also the region for which data are available on the largest number of PEPs. In Asia and the Pacic,

12of the 25 PEPs considered include an environmental component, with six programmes undertaking

both mitigation and adaptation activities, two programmes including only mitigation and four only

adaptation work. In Latin America and Europe, the prevalence of environmental components is lower,

with three out of 14 PEPs including an environmental component in Latin America and four out of nine

in Europe. In the Arab States, the data cover only two programmes, of which only one includes both

mitigation and adaptation activities.

E. Payments for ecosystem services

In line with the discussion on environmental policies that comprise elements of the Decent Work

Agenda (see Chapter3), this section turns to the fourth selected policy instrument, namely payments

for ecosystem services (PES), as a concrete example of an environmental policy with the potential to

achieve social outcomes. With the growing need for integrated policy measures that address social,

environmental and economic challenges, innovative policy tools such as PES are raising considerable

interest. While the previous section discussed the possibility of including environmental components

in PEPs which are primarily designed with a social objective in mind, this section focuses on the inte-

gration of a social dimension into PES schemes originally designed with an environmental objective.

Designing PES with poverty alleviation objectives

Ecosystem services are the benets to humans provided by the ecosystem. They include: provisioning

services (such as the supply of food, water and timber), regulating services (including the regulation of

air quality, climate and ood risks), cultural services (such as the recreational, aesthetic and spiritual

Number of programmes

Africa Asia and

the Paciﬁc

Americas Europe and

Central Asia

Arab States Total

Non-environmental

Adaptation only

Mitigation only

Mitigation and adaptation

Public employment programme components, by region

Figure 4.4

Note: ILO estimates based on the description of the work or projects undertaken under each PEP available in the database. In

view of the limited information available in the data describing the work or projects undertaken under each PEP, a conservative

approach has been adopted, considering mitigation or adaptation components to be present only if they are explicitly mentioned.

For example, the construction of irrigation canals is considered as infrastructure work if the objective of reducing the impact

of drought is not mentioned. The number of programmes with environmental components may therefore be underestimated.

Source: ILO calculations based on data for 86 PEPs in Subbarao et al., 2013.

4. Protecting workers and the environment 115

benets of ecosystems) and supporting services (including soil formation, pollination and nutrient

cycling) (MEA, 2005). As Chapter 1 shows, environmental degradation limits the ability of ecosystems

to provide these services, threatening individual health and well-being and economic activity. As most

ecosystem services are not priced, they therefore constitute implicit subsidies to those that enjoy them,

with no liability if their provision ceases (Smith et al., 2013). Adequate pricing, which can include the

benets that ecosystem services bring to jobs, can go a long way towards generating incentives for the

services to be maintained, in addition to providing revenue for individuals and communities (Barbier

and Markandya, 2013; Gómez-Baggethun et al., 2010; Pagiola, Arcenas and Platais, 2005). In this

context, PES have attracted considerable interest as a means of preserving ecosystem services through

markets (Daw et al., 2011; Jayachandran et al., 2017; Schwarzer, Van Panhuys and Diekman, 2016).

In recent years, many studies have highlighted the potential positive effect of PES on the livelihoods

of smallholders (Grieg-Gran, Porras and Wunder, 2005; Pagiola, Arcenas and Platais, 2005; Wunder,

2008; Zilberman, Lipper and McCarthy, 2008).

The basic principle behind all PES is that resource users and communities (usually land owners) who

are in a position to provide environmental services should be compensated for the cost of their provision,

and that those who benet from these services (private, public or a combination of both) should pay

for them, thereby internalizing the benets

(Mayrand and Paquin, 2004; Pagiola and Platais, 2002).

In this context, a growing body of evidence demonstrating that people in poverty are providers of envir-

onmental services means that PES have the potential to combine their initial environmental objectives

with social objectives. The specic characteristics of PES programmes (see box 4.2) and the areas

in which they are implemented are likely to play a critical role in the relationship between PES and

poverty (Pagiola, Arcenas and Platais, 2005). While in some cases PES can achieve both objectives in

a cost-effective manner, in others their socio-economic and institutional context is such that poverty

alleviation and environmental protection objectives compete. If the poverty alleviation components of

PES programmes come at the expense of the environmental service, the programmes may fail, in which

case neither the environmental conservation nor the poverty reduction objectives will be achieved

(Wunder, 2005). For instance, when people in poverty and vulnerable people are included in PES

programmes, they are often relatively low-cost providers of environmental services. The economic op-

portunity cost for poor participants is lower than for others, in view of the lack of viable alternative eco-

nomic opportunities. This makes them attractive participants in PES schemes. However, the ecological

impact of the services they provide may be limited in comparison with ecological assets for which op-

portunity costs are much higher (such as the prevention of industrial-scale land development). When

the socio-economic and institutional context allows, the issues related to trade-offs between environ-

mental and social objectives can be addressed by the design and implementation of the programmes.

The integration of economic, ecological and social criteria into the design and implementation of

PES makes them more complex, but may in some cases lead to them supporting sustainability by

promoting economic resilience, environmental integrity and social development (FAO, 2011). A key

question when designing such programmes is whether any constraints prevent people in poverty

from entering them. If formal land title is not secured, PES that require land ownership or a minimum

land size for participation are likely to exclude the landless poor and smallholders (Pagiola, Arcenas

and Platais, 2005; Wunder, 2005). Similarly, complex and/or expensive application processes may

lead to the exclusion of people in poverty. It is therefore important to keep the application process as

simple as possible and, if necessary, to provide free (or low-cost) assistance. If the programme is to

be effective in reducing poverty, the nancial impact of the payments has to be sufcient to increase

the total income of the participants. For this to be the case, the net payments made have to exceed

the opportunity cost, which includes income from previous land use and transaction and investment

costs. This is often assumed to be the case, as providers supposedly enter PES contracts on a voluntary

basis. However, opportunity costs need to be carefully considered and estimated in order to determine

the appropriate level of compensation (Schwarzer, Van Panhuys and Diekman, 2016). A PES scheme

can also strengthen–or lead to the creation of–community associations, especially if the contracts

are signed with the community, or if agreements are negotiated on a collective basis. In the latter case,

coordination between potential providers at the community level can give individuals more bargaining

7. In recent decades, the denition of PES has been the subject of intense debate. Wunder (2015) revisited his work to take into

consideration the criticisms and analyses made in the literature. According to the new denition, PES are “voluntary transactions

between service users and service providers that are conditional on agreed rules of natural resource management for generating

offsite services”. In practice, many PES schemes do not meet all these criteria. The difculty in reaching consensus on the den-

ition of PES reects the great variety in their design.

116 World Employment and Social Outlook 2018 – Greening with jobs

Types of environmental services provided:

• Carbon sequestration and storage, usually in

accordance with climate change mitigation ob-

jectives. For example, polluting companies in

industrial areas can pay farmers in the tropics to

plant more trees and maintain forests to offset

their carbon footprint.

• Biodiversity protection, with the aim of main-

taining or increasing biodiversity against a variety

of land uses. For example, farmers are paid to set

aside their land for conservation or to reduce their

agricultural activity on such lands. Environmental

service buyers of this type are often conservation

organizations, ecotourism or wildlife companies,

or governments (Wunder, 2005).

• Watershed protection, to reduce the negative

impact of upstream water users on water quan-

tity and quality. For example, downstream water

users (which may be companies or households)

pay upstream farmers to adopt sustainable land

use practices.

• Landscape beauty, to maintain biodiversity and

ecosystem qualities that contribute to natural

beauty. This type of PES scheme often includes

tour operator companies on the demand side and

farmers or foresters on the supply side.

A majority of PES schemes target single envir-

onmental services, but some target multiple ser-

vices. For example, the National Payment for

Environmental Services programme in Costa Rica

rewards forest owners for the four types of services

mentioned above (Schwarzer, Van Panhuys and

Diekman, 2016).

Sectors nanced:

• Public PES schemes are managed and nanced,

often through taxes, by a local or national cen-

tralized public administration acting as a buyer

on behalf of the public or a group of private end

users. These programmes are often large scale,

nationwide and include side objectives, such as

livelihood impacts, community development and

pro-poor action.

• Private schemes are often on a smaller scale and

focus on a local area, in which buyers pay service

suppliers directly (or through intermediaries, such

as forestry funds, commodity funds or NGOs).

• Donor-led schemes are encouraged and nanced

by international donors, such as the GEF, the

World Bank, IFAD and CARE. These schemes

tend to support smaller scale and more locally

focused programmes within larger initiatives

covering more than one country, such as the

IFAD Rewarding Upland Poor for Environmental

Services (RUPES) programme.

In practice, PES schemes are often a combination

of the above. Government-nanced PES schemes

may receive partial funding and technical support

from international organizations, and donor-led pro-

grammes tend to incorporate private companies

with the aim of the contracts being taken up by

private users after the donations fade out (Ezzine-

de-Blas et al., 2016).

Forms of land use:

• Use-restricting, whereby areas under conserva-

tion or protection are set aside, and service pro-

viders receive compensation for the opportunity

cost of not using the resource. For example,

under China’s Sloping Land Conversion Pro-

gramme (SLCP), farmers in erosion-prone areas

volunteer to set aside part of their cropland and

receive compensation that is higher than the op-

portunity cost.

• Asset-building PES schemes, through which

payments are made for efforts to improve envir-

onmental services (for example, through affores-

tation and reforestation).

While “use-restricting” can by denition generate

additional income through compensation, it limits

the creation of new economic activities. In contrast,

“asset-building” allows the creation of new jobs and

innovative value aggregation chains, and therefore

develops sustainable “exit doors” and provides

better safety nets for households (Schwarzer, Van

Panhuys and Diekman, 2016).

Forms of payment: payments under PES schemes

can be in cash or in kind, or a combination of both:

• Cash payments can be one-off payments from

buyers to an intermediary fund, which are then

distributed to service providers during contract

periods or paid on a more regular basis, for ex-

ample as a wage to conservationists and foresters.

• In-kind payments can take many forms, ranging

from the provision of planting materials and

tools to capacity-building, training and technical

assistance. A more indirect channel of in-kind

payment is through social services such as

education, health care and infrastructure devel-

opment.

Spatially, schemes can vary from local (ranging

from very small programmes to medium and large

sizes) to schemes carried out on a national scale.

Features of payments for ecosystem services (PES) schemes

Box 4.2

4. Protecting workers and the environment 117

power and reduce transaction costs (Grieg-Gran, Porras and Wunder, 2005; Pagiola, Arcenas and

Platais, 2005; Schwarzer, Van Panhuys and Diekman, 2016; Wunder, 2005).

Another concern that needs to be addressed is the potentially negative impact of PES on the non-par-

ticipating poor. First, there may be a drop in employment opportunities if the alternative land use

promoted by the scheme is less labour intensive (Wunder, 2005). However, Chapter 2 shows that

sustainable methods of production can be more labour intensive. Second, people who are not partici-

pating in a PES scheme may be priced out of the services it provides, in the sense that they may now

have to pay for the service which, since it is now priced, may become unaffordable. They may also be

affected indirectly through a rise in the cost of living resulting from higher food prices (Schwarzer, Van

Panhuys and Diekman, 2016).

Growing interest in PES schemes with social objectives

In recent years, as the interest of policy-makers has grown in the potential of PES schemes to address

environmental degradation as well as poverty reduction, some countries have begun to change the

design of PES. For example, the Payment for Environmental Services (PPSA) scheme in Costa Rica and

the Payment for Hydrological Environmental Services (PSAH) scheme in Mexico did not originally have

an anti-poverty objective, but have become pro-poor over time. In other countries, social dimensions

have been included in existing PES schemes from the outset, such as the Social Forest programme

in Ecuador and the Bolsa Verde in Brazil, which link an existing social protection programme with a

PES approach.

At the global and regional levels, there are several multi-country actions and learning initiatives to

promote the development of local PES schemes with an anti-poverty focus. The most important are

global initiatives, such as Reducing Emissions from Deforestation and Forest Degradation and the

role of conservation, sustainable management of forests and enhancement of forest carbon stocks

(REDD+) and Ecosystem Services for Poverty Alleviation (ESPA), as well as regional initiatives such as

Rewarding Upland Poor for Environmental Services (RUPES) in South-East Asia and Pro-poor Rewards

for Environmental Services in Africa (PRESA). All these initiatives cover regional action sites in different

countries, combined with a focus on research and a platform for the exchange of experience and the

development of lessons for future projects. There are also international and regional exchange groups

focusing on PES, including the Katoomba Group, an international network serving as a forum for the ex-

change of ideas and information about PES and for collaboration between practitioners on PES projects

and programmes. The East African Forum for Payment for Ecosystem Services is an interactive regional

forum for the exchange of knowledge, ideas and experience, which also provides support for ongoing

and emerging PES projects in East Africa and beyond (Schwarzer, Van Panhuys and Diekman, 2016).

In line with these recent trends, gure 4.5 suggests that PES programmes nanced by governments

and non-prot organizations are more likely to include a pro-poor objective than privately funded

schemes. While 19per cent of the privately funded PES reviewed include a pro-poor focus, the g-

ures are respectively 40 and 36per cent for non-prot and publicly funded PES, which also focus

on poverty alleviation. It would also appear that 47per cent of the large national programmes (often

nanced through public funds) include a pro-poor focus, compared with 27per cent of local schemes

(usually privately nanced). The results also suggest that PES that include carbon sequestration are

more likely to be pro-poor than those focusing on other environmental services.

At the regional level,

PES schemes are more common in Latin America than in other regions. However, a larger share of the

schemes have a pro-poor focus in Asia and the Pacic and Africa.

Althought estimates suggest that a signicant number of PES already include poverty alleviation ob-

jectives, monitoring the impact of PES on ecosystems and poverty is crucial to measuring their envir-

onmental and social outcomes and longevity.

8. “The nature of the environmental service often determines whether the poor can participate. In the case of watershed ser-

vices, once a particular catchment has been identied for providing hydrological services, the program is bound to work with the

communities that live in that catchment, irrespective of their socioeconomic status. On the other hand, land users anywhere in

the world can provide carbon sequestration services. Poor farmers who depend on marginal lands can provide carbon seques-

tration services more cheaply than farmers in industrialized countries, where land prices and opportunity costs are much higher.

Therefore, many carbon projects, such as the World Bank’s BioCarbon Fund, are able to target poor communities for providing

carbon sequestration services.” (Jindal and Kerr, 2007, p.4).

118 World Employment and Social Outlook 2018 – Greening with jobs

(a) Pro-poor PES programmes by funding source

Number of programmes

(b) Scale of PES programmes

Number of programmes

(d) Pro-poor PES programmes by region

Number of programmes

Private commercial Private non-proﬁt Public

Pro-poor

Not pro-poor

Pro-poor

Not pro-poor

Pro-poor

Not pro-poor

Pro-poor

Not pro-poor

Local National

Watershed Climate

change

Biodiversity Landscape

beauty

Others Africa Americas Asia and

the Paciﬁc

Europe and

Central Asia

0 0

Pro-poor components in payment for ecosystem services (PES) schemes

Figure 4.5

Note: Data for 94 PES programmes consolidated from Schwarzer, Van Panhuys and Diekman, 2016, and Ezzine-de-Blas et al., 2016. Programmes listed in

both sources are combined. Programmes with a pro-poor focus are those that either explicitly mention poverty reduction in their objectives or are assessed

as having pro-poor effects in the socio-economic impact sections in the literature. Due to limited data collection from the literature review, a conservative

approach is adopted in counting pro-poor programmes, as not all the literature analyses socio-economic impacts. Due to the differences between the two data

sets in categorizing nancing, the nancing sector is dened as public, private commercial or private non-prot, as in Ezzine-de-Blas et al., 2016. Programmes

classied as donor-led in Schwarzer, Van Panhuys and Diekman, 2016, are classied as either public (if the majority of funding is from international organ-

izations or provided as aid) or private non-prot (if the majority of funding is from NGOs, foundations or grassroots organizations).

Source: ILO calculations based on 94 PES programmes in Schwarzer, Van Panhuys and Diekman (2016) and Ezzine-de-Blas et al., 2016.

4. Protecting workers and the environment 119

F. Simulation

In this section, a simulation model is applied to help illustrate the overall effect of the social protection

policies examined in this chapter. Using the United Nations Global Policy Model, we project the impact

of a policy package containing PEPs, PES, cash transfers, unemployment insurance and investment in

clean energy on growth, employment and income distribution.

A simulated policy package shows benets

The simulation covers the global adoption of a policy package in support of household and workers’

incomes for the promotion of sustainable growth. The term “sustainability” is used in this context in

both an environmental sense, as growth that does not rely on the greater use of fossil fuels, and an

economic sense, as a growth pattern that eschews the accumulation of macroeconomic imbalances

which may lead to instability. To achieve this double goal, changes are examined in social protection

policy, taxation, primary income distribution and energy policy.

Two changes are assumed in social protection policy (gure4.6). First, social transfers are assumed to

increase as a result of payments for environmental services, public employment programmes and cash

transfers. The increase is assumed to be faster in countries with a lower ratio of total transfers to GDP

(where the ratio is assumed to increase by 1.5per cent a year), and slower in other countries (0.75per

cent a year). To justify this assumption, one may argue that those countries which have already put in

place the relevant programmes to be scaled up have lower needs in terms of extending the coverage

or the level of benets. Developing countries, which often tend to experience higher levels of growth

as well as lower social protection system coverage, have more needs to be met and more potential to

extend social protection, provided they have the scal space and the institutional capacity to do so in

the rst place. In the short term, this rise in spending is compensated by a rise in direct taxes, with

more emphasis on marginal rates. A greater increase on marginal rates contains the impact of direct

income support on aggregate consumption. Indeed, a drive towards higher consumption may lead to

unsustainable, short-term, high-interest borrowing, which is likely to generate nancial bubbles. In the

longer term, the increase in social spending pays for itself, as higher growth and employment generate

higher tax revenue.

0.9

1.8

2.7

3.6

(a) Government transfers to GDP ratio (differences

beween the green scenario and the baseline)

(b) Labour shares (differences between

the green scenario and the baseline)

Percentage points

0.8

1.6

2.4

Percentage points

0 0

Developing countries

Developed countries

Developing countries

Developed countries

2018

2019

2020

2021

2022

2023

2024

2025

2026

2027

2028

2029

2030

2018

2019

2020

2021

2022

2023

2024

2025

2026

2027

2028

2029

2030

Social protection policies for a green economy

Figure 4.6

Note: The lines in each panel represent differences between the two scenarios. For example, in panel (a) the lines indicate that transfers/GDP ratios are

increasingly higher in the green scenario compared to the baseline scenario.

Source: ILO calculations based on the United Nations Global Policy Model.

120 World Employment and Social Outlook 2018 – Greening with jobs

Japan

–6

1990 1995 2005 2015 20252000 2010 2020 2030

France

–6

1990 1995 2005 2015 20252000 2010 2020 2030

China

–6

1990 1995 2005 2015 20252000 2010 2020 2030

Saudi Arabia

–6

1990 1995 2005 2015 20252000 2010 2020 2030

Mexico

–6

1990 1995 2005 2015 20252000 2010 2020 2030

Australia

–6

1990 1995 2005 2015 20252000 2010 2020 2030

Italy

–6

1990 1995 2005 2015 20252000 2010 2020 2030

India

–6

1990 1995 2005 2015 20252000 2010 2020 2030

Turkey

–6

1990 1995 2005 2015 20252000 2010 2020 2030

South Africa

–6

1990 1995 2005 2015 20252000 2010 2020 2030

United States

–6

1990 1995 2005 2015 20252000 2010 2020 2030

United Kingdom

–6

1990 1995 2005 2015 20252000 2010 2020 2030

Other EU

–6

1990 1995 2005 2015 20252000 2010 2020 2030

Republic of Korea

–6

1990 1995 2005 2015 20252000 2010 2020 2030

Argentina

–6

1990 1995 2005 2015 20252000 2010 2020 2030

Canada

–6

1990 1995 2005 2015 20252000 2010 2020 2030

Germany

–6

1990 1995 2005 2015 20252000 2010 2020 2030

–7.5

7.5

Russian Federation

–15

1990 1995 2005 2015 20252000 2010 2020 2030

–10

–5

Indonesia

–15

1990 1995 2005 2015 20252000 2010 2020 2030

Brazil

–6

1990 1995 2005 2015 20252000 2010 2020 2030

green scenario

baseline scenario

green scenario

baseline scenario

green scenario

baseline scenario

green scenario

baseline scenario

GDP growth rate (baseline scenario vs green scenario), selected countries

Figure 4.7

4. Protecting workers and the environment 121

Japan

–6

1990 1995 2005 2015 20252000 2010 2020 2030

France

–6

1990 1995 2005 2015 20252000 2010 2020 2030

China

–6

1990 1995 2005 2015 20252000 2010 2020 2030

Saudi Arabia

–6

1990 1995 2005 2015 20252000 2010 2020 2030

Mexico

–6

1990 1995 2005 2015 20252000 2010 2020 2030

Australia

–6

1990 1995 2005 2015 20252000 2010 2020 2030

Italy

–6

1990 1995 2005 2015 20252000 2010 2020 2030

India

–6

1990 1995 2005 2015 20252000 2010 2020 2030

Turkey

–6

1990 1995 2005 2015 20252000 2010 2020 2030

South Africa

–6

1990 1995 2005 2015 20252000 2010 2020 2030

United States

–6

1990 1995 2005 2015 20252000 2010 2020 2030

United Kingdom

–6

1990 1995 2005 2015 20252000 2010 2020 2030

Other EU

–6

1990 1995 2005 2015 20252000 2010 2020 2030

Republic of Korea

–6

1990 1995 2005 2015 20252000 2010 2020 2030

Argentina

–6

1990 1995 2005 2015 20252000 2010 2020 2030

Canada

–6

1990 1995 2005 2015 20252000 2010 2020 2030

Germany

–6

1990 1995 2005 2015 20252000 2010 2020 2030

–7.5

7.5

Russian Federation

–15

1990 1995 2005 2015 20252000 2010 2020 2030

–10

–5

Indonesia

–15

1990 1995 2005 2015 20252000 2010 2020 2030

Brazil

–6

1990 1995 2005 2015 20252000 2010 2020 2030

green scenario

baseline scenario

green scenario

baseline scenario

green scenario

baseline scenario

green scenario

baseline scenario

(cont’d)

Figure 4.7

Source: ILO calculations based on the United Nations Global Policy Model.

122 World Employment and Social Outlook 2018 – Greening with jobs

Second, it is assumed that social insurance policies, including unemployment insurance, will be strength-

ened through increases in social security contributions. These increases could represent a larger share

of workers being covered against various risks (old age, poverty, work accidents, unemployment, etc.),

or higher benets. This is reected in the simulation of an increase in the labour share of income, which

includes employees’ compensation and employers’ social security contributions. Even though tax in-

creases rarely enjoy public support, there are a number of examples in recent years suggesting that,

depending on national circumstances, increases in social security contributions are feasible. In Brazil

and other emerging economies, targeted measures for small and medium-sized enterprises have re-

sulted in an increase in the number of workers being covered by social security. In Spain, self-employed

workers were granted the right to unemployment benet compensation under certain circumstances in

2007, following the adoption of the Self-employed workers’ statute (Estatuto del Trabajador Autónomo).

A survey of 77 countries’ response to the nancial and economic crisis of 2008 revealed that a large

number of them adopted expansionary measures, usually with a limited time frame, such as facili-

tating and extending access to existing unemployment benets, increasing the maximum period during

which benets were paid, raising the level of benets, and adopting work-sharing arrangements (also

called partial unemployment benets) (Bonnet, Saget and Weber, 2012). Two countries – Uruguay and

VietNam – adopted new unemployment insurance schemes during the crisis period.

Energy policy is represented in the simulation by the ratio of carbon energy to non-carbon energy use.

Although admittedly narrow, this measure makes it possible to set ceilings for the expansion of carbon

energy use, and the related emissions, reecting those negotiated in international agreements such

as the Kyoto Protocol and the Paris Agreement. However, no specic inference is drawn regarding

the application of these agreements. The simulation calls for a reduction of total CO

emissions and a

decrease in overall energy demand. It is assumed that the fall in overall energy demand is met by in-

creasing the supply of non-carbon energy and reducing that of carbon energy. The general implication

of these assumptions is the requirement for the economy to become more energy efcient, reversing

a long-standing trend.

Finally, it is important to note that stimulus measures (such as increases in social spending and incen-

tives for green investment) are balanced by countervailing measures (such as increases in taxes) to

make sure that growth exceeds the baseline level by at least 0.25per cent.

The results are encouraging; indeed, 12 years after the introduction of the package, improvements are

projected in GDP growth, employment, income distribution and energy efciency. By 2030, the last year

of the projections, all regions and almost all countries show positive effects on GDP growth (gure4.7).

Over the same time horizon, an increase in employment rates of approximately 0.2per cent is projected

in developed countries and 0.55per cent in developing countries (gure4.8). The larger increase for

developing countries makes sense given the high level of underemployment in these countries. Based

on labour force projections, these effects imply the net creation of approximately 2million jobs in de-

veloped countries and 29million jobs in developing countries. Compared to a projected labour force of

approximately 3.7 billion workers in 2030, these gures are not high, but they nevertheless indicate that

a “green economy” can be achieved incrementally, without labour being sacriced.

0.4

0.6

0.2

2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030

Developing countries

Developed countries

Employment rate (difference between the green scenario and the baseline scenario)

Figure 4.8

Source: ILO calculations based on the United Nations Global Policy Model. The graph represents the difference in percentage

point employment rates between the two scenarios.

4. Protecting workers and the environment 123

Conclusions

Social protection systems are the rst line of defence against the negative impact on incomes of climate

change and environmental degradation. Indeed, social protection and environmental sustainability

are inextricably linked. By reducing vulnerability to social risks, providing secure income and better

access to health care and other basic services, social protection can reduce poverty and protect the

environment. Social protection policies also support the economy by stabilizing household incomes

and aggregate demand.

Four policy areas in particular, namely unemployment protection, cash transfer programmes, public

employment programmes (PEPs) and payments for ecosystem services (PES), if properly resourced

and effectively designed, offer synergies between social protection, environmental policy and macro-

economic policy. These programmes can target environmental and social protection objectives in an

efcient manner, either simultaneously or as part of a policy mix.

Investing in people through unemployment protection schemes helps to prevent and reduce poverty

by providing immediate income replacement for those who lose their earnings as a result of structural

change and efforts to mitigate climate change. In addition, unemployment protection schemes provide

support to workers for the development of their capacities in the long term by facilitating their access

to new jobs in sustainable sectors and strengthening their employability. As a crucial element of struc-

tural transformation and a just transition towards sustainable economies and societies, unemployment

protection needs to be part of any long-term strategic planning for climate-related action. However,

the potential of unemployment protection schemes to support the transition is limited by their low

coverage. In this context, increases in non-contributory social assistance such as cash transfers and

PEPs may simultaneously compensate for non-existent or low coverage of unemployment protection

and strengthen the adaptive capacity of households in the event of natural disasters.

While social protection policies protect households against loss of income resulting from environmental

degradation, they also protect them against the possible negative effects of environmental policies on

their livelihoods. Well-designed social protection systems can also facilitate the transition to environ-

mentally sustainable methods of production that contribute to slowing the pace of climate change.

Ensuring portability of social protection between employers and States as well as implementing cash

transfers for victims of the effects of environmental degradation can facilitate mobility and thus increase

the options available to poor and vulnerable households to improve their adaptive capacity.

Analysis of the available data on PEPs and PES provides evidence that the integration of a combination

of social and environmental objectives in environmental and social policy tools is arousing interest

in many countries and regions. The results show that half of the 86 PEPs surveyed in 62 countries

include an environmental component, either related to mitigation or to adaptation to environmental

risks. Moreover, although PEPs are usually aimed at infrastructure investment, they often provide

health care, education and other benets. They are powerful tools to address the impact of climate

change on workers and their incomes, while also enhancing mitigation. Similarly, it has been shown

that PES, although originally conceived with an environmental objective, can also be effective in sup-

porting household income. This is already the case in more than one-third of non-prot and publicly

funded PES, which target poverty alleviation and environmental conservation simultaneously. In view

of the complexity of the linkages between poverty and the environment, and the danger of vulnerable

segments of the population being excluded or priced out, it is important to monitor the environmental

and social impacts of PES to ensure their durability.

Beyond their beneciaries, social protection systems also have the potential to benet the economy and

society as a whole. A modelling exercise shows that a policy mix comprising transfers (such as cash

transfers, PEPs and PES), stronger social insurance and limits on the use of fossil fuels leads to faster

economic growth, stronger employment creation and fairer income distribution, while also achieving

lower GHG emissions.

As outlined above, the transition to greener economies and societies requires stronger social protection,

including both income security and health protection, based on a life-cycle approach. The strength-

ening of social protection systems, including social protection oors, is therefore one of the elements

of an integrated policy response in support of the just transition toward environmentally sustainable

economies and societies for all.

124 World Employment and Social Outlook 2018 – Greening with jobs

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5. Skills for the green transition 129

KEY FINDINGS

Some countries have been successful in integrating skills development with environmental

policy, particularly in key priority sectors such as renewable energy and energy efciency.

Most countries, however, have not established sound linkages between their environmental

sustainability plans and skills policies.

In the majority of countries surveyed (21 out of 27), skills mismatches are identied as major

obstacles to the greening of the economy. The lack of knowledge of the environment–skills

nexus, the absence of regularly conducted employment projections and of nancial mech-

anisms to promote investments in skills development for the green transition and the sluggish

participation of social partners are still hindering the achievement of an effective transition.

There are signs of emerging policy coherence in some countries, where environmental sus-

tainability policies make explicit reference to skills and/or human resource development or fully

edged skills development policies and legislation for green transition are set up. However,

these references are often limited to specic areas such as skills needs identication and initial

Technical and Vocation Education and Training (TVET).

Most of the countries surveyed (22 out of 27) have established platforms to anticipate skills

needs and adapt TVET systems in general. Of these 22 countries, 19 have addressed issues

related to developing skills for the green transition. Four of the sample countries have estab-

lished specic bodies to consider the question of skills for the green transition. Discussions

on skills for the green transition tend to be led by governments, with some involvement of

employers, and to a lesser extent of trade unions. The involvement of social partners improves

the matching of skills demand and supply, and equity outcomes, including gender equality.

Policies and programmes on skills for the green transition tend to adopt a sectoral approach.

Skills interventions in renewables and energy efciency have been implemented, based on

the legal requirements for vocational certication and training set out in the regulations. They

highlight the relevance of the regulatory framework to integrate environmental and decent work

outcomes, as discussed in Chapter3. Other sectors with green potential have been promoted

through more ad hoc skills development projects, often relying on international support.

The evolving nature of skills for green transition, the absence of consensus on the denition

of green jobs and the lack of labour market information and analysis make it difcult for

policy-makers to devise a long-term and economy-wide skills policy portfolio.

The sustainability of policies requires coordination among stakeholders and overall political

stability at the national level. Social dialogue and good governance are therefore imper-

ative. In addition, raising awareness of environmental issues among the general public and

policy-makers is required to ensure the sustainability of policies in the medium to long term.

Skills for the green

transition

130 World Employment and Social Outlook 2018 – Greening with jobs

Introduction

Both the Sustainable Development Goals (SDGs) and the ILO Guidelines for a just transition towards en-

vironmentally sustainable economies and societies for all (ILO, 2015a) are vehicles to mainstream and

advance decent work and environmental sustainability. Alongside an integrated legal framework (see

Chapter3) and social protection (see Chapter4), skills development is a key component of a response

to environmental challenges that also promotes decent work. Skills development can promote innov-

ation, investment and competitiveness, which in turn feed back into social development, thus creating

a virtuous cycle (ILO, 2010). Through green jobs (see Chapter2), skills development can accelerate

the transition to a green economy.

The transition to a green economy entails changes in the production system on a scale equivalent to an

industrial revolution. Advancement in technologies, innovation and changes in production processes

are major drivers of green transition, thus their implications for the world of work attract the attention

of policy-makers around the world. As noted in Chapter2, jobs will be created in certain sectors and

destroyed in others, while those that remain will also change dramatically, as in any structural trans-

formation. The anticipation and monitoring of skills needs, the provision of the right set of skills and

the recognition of workers’ skills will help workers to move more easily to sectors with employment

growth, and also to better jobs, hence increasing their resilience to potential job displacement and

income losses resulting from economic change (OECD, forthcoming), including the transition to a

green economy.

Skills are key to making the transition to a green economy that advances decent work. Our survey of

regulations and policies pertaining to skills for green transition in 27 countries identied a number of

policy challenges, such as the lack of capacity to collect data on skills for green transition, the low level

of awareness of environmental sustainability and the weak institutional mechanisms for policy-making

and social dialogue that prevent skills development from playing a stronger role in the just transition.

With a view to contributing to effective formulation and implementation of skills development meas-

ures, this chapter conducts a global review and assessment of regulations, policies and programmes

implemented in 27 countries around the world, representing various levels of development and en-

vironmental challenges. It takes stock of the existing measures through country studies, updating the

information on the 21 countries

analysed in a study conducted by the ILO and the European Centre for

the Development of Vocational Training (Cedefop) in Skills for green jobs: A global view (Strietska-Ilina et

al., 2011), and adding information on six other countries

(see Appendix 4 for methodological details).

The chapter is organized in three sections. Section A analyses the integration of regulations and policies

pertaining to economic growth, environmental sustainability and skills development at the national,

local and sectoral levels since 2010. Section B then takes a closer look at individual programmes,

including the activities carried out to implement the regulations and policies introduced in section A,

as well as other ad hoc initiatives. Two types of programmes are discussed, namely skills needs iden-

tication and training provisions. Section C analyses institutional mechanisms that facilitate or hinder

regulatory and policy coherence and programme implementation. It also highlights successful factors

as well as obstacles. The chapter concludes by evaluating the current state of skills development meas-

ures against the objective of promoting a just transition, and offers policy recommendations.

1. The research on these 21 countries consists of 15 studies coordinated by the ILO (Australia, Bangladesh, Brazil, China, Costa

Rica, Egypt, India, Indonesia, the Republic of Korea, Mali, Philippines, South Africa, Thailand, Uganda and the United States)

and six coordinated by Cedefop (Denmark, Estonia, France, Germany, Spain and the United Kingdom). See Appendix 4 for

more details.

2. These six countries are Barbados, Guyana, Kyrgyzstan, Mauritius, Montenegro and Tajikistan.

5. Skills for the green transition 131

A. Skills development regulations and policies

As indicated in Chapter1, environmental sustainability is key for the world of work, just as–through

general economic activity and green jobs–the world of work is key for the achievement of environ-

mental sustainability. The transition to a low-carbon and resource-efcient economy requires environ-

mental policy, but also a change in modes of production that directly affect the world of work through

job creation, job destruction and occupational change. These changes lead to an important shift in

skills requirements across the economy, making skills policy a pivotal element for a successful transition

(Bowen, Duff and Frankhauser, 2016; Bowen and Kuralbayeva, 2015; ILO, 2012; Strietska-Ilina et al.,

2011). In order to inform policy discussions, this section illustrates the current state of skills develop-

ment regulations and policies at national, regional and sectoral levels, revealing patterns observed in

the countries surveyed.

There has been much progress at the national level in advancing environmental

sustainability, but progress in developing skills for the transformation lags behind

In comparison with 2010, more countries have formulated comprehensive environmental policies.

As in 2010, however, most of these policies in the countries surveyed make no explicit reference to

skills development at the national level. Barbados, China, Costa Rica and Kyrgyzstan are examples of

countries that commit to environmental sustainability, but without any mention of the skills development

required to achieve their goals. The same is true of Mali, Mauritius and Tajikistan.

In Barbados, for example, a strong partnership between the four main stakeholder groups is promoting

the transition to a green economy. These are government agencies (including ministries, the Barbados

TVET Council and national training institutions), private sector companies, international institutions and

NGOs. Despite the effective action for transition, Barbados lacks national skills development policies

targeting green jobs or skills development for a just transition, and institutions to translate the effect of

strong partnership to the skills training in workplaces. And yet, although there is no policy initiative at

the national level linking environmental sustainability and the corresponding skills development, this is

happening at the sectoral level (see the section on sectoral policies).

China has made considerable efforts to formulate environmental policy, strategies and regulations over

the past decade. However, skills development is largely absent from these efforts which focus mainly

on “capacity building” for adaptation, as shown in Chapter3, without an explicit reference to skills.

Costa Rica has adopted a vision of becoming the “Green Hub” of Central America, where decarbon-

ization is a strategy to strengthen national competitiveness. To that end, the National Apprenticeship

Institute (INA) undertook a series of skills needs assessments in environmental management, carbon

neutrality management, and environmentally friendly transport sectors.

Yet no specic skills policies or

strategies have been formulated to conduct assessments for other sectors relevant for the transition or

to adapt training provision based on the skills needs identied. Thus, the country is still in the process

of establishing skills policies and systems for green transition. A similar situation can be observed in

Kyrgyzstan, where the orientation towards sustainable development has led to the adoption of the

“Concept of Ecological Safety” and the “National Strategy for Sustainable Development 2013–2017”

(Djakupov et al., forthcoming), although the linkages between those strategies and skills development

programmes are limited. Similarly, the National Council for Job Skills Development, established in

2012, makes no reference to environmental sustainability or skills development for a just transition.

Lastly, in Tajikistan, a number of regulations, concepts and programmes have been adopted with a

view to achieving sustainable development focusing on rational uses of land, water and other natural

resources. Recent instruments include the “State Environmental Program of Republic of Tajikistan for

the period 2009–2019” and the Law of the Republic of Tajikistan “On Environmental Education of the

Population”. However, skills development for the occupations that are relevant to green transition is not

explicitly recognized as the priority in these instruments (Saidmurodov and Mahmud, forthcoming).

3. For example, the National Environmental Policy (NEP), 2013 in Bangladesh, which integrates environment issues in the devel-

opment agenda; the Bangladesh Water Act, 2013, which makes provision for the development and protection of water resources

(Mondal, forthcoming); the Law on Environmental protection, 2011 in Tajikistan, complemented by laws at sectoral level in forestry,

water, sheries, and radioactive waste management (UNECE, 2017); and the Climate Resilience Strategy and Action Plan (CRSAP),

2015 in Guyana, which identies climate resiliency actions across 15 sectors (Small and Witz, 2017).

4. For example, see Sánchez Calvo and Alfaro Trejos, 2014.

132 World Employment and Social Outlook 2018 – Greening with jobs

Despite slow progress overall, there are signs of policy coherence between

environmental sustainability and skills development in certain countries

In countries such as Denmark, Estonia, France and Germany, as well as in India, the Republic of

Korea, the Philippines and South Africa, a number of environmental policies and national development

strategies make reference to skills development for the green transition. Similarly, in some of these

countries, skills development strategies, Technical and Vocational Education and Training (TVET) pol-

icies and their implementing institutions are acknowledging the rising demand for skills required for

greening the economy.

Since 2010, the Philippines has adopted a number of regulations and policies at the national level for the

transition to a green economy, many of which explicitly recognize the role of skills development in the

transition (see, for example, the Green Jobs Act (GJA) of 2016, described in box5.1). The Philippines re-

cently adopted its Development Plan 2017–2022, which emphasizes the need for TVET programmes to

meet international standards and match skills demand through quality training provision and certication

(NEDA, 2017). The Development Plan will integrate green requirements into the curriculum and training

system as part of the implementation of the GJA. In addition, the National Green Jobs Human Resource

Development Plan is currently being developed, focusing on 12 key economic sectors: agriculture, con-

struction, forestry, sheries, renewable energy, manufacturing, transportation, solid and wastewater man-

agement, tourism, wholesale and retail trade, health and IT (Fernandez-Mendoza and Lazo, forthcoming).

In France, a number of environmental policies and complementary instruments have been introduced

since the adoption of the Grenelle Environment Roundtable commitments in 2007. The governments

(national and regional

), workers’ and employers’ representatives and NGOs have been participating in

the development and implementation of those polices and instruments, and facilitating the integration

of labour market and skills issues (Cedefop, forthcoming b). In 2010, a fully edged skills develop-

ment strategy was established, a mobilization plan for green jobs was launched, and the National

Observatory of Jobs and Skills in the Green Economy (Onemev) as well as regional observatories were

created in order to monitor employment trends. The observatories bring together various institutions to

5. France is divided into 18 administrative regions.

The Green Jobs Act (GJA) is the Philippines’

rst legislation designed to generate and

sustain green jobs. The Act contains

clauses promoting skills for green jobs

through initiatives such as identifying skills

needs, maintaining a database of green

careers, formulating training regulations,

skills assessment and certification, cur-

riculum development, and the implementa-

tion of skills training programmes and scal

incentives to encourage the provision of

training by enterprises. The Implementing

Rules and Regulations (IRR) of the GJA,

adopted in 2017, were based on extensive

consultation and the involvement of the tri-

partite constituents.

The Act mandates the Technical Education

and Skills Development Authority (TESDA)

and its Green Technology Center (GTC),

established in 2015, and the Professional

Regulation Commission (PRC) to develop

training regulations and a qualifications

framework, respectively. The Climate

Change Commission issues training certi-

cates, in collaboration with other bodies.

The GTC is a new training centre created in

2015 and offering training courses in skills

for green transition to cater for the needs for

emerging green jobs. It is responsible for de-

veloping and delivering quality green TVET

programmes; developing models of a green

working environment and workplaces; de-

veloping training regulations

for green sec-

tors; promoting green technology research

and adaptation through the establishment of

networks of institutions and researchers and

the hosting of green events, while serving

as a hub for entrepreneurs in green sectors.

The Centre provides TVET training in such

areas as photovoltaic systems, hydroponics,

vertical gardening, landscaping, inverter

technology and e-trike (an electric three-

wheeled vehicle) servicing (Usman, 2015).

Training regulations are TESDA-promulgated documents that dene the competency standards for a specic national

qualications and how such qualications can be gained, assessed and recognized. They serve as the basis for the de-

velopment of competency-based curricula, training materials and competency assessment tools. As of 2017, a total of

26 green training regulations have been developed (TESDA, 2011).

The Philippines Green Jobs Act of 2016

Box 5.1

5. Skills for the green transition 133

analyse occupations and employment shifts in the green economy, based on the denitions of green

occupations accepted by all the actors. Most key actors involved in skills identication include in their

activities a component on trends in jobs and skills related to the green economy. Skills curricula are

frequently renewed or adapted to take account of developments in the green economy. Many diplomas

and certicates now include awareness-raising on issues related to environmental sustainability, and

some have undergone more advanced and specic adaptation to the techniques, knowledge and skills

required by the ecological transition. The role of skills has been integrated into environmental regula-

tions such as the 2016 Act on reclaiming biodiversity, nature and landscapes, which includes support

for vocational training, research and education, as well as for innovation by SMEs.

India has made environmental sustainability a central objective of its development strategy in its twelfth

Five-Year Plan (2012–17) and set up a comprehensive framework for skills development for green transition

at the national level, targeting key sectors. Several institutions were created as a result, including the Skills

Council for Green Jobs in 2015, with the backing of the Ministry of New and Renewable Energy (MNRE)

and the Confederation of Indian Industry (CII). The objective of the Council is to identify skills needs in

the areas of renewable energy, energy efciency and waste and water management (see box 5.2). Based

on the identication of skills needs in these sectors, 26 new TVET courses have been developed for oc-

cupations ranging from water treatment plant helper to solar PV project manager and improved cooking

stove installer (NISTADS, forthcoming). Private institutions have also developed 70courses oriented

towards environmental sustainability (for example, in apparel and footwear manufacture and banking).

In the Republic of Korea, environmental regulations and policies have also to some extent taken into

consideration the importance of human resource development. This may have facilitated various

skills needs identication and anticipation surveys and expert consultations carried out by the gov-

ernment ministries in charge of environment, labour, trade and industry and energy. As a result, the

3rdEnvironmental Technology Manpower Development Plan (2013–2017) was established, with a

strong focus on highly skilled labour. In addition, new National Technical Qualications have been

developed in some specic green sectors with a view to supporting the national effort to meet the

environmental targets. However, the country still lacks a comprehensive skills development policy

specically targeted at strengthening TVET for the green transition, identifying skills needs, adapting

the training curriculum, creating teaching materials and developing incentives for private initiatives.

India has set itself the goal of generating

175 gigawatts of electricity from renewable

sources by 2022, which corresponds to

around half of its total electricity produc-

tion. The Council on Energy, Environment

and Water (CEEW) and the Natural

Resources Defence Council (NRDC) have

estimated the sectoral employment impact

of this change. Using surveys of solar and

wind companies, developers and manufac-

turers, the study nds that over 300,000

workers will be employed in the solar and

wind energy sectors to meet the 2022

target (CEEW, NRDC and SCGJ, 2017),

against 154,000 in 2009 (IRENA, 2011).

To meet the target, the number of workers

required by ground-mounted solar, rooftop

solar and wind power projects, will need

to increase. Table 5.1 shows the add-

itional jobs required for 2017–18, disag-

gregated by occupations. The potential

for employment creation is conditional on

the domestic capacity of solar module

manufacturing and the establishment of

vocational training programmes and certi-

cation schemes.

Nationwide survey of renewable energy jobs in India

Box 5.2

India: Estimated additional workforce required in solar and wind energy sectors, 2017–18

Occupations Sectors

Ground-mounted solar Rooftop solar Wind power Total

Business development 99 765 36 900

Design and pre-construction 395 4 4 2 5 66 4 8 8 6

Construction and commissioning 5 3 3 0 6 9 2 0 360 1 2 610

Operation and maintenance 3 8 3 5 250 3 000 7 0 8 5

Total number of jobs 9 6 5 9 12 3 6 0 3 4 6 2 2 5 4 81

Source: CEEW, NRDC and SCGJ, 2017.

Table 5.1

13 4 World Employment and Social Outlook 2018 – Greening with jobs

In South Africa, the central government and some national government departments have adopted

several policies and strategies relating to environmentally sustainable development. The 2011 National

Climate Change Response White Paper recognizes the role of the labour market in the green transition

and pays special attention to youth (DEA, 2011).

In Estonia, qualication standards have been updated for the existing occupations linked to the tran-

sition (e.g. energy auditors and steelworkers) or added to reect the emergence of new occupations

(e.g. biogas technology technician). This shows that the relevant skills are being integrated into the

country’s skills development system. However, the country lacks a comprehensive framework to de-

velop skills for the green transition (Cedefop, forthcoming c). In Denmark, new TVET programmes have

been developed to reect the demand for new skills, such as training for wind turbine operators in

2010 and environmental technologists in 2013 (Cedefop, forthcoming d). Finally, in Germany, skills for

the green transition are integrated into initial and continuous vocational training, under the “Education

for Sustainable Development (ESD)” framework. The national platform “Education for Sustainable

Development”, which brings together 37 representatives from politics, science, industry and civil

society, in 2017 adopted the national action plan called “Education for Sustainable Development”.

However, despite the efforts on mainstreaming environmental sustainability to the country’s education

system through the ESD, Germany has developed no specic strategies on skills for green transition

(Cedefop, forthcominge).

In countries which have curtailed progress towards environmental sustainability, the promotion of

skills for the transition has also slowed down. This is the case in Australia, Brazil and the United

States. However, in Australia and the United States, local governments and the private sector still rec-

ognize the value of environmental sustainability and the development of the respective skills policies

and programmes (Fairbrother et al., forthcoming; Garrett-Peltier, forthcoming; Rabe, 2002; Saha and

Muro, 2016).

Local government plays a key role in integrating skills and environmental policy

In countries such as China, France, the Republic of Korea, the United Kingdom and the United States,

local government integrates skills needs into policy formulation and implementation, due to its famili-

arity with the regional economy and labour market (for France and the United Kingdom, see Cedefop,

forthcoming a). Indeed, the local government’s autonomy and mandate for policy-making in the area

of skills development can be important in facilitating a just transition to a green economy.

In the United States, the State of California adopted a Clean Energy Jobs Act in 2013, covering a ve-

year period. Government agencies and training institutions were involved in its design and implemen-

tation.

The Act introduces a scal reform under which corporate income tax is channelled into the

California General Fund and the Clean Energy Job Creation Fund, generating up to US$ 550 million

annually (CEC, 2017), which has been invested in energy efciency and renewable energy. This invest-

ment could produce a signicant increase in demand for inputs from the renewable energy and energy

efciency sectors, which would in turn generate both direct and indirect jobs in the energy and con-

struction sectors (Zabin and Scott, 2013). To meet the demand for skills created by the Act, three- and

ve-year state-certied apprenticeship programmes have been implemented, largely self-funded by

employers and workers. In addition, pre-apprenticeship programmes have also been introduced so that

trainees without the required skills levels can also enter the apprenticeship programmes. For quality as-

surance of the pre-apprenticeship programmes, the Department of Labor has set the standards based

on which training and curricula are approved by the registered apprenticeship partners. In the Republic

of Korea, the Seoul Regional Council for Human Resource Development

has formulated and imple-

mented policies on the green transition and TVET which have resulted in new training programmes.

The United Kingdom takes a decentralized approach to skills development for the transition to a green

economy by shifting the decision-making power from the central government to the local governments.

This localized approach is adopted so that local governments work closely with businesses through

local bodies such as Local Economic Partnership in England, Scottish Enterprise and Invest Northern

Ireland, and skills development measures become more demand-led (Cedefop, forthcomingf).

6. To implement this Act, the California Energy Agency collaborates with the State Department of Education, the Community

Colleges Chancellor’s Ofce, the Conservation Corps, the Public Utilities Commission, the Workforce Development Board, the

Department of Industrial Relations and the Division of the State Architect in the Department of General Services.

7. The Seoul Regional Council for Human Resource Development is one of 16 regional councils in the country.

5. Skills for the green transition 135

Despite the positive roles played by local governments, decentralization can also give rise to regional

disparities and fragmentation if it is not accompanied by effective mechanisms for the integration of

local approaches into the national context. In China, for instance, local governments face difculties

in establishing a well-constructed skills development policy framework for a green transition due to

the lack of consensus on the denition of green jobs (IUES, forthcoming). Similarly, without a unied

national approach, the local governments in the United Kingdom have developed different approaches

to meet the standards set out by EU directives; as a result, different denitions and classications of

skills for transition are utilized in different sources and skills anticipation activities are structured in

different ways (Cedefop, forthcomingf).

Progress in skills policy formulation for the transition is more visible at the sectoral

level, particularly in energy, waste management and resource efciency

As highlighted in Chapter1, the energy sector is one of the major contributors to greenhouse gas (GHG)

emissions. Countries have adopted policies, strategies and regulations focusing directly on the energy

sector, many of which make specic reference to skills development. Yet, as shown in table 5.2, and

as further examined below, sectoral efforts are not restricted to the energy sector.

Barbados recently adopted its National Energy Policy 2017–2037, which recognizes the contribution

of skills to the development of the renewable energy sector. The policy outlines specic elements of

skills development such as qualication standards; curricula at various educational levels, with strong

emphasis on innovation; TVET programmes; information-sharing systems between educational insti-

tutions and the energy sector; and scholarship programmes related to energy in general, as well as to

sustainability in the oil and gas sector.

The United Kingdom has established the Energy and Utilities Skills Partnership (2017). This partnership is

a platform for developing sectoral strategies and skills assessment mechanisms in the renewable energy

sector, which is in turn expected to make the sector more attractive to workers (Cedefop, forthcoming f).

In addition to policies and strategies, regulatory instruments can also promote environmentally sus-

tainable behaviour on the part of rms and consumers, and contribute to mitigation efforts. Skills

development contributes to the implementation of regulations in the energy sector, since compliance

with energy regulations requires specialized skills and knowledge, as well as heightened awareness of

environmental sustainability. In fact, all of the 27 countries surveyed have adopted regulations on renew-

able energy or energy efciency, including rules on qualications, skills certication and/or the training

of professionals. These rules are often targeted at specic occupations, such as energy auditors, in-

spectors, assessors, energy managers, installers and operators of equipment and buildings. Some regu-

lations are more elaborate than others in their description of implementation mechanisms, including the

establishment of authorities (with dened functions and responsibilities), training institutions and funds.

For instance, Indonesia requires energy users that consume more than 6,000 tonnes of oil equiva-

lent a year to implement an energy management system. In accordance with this regulation, in 2010

the Ministry of Energy and Mineral Resources established the Mandatory Competency Standard for

Energy Manager in Industry. These developments have led to additional regulations on the Standard

Work Competence of Indonesia for energy managers and energy auditors, adopted by the Ministry of

Manpower and Transmigration. Against this backdrop, skills development and certication in the energy

sector have been promoted by two Professional Certication Institutes (Lembaga Sertikasi Profesi (LSP)).

Although the impact of skills development measures on energy use is difcult to quantify, there is

some evidence that when regulations are well targeted and their certication and training measures

are well implemented, countries tend to see an increase in the number of qualied professionals and

a reduction in energy use. For example, in Indonesia, one of the Professional Certication Institutes,

the Association of Energy Conservation Experts (Himpunan Ahli Konservasi Energi (HAKE)), has ad-

ministered an increasing number of competency tests for energy managers and auditors since 2012,

and had awarded certication to about 550 workers as of 2016 (gure 5.1).Likewise, in Australia, the

Building Energy Efciency Disclosure Act 2010 established the Commercial Building Disclosure (CBD)

programme and sets a legal requirement for the disclosure of information on energy efciency for

buildings of over 2,000 m

. The Act contains detailed rules on the training and accreditation of energy

assessors and establishes an auditing authority. In addition, training materials and online examinations

136 World Employment and Social Outlook 2018 – Greening with jobs

Priority sectors and occupations affected by the transition to a green economy

Country Sectors most relevant

for the green transition

New occupations identied/greening of old occupations (examples)

Bangladesh Energy, waste management,

construction (brick manufacturing),

transport, telecommunications

(introduction of eco-friendly cell

phones), agriculture, shery (shrimp)

and forestry

In brick manufacturing, chimney kiln operators

Barbados Renewable energy Electricians, electrical and mechanical engineers, solar PV designers, site

assessors, PV installers, energy auditors, energy conservation and efciency

specialists, plumbers, specialists in construction standards, trainers for project

managers, health and safety trainers

China Agriculture, manufacturing, energy,

building and construction, transport,

environmental protection and pollution

treatment, services

Wind turbine manufacture, equipment operators, renewable energy

management, research and training, engineering, power technology,

solar power generation, wind power generation, eco-design for buildings,

construction labourers, building retrotting workers, electricians, roofers,

building inspectors, E-vehicle manufacturer, high-rail construction workers,

metro and e-vehicle bus drivers, recycling and waste management, waste

management, coal washing and preparation, desulfurization and denitrication

equipment manufacture, research and training, energy conservation services,

nancial consultant

Costa Rica Agriculture, food, construction,

lithographic, wood, metalworking,

plastics, chemicals, textiles, services

Environmental engineers, food scientists and technologists, environmental

civil engineers, environmental designers and nanotechnologists, sustainability

specialists, electromechanical technicians, software developers, commercial

and industrial designers, industrial engineering technicians, agronomists,

biotechnologists, biologists, forest engineers, veterinarians

Egypt Renewable energy/solar and

wind energy, energy efciency,

waste management, agriculture,

manufacturing/leather

Solar installers, solar service technicians, solar plant managers, electricians

with solar expertise, plumbers, heating ventilation and air conditioning

technicians, wind turbine technicians, wind plant managers, quality engineers,

energy efciency managers, energy efciency auditors, plant managers for

cleaner production, cleaner production auditors, technicians, supervisors,

waste management specialists, organic farm auditors and certiers, pesticide

operators, machine operators (bio-fuel generators)

Estonia Agriculture, forestry, industry, waste

and the circular economy, construction,

renewable energy and maintenance,

technology development, geomatics,

transport, education sector, green

public procurement

Engineers, technicians, construction specialists, green architects and

designers, harvesters, forwarder operators, woodworkers, personnel dealing

with ozone-depleting substances, biology teachers and scientists

Guyana Biodiversity, agriculture, energy, water,

solid waste management, environmental

education, climate change education,

disaster risk management

New occupations identied in the energy sector and for the Guyana Energy

Agency

Indonesia Energy, construction Industrial energy auditors and managers, construction building energy

managers and auditors

Kyrgyzstan Agriculture, construction, mining,

metalworking, ecotourism

Agronomists, agricultural engineers, machine operators, estimating engineers,

welders, crane operators, mining engineers, shotrers, metalworkers, moulders,

steel-melters

Mauritius Renewable energy, tourism, private

sector/green business, public sector

Technicians, PV installers, energy auditors, eco-tourism operators, eco-guides,

eco-entrepreneurs, green public ofcers

Montenegro Tourism, agriculture and energy sectors Production and installation of energy-efcient windows and doors, organic

production, mountain guides

Philippines Public sector/green procurement,

solid waste management and garbage

collection, renewable energy, tourism

Green procurement managers, operators of sanitary landlls, project engineers,

environmental and social safeguard focal persons, renewable energy experts,

hydrologists, wind, solar and biomass experts, biologists, chemists and disposal

ofcers, solar PV tters, aerospace technicians, wind-turbine technicians,

offshore oil/wind maintenance technicians

Spain Forestry, waste, services, energy Forest and environmental agents, qualied workers in hunting activities, forest

re workers, qualied workers in forestry and natural environmental activities,

prevention of labour and environment risk agents, waste classication workers,

environmental and forest technicians, vehicle cleaners, sweepers, power plant

technicians, electricity technicians

Tajikistan Renewable energy/ hydro, agriculture,

ecotourism,

construction

Organic farmers, managers, energy auditors, engineers, operational and

maintenance specialists in hydro, solar and biomass energy, solar panel

installers; tour operators, eco-guides

Thailand Energy Carbon-related project analysts, green marker ofcers, public relations ofcers,

green engineers, green architects

Uganda Agriculture, industry, energy,

cities/transport

Production and processing of organic products, soil fertility management,

weeding and post-harvest handling

Source: ILO compilation based on country studies.

Table 5.2

5. Skills for the green transition 137

have been developed and utilized. An impact assessment concluded that the regulation was effective

in reducing energy consumption and GHG emissions and generating economic benets between 2010

and 2014 (ACIL Allen Consulting, 2015). Renewable energy and energy efciency regulations therefore

show how environmental sustainability and skills development can be integrated. Policy-makers are en-

couraged to consider a similar approach in other sectors, such as agriculture and waste management.

In Egypt, the Waste Management Regulatory Authority (WMRA) was established in 2015, with the

responsibility to identify environmental challenges and enforce laws in all governorates and munici-

palities. As such, the WMRA provides training in waste management, hazardous waste management,

hazardous waste compliance, the handling and disposal of waste, the operation of waste facilities,

waste to energy conversion, chemical waste management, waste management regulation, waste man-

agement in health care and the tracking and transport of waste (Amin, forthcoming). Set up in 2005,

the Egypt National Cleaner Production Centre (ENCPC) coordinates and promotes cleaner produc-

tion, waste management, innovation and energy efciency issues for Egyptian industry. As part of

its capacity-building activities, the ENCPC provides training in waste tyre management and recycling

and is developing an accredited capacity-building programme to train energy managers in energy ef-

ciency. Two other providers, the Regional Center for Renewable Energy and Efciency (RCREEE) and

the Industrial Modernization Centre (IMC) also offer professional certication programmes for energy

experts and managers.

Although the sectoral approach has many benets, including the relative ease of stakeholder coord-

ination and the identication of specic skills needs (Strietska-Ilina, 2017), it is not sufcient for en-

suring comprehensive skills development for green transition (Cedefop, 2015;

Strietska-Ilina et al., 2011;

OECD, 2014). From an economy-wide perspective, not only priority sectors, but all sectors have the

potential for greening (ILO, 2013). Such a perspective allows stakeholders to identify skills needs arising

out of both direct and indirect job creation along supply chains, and in turn to design and implement

training programmes for a wide range of sectors and jobs at all skill levels.

In practice, the implementation of an economy-wide approach is more challenging than a sectoral ap-

proach. Cross-sectoral coordination is often seen by stakeholders as being “too costly”, as it often gives

rise to conicting and overlapping priorities (Watson, Brickell and McFarland, 2013).

Because of these

difculties, there are few examples of good practices. As a result, policy-makers and other actors have

not yet developed a good understanding of what is required for successful cross-sectoral coordination.

Despite the difculties, some countries (such as Denmark and France) provide good examples (Cedefop,

forthcoming a). These countries are characterized by several common factors, including: (1)a high level

8. On the other hand, some argue that cross-sectoral coordination would lead to a reduction in transaction and implementation

costs compared to the cost of separate sectoral initiatives (ibid.).

140

210

280

350

2012 2013 2014 2015 2016 Total

Industrial energy manager

Construction bulding energy manager

Industrial energy audit

Construction bulding energy audit

Indonesia: Number of graduates certied as energy managers and energy auditors, 2012–16

Figure 5.1

Source: LSP HAKE, 2017.

138 World Employment and Social Outlook 2018 – Greening with jobs

of public acceptance of environmental sustainability; (2)provision for skills development for the green

transition in policies at the national level; and (3)the existence of institutional mechanisms for cross-sec-

toral coordination on skills for green transition. The high level of public acceptance of environmental

sustainability issues may have facilitated cross-sectoral coordination and consensus building with an

economy-wide perspective. Thus, raising awareness of environmental issues is a powerful tool for the

development of skills for the greening of the economy as a whole, and not only in priority sectors. One

policy tool to increase environmental awareness is to incorporate “core skills”

into education systems at

all levels (Strietska-Ilina et al., 2011). Core skills are non-vocational and non-technical competencies that

are needed to perform at work and in society (Gregg, Strietska-Ilina and Büdke, 2015) and which, in the

context of green transition, include “environmental awareness and willingness to learn about sustainable

development” (Strietska-Ilina et al., 2011, p. 107). Core skills can facilitate shifts in consumer behaviour

towards environmentally sustainable goods and services. They can also improve the employability of

workers across multiple sectors or occupations, thus contributing to the resilience of workers in the face

of possible job displacement and income losses during the transition to a green economy.

Supranational or regional initiatives can bring about economies of scale

Establishing regional policies on skills certication and training provision may increase investors’ con-

dence in the regions’ skills base. In addition, regional agreements on the recognition of qualication

help ensure that migrant workers with certied skills can contribute to a green economy in the region

whether they are in home or destination countries. Since 2010, there has been an increase in policies

on environmental issues and skills development at the supranational/regional level. For example, the

ASEAN Green Hotel Standard, adopted in 2016, establishes the qualication and experience require-

ments for green hotel inspectors. In Africa, the Economic Community of West African States (ECOWAS)

adopted regional Energy Efciency Policy and Renewable Energy Policy in 2013, with strong emphasis

on developing a harmonized framework for qualication standards and skills certication.

Policy coherence is emerging, but more needs to be done

In summary, this section has shown that the regulatory and policy coherence between skills devel-

opment and environmental sustainability is certainly emerging in some countries, but the majority of

the sample countries are still at the initial stage of their efforts to achieve such coherence. In many

countries, environmental law reforms introduced since 2010, especially in the areas of energy, building

and construction and waste management, have led to the establishment or revision of professional

qualication standards. This has, in turn, led to changes in certication systems. Both public and pri-

vate institutions have responded to these policy changes by developing training curricula and carrying

out skills assessment tests. Regulatory instruments have been a major driver in setting, formulating

and implementing skills policies, although it may be difcult to adapt them to changing skills needs.

There are some issues that warrant the attention of policy-makers. First, spatial challenges may arise if

green economy jobs are created in locations other than those that suffer the bulk of job losses. Education

and training efforts therefore need to be linked with economic development strategies and just transition

policies. In the United States, employment in coal (with the potential for job loss) and most employment

in solar and wind power are located in different states. China, the world’s largest coal producer, expects

to lay off 1.8 million coal and steel workers (15per cent of the workforce) in the coming years. Efforts

to strengthen skills training for the workers affected will be part of the measures taken by central and

local governments to smooth the transition (IUES, forthcoming). In this regard, granular assessments of

skills and competences at the company, community and sub-provincial levels may provide useful tools

for facilitating equitable structural transformation in China (see, for example, Caldecott et al., 2017).

Second, in smaller countries, the limited size of the market may be insufcient to develop traditional

forms of specialized training. In Montenegro, for example, skills development for the green transition

to promote ecotourism (e.g. mountain guides) might be difcult to organize, at least given the current

size of the market for ecotourism (Djuric, forthcoming). Another deterrent, for example in Guyana, is

the emigration of skilled labour.

9. See Gregg, Strietska-Ilina and Büdke (2015) for the denition, and ILO (2011) for specic examples of core skills in the context

of green transition.

5. Skills for the green transition 139

Lastly, when environmental sustainability is not deeply rooted in the national growth strategy, policy

debate can be shifted away from long-term issues in the face of economic downturn and weak labour

market performance. The de-prioritization of environmental sustainability in national growth strategies

has had a concrete impact at the policy level, in some cases leading to the relaxation of restrictions set

out in or enforcement of environmental laws or a signicant reduction in the public funding allocated

for climate change policies. Even when national policy supports environmental sustainability and the

transition to a green economy, the importance of skills tends to be overlooked, signalling insufcient

levels of awareness among stakeholders regarding the role of skills in this respect.

B. Skills development programmes and initiatives

for greening the economy

Following the examination of regulatory and policy coherence in Section A, this section takes a closer

look at the micro level and analyses the details of implementing programmes in the areas of skills needs

identication and training provisions. In so doing, it highlights overall trends in programme implementa-

tion in terms of the actors involved as well as administrative levels, sectors and types of target audience.

Identifying skills needs is a key rst step in meeting labour market needs

The assessment of skills needs can be both quantitative and qualitative. The green transition comes

along with the changes in the number of workers in different occupations (hence the need for quan-

titative assessment), as well as the changes in the skills required for a particular occupation without

changing the number of jobs (hence the need for qualitative assessment) (Gregg, Strietska-Ilina and

Büdke, 2015). The 27 country studies conducted for this chapter show that the latter is more common.

This can be due to various reasons, such as qualitative shifts in skills needs (e.g. greening existing

occupations) being deemed more relevant, or quantitative data not being available.

Since 2010, many countries have continued their efforts to identify the skills needed for the green

transition at the national, local and sectoral levels. These efforts are often embedded in broad econ-

omy-wide efforts, but in recent years various ad hoc initiatives have responded to the increasing and

specic needs of the transition to a green economy (for example, in Costa Rica, Thailand and the

United Kingdom). Ad hoc initiatives are also common in countries with limited nancial resources and

know-how to carry out structural reforms of their skills development measures (for example, a survey

conducted in Barbados by Sault College and Samuel Jackman Prescod Polytechnic in 2014).

Several countries have established regular systems for the identication and anticipation of skills needs

throughout the economy (OECD, 2016; Strietska-Ilina et al., 2011). For instance, a list of occupations in

high demand, including occupations related to green sectors, is published regularly in South Africa. In

France, the National Observatory of Jobs and Skills in the Green Economy (Onemev) conducts regular

assessments on the employment trends in green economy and publishes the results in activity reports

and other publications (Cedefop, forthcoming b). Finally, Thailand’s Occupational Trends report, regu-

larly published by the Department of Employment (DOE) under the Ministry of Labour, also identies

the demand for occupations, including those related to green sectors.

Skills identication efforts are also emerging at the local/regional

and sectoral levels, with a growing role for employers

In Thailand, the Climate Change Technology Needs Assessment estimates skills needs in some priority

sectors (i.e. agriculture, modelling, and water resource management) (Bhula-or, forthcoming; STI and

URC, 2012). In addition, the demand for labour is often identied in private companies by human

resources or business strategy divisions. The employers’ organization participates by organizing meet-

ings and drawing up a list of training courses based on the needs identied by private companies. The

needs identied and the list of training courses are then communicated to government bodies, such

as the Department of Skills Development (DSD).

140 World Employment and Social Outlook 2018 – Greening with jobs

In Costa Rica, the Chamber of Industry has carried out a study covering 100 of its 800 members to

identify their skills needs for the green transition (INCAE Business School, forthcoming). In the United

Kingdom, employers’ organizations play an increasingly important part in the skills needs assessment

conducted by the Sector Skills Councils (Cedefop, forthcoming f). In the United States, despite the roll-

backs at the federal level, there are environmental rules and regulations at state level, and some state

governments are active in identifying skills needs for the green transition. One example is MassCEC’s

annual Massachusetts Clean Energy Industry Report, which contains information on skills needs in

the clean energy sector.

The inclusion of skills for green transition into the formal vocational

training system is still in its early stages in many countries

In the majority of countries analysed in this report, skills for green transition are not yet part of the

TVET curriculum. This is often due to the disconnect between TVET systems, environmental policies

and national development strategies, as well as between TVET institutions and industry. In many cases

training for the green transition is provided by employers, mainly because they are directly exposed

to changing skills needs, and partly because of the insufcient development of such training through

formal TVET systems. By lling this gap, the private sector is playing a key role in providing opportun-

ities for work-based learning, such as apprenticeships, and in creating closer links between training

institutions and companies. Communication between the private sector and the formal TVET system

is crucial in helping the latter to adapt to skills needs in the longer term.

When skills for green transition are incorporated into the formal education system, the programmes are

often provided at the level of post-secondary education, and include associate degrees at community

colleges and Bachelors, Masters, PhD and postgraduate degrees at universities.

The Republic of Korea has seen many developments in the greening of its vocational education and

training system since 2009. National Competency Standards (NCS) in skills for green transition have

been determined for jobs in the environmental energy, transport and machinery sectors in collaboration

with industry experts and with nancial support under the National Strategy for Green Growth (2009–

2050). The New National Technical Qualication in skills for green transition has been established,

as well as many courses and programmes at TVET institutions and university departments. Within

the framework of the National Strategy for Green Growth, the Government has invested in research

and development in green technologies. In addition, vocational colleges, such as poly-tech colleges,

now offer associate degree programmes and non-degree vocational training courses, allowing mid-

career professionals to improve their skills without completing full degree programmes. The Ministry

of Employment and Labour (MOEL), which oversees TVET institutions, has supported curriculum and

textbook development based on the NCS. And TVET institutions, such as poly-tech colleges, have

actively implemented dual work–learning programmes, which allow workers to receive work-related

training, for example on environment and energy, at their workplace or in regional training centres.

Thailand offers another example of good practice in skills development through formal education. In

2011, the Thailand Professional Qualication Institute (TPQI), a public institution, was set up to develop

skills and occupational standards. This has led to extensive coverage of skills standards, including skills

for the green transition. TPQI’s skills and occupational standards are developed to reect the skills

needs expressed by the private sector, and are in line with national strategies for the promotion of the

digital sector (i.e. Thailand 4.0) and an environmentally friendly economy.

Public institutions afliated with ministries

usually provide both initial and continuous training

Government agencies, often in accordance with sector-specic mandates, carry out the provision of

both initial and continuous training. In the Republic of Korea, the Ministry of Environment and the

Ministry of Land, Transportation and Construction provide training directly through their training insti-

tutions for professionals and new entrants to the labour market (Jin, forthcoming).

In South Africa, the National Cleaner Production Centre of South Africa (NCPC-SA) offers a six-month

internship programme to strengthen the employability of young engineers by providing them with

training and experience in greener production in various sectors: clothing, textiles, footwear and

5. Skills for the green transition 141

leather; chemicals, plastics, cosmetics, pharmaceuticals; automotive; and agro-processing. The com-

bination of training, mentoring and workplace experience is effective in promoting the employability

of trainees, suggested by the employment rate of interns at 83per cent between 2010 and 2013

(OneWorld Sustainable Investments, forthcoming). In 2010, the NCPC-SA launched the Industrial

Energy Efciency Improvement Project (IEE project), which offers training courses in energy man-

agement systems and energy systems optimization. The IEE project is implemented through collab-

oration between the Department of Trade and Industry, the Department of Energy, the Department of

Environmental Affairs, Business Unity South Africa (BUSA) and international cooperation with UNIDO

and Switzerland’s State Secretariat for Economic Affairs (SECO).

Private training institutions also play an important role…

With a view to improving its quality through market competition, some training is provided by private

training institutions. A number of these institutions are funded by the government, with training being

outsourced, while others are totally privately funded. However, some country studies refer to concerns

regarding the quality of training delivered by private TVET providers when the training is publicly

funded. For example, in Australia, where publicly funded TVET has been contracted out to private

colleges, the Skills Quality Authority has identied some weaknesses in endeavouring to ensure high-

quality training based on competition between private providers. This is due, rst, to the inadequate

specication of standards relating to the volume, duration and quality of training. Second, there is infor-

mation asymmetry between training providers and students, who are often unaware of the real quality

of training. Third, market forces can potentially induce private training institutions to invest in factors

other than the quality of training, such as enhanced brand image through advertising.

… as do local government initiatives

As noted above, local governments play a major role in designing and implementing the provision of

training, largely due to their familiarity with local economies and labour markets. Local skills develop-

ment programmes can be quite extensive, but without coordination at the national level, they may give

rise to regional disparities and inefciency.

In the Republic of Korea, the local government of the city of Seoul, in collaboration with the Northern

Technical Training Centre, which is part of the Ministry of Employment and Labour, provides training

courses in renewable energy and green car maintenance. The training is provided free of charge,

together with job placement and counselling services. However, Seoul’s initiative is fairly exceptional

and is related to the fact that the city accounts for at least half of the economic activity, jobs and popu-

lation of the Republic of Korea, and that it has much greater nancial capacity than the other 16local

governments in the country (Jin, forthcoming).

Employer-led initiatives can also give rise to training opportunities…

Employers also design and provide training, especially short training programmes. These can be more

timely and responsive to changes in the labour market. In Thailand, for example, private companies

play an important role through public–private partnerships, not only in identifying and anticipating skills

needs, but also in providing training for the green transition. The employers’ organization sometimes

organizes paid training seminars on topics such as energy saving and environmental awareness, which

are open to members and non-members alike. When instructors are not readily identiable in the

country, they are invited from abroad.

Financial incentives can expand the scope of training provided by employers. Since 2010, an increasing

number of employees have received training on skills for green transition supported by such incentives.

In Spain, for instance, employers who offer training benet from reductions in social security contribu-

tions. Between 2009 and 2016, the number of employees who received training for the green transition

under this system doubled from 30,382 to 61,984 (Cedefop, forthcoming g). SMEs tend to face greater

barriers in accessing the system, due to their lack of necessary knowledge, theadministrative burden

involved and their lack of trust in the system. In order to lower these barriers, the State Foundation for

Training for Employment (Fundae) and the Spanish Confederation of Employers’ Organizations (CEOE)

organize guidance workshops and provide other assistance to SMEs.

14 2 World Employment and Social Outlook 2018 – Greening with jobs

The provision of TVET can also respond to direct demand from the private sector, for instance once

a substantial number of companies are operating in the green economy or have created a “green

cluster” in a region. In Spain, enterprises manufacturing electric cars in Castilla y León, a region with

an automotive industry cluster, were able to persuade the regional government to invest in 2009 in a

higher automotive technician diploma (Cedefop, forthcoming g).

Collaboration between a government agency and a specic enterprise can also lead to the provision

of TVET. In Thailand, for example, the Department of Skills Development (DSD) started cooperating in

August 2017 with a private company, DAIKIN, and the German Agency for International Cooperation

(GIZ) to develop skills standards and competencies for air-conditioning technicians working on refrig-

erators using natural refrigerants. The collaboration will result in courses, curricula, assessment tools

and training equipment at DSD training centres (Bhula-or, forthcoming).

In Bangladesh, a waste management company produces organic fertilizer using fruit and vegetable

waste from the markets of Dhaka. Composting all the organic waste in Dhaka could create new jobs for

16,000 people from lower socio-economic backgrounds. The company has set up a Regional Recycling

Training Center, in collaboration with the municipal government (Mondal, forthcoming).

In Brazil, the sugar cane sector employs a relatively large number of workers, with half the produc-

tion being concentrated in the State of São Paulo. However, most of the jobs are damaging to the

environment, as pre-burning causes serious atmospheric pollution. Mechanization avoids pre-burning

and provides better working conditions, but for a smaller number of workers. In accordance with the

Agro-Environmental Protocol of the Sugar and Energy Sector to end burning in sugar cane plantations,

signed by the Secretariats of the Environment and Agriculture of São Paulo and the Union of the Sugar

Cane Industry (UNICA), there was a 41per cent drop in the workforce employed in the sugar energy

sector between 2007 and 2014 (UNICA and FERAESP, 2015).

An important training initiative for displaced sugar cane cutters was introduced in 2009. Known as

Projeto RenovAção (“Project RenovAction”), it is based on an agreement between UNICA, the National

Industrial Training Service of São Paulo (SENAI) and several other educational institutions and part-

ners. Training is provided for workers in new occupations in the sugar energy sector itself, and various

courses are also offered to develop skills required in other sectors. Through the RenovAção project,

workers can dedicate themselves to the courses, receiving monthly wages and other benets (such

as social contributions), as if they were working. The training initially targeted a quota of 20per cent

women participants, and was based on social dialogue. There is a specic teaching module for illit-

erate and semi-literate workers (the “Pre-RenovAção”), leading to a qualication consisting of basic

subjects (reading, writing, mathematics, general knowledge, citizenship), which enables the workers

to subsequently take part in Projeto RenovAção training courses. Most of the courses entail over

300hours of training, with a total of 6,650 workers receiving training between 2010 and 2015 (ibid.;

Young etal., forthcoming).

There are many examples of enterprises cooperating with universities and training centres for the de-

velopment of curricula to address specic skills gaps, such as training for the installation of photovoltaic

cells and the installation and use of solar water heaters in Barbados (University of the West Indies,

forthcoming) and skills in the cement industry in Indonesia (IBCSD, forthcoming).

Finally, capacity building based on networks of enterprises and the principles of the circular economy

can enhance resource productivity and the environmental performance of SMEs, as in the case of

Mauritius (Sultan, forthcoming).

… and workers’ organizations are increasingly involved

There are examples of workers’ organizations involved in training for the green transition, such as

Green Masonry Training in the Philippines in 2012, which was the result of collaboration between the

Association of Construction and Informal Workers and the National Union of Building and Construction

Workers and other partners (Fernandez-Mendoza and Lazo, forthcoming). Similarly, in the United

Kingdom, trade unions have increased their involvement in skills development for green transition

through an organization called Unionlearn. The University and College Union (UCU) has established

“Greener Jobs Alliance” in order to step up trade union activities in localities and regions with the aim

of inuencing school curriculum (Cedefop, forthcoming f).

5. Skills for the green transition 143

Training programmes often focus on specic sectors

Energy

In the United States, the Department of Energy (DOE) plays an active role in providing skills training for

the energy sector, both at the national and local government levels. Over recent years, it has proposed

22 workforce training programmes through its Ofce of Energy Efciency and Renewable Energy

(DOE EERE), targeting a wide audience including professionals, students, entrepreneurs, industry

stakeholders, jobseekers and the general public.

In Mali, the Ministry of Energy and Water promotes renewable energy loans to facilitate access to

credit by consumers interested in installing solar equipment. To advance this programme, the Agency

for Renewable Energy in Mali (AER-Mali) and the Support Fund for Vocational Training and Learning

(FAFPA) are currently working together to develop training modules for bank sales managers.

In Egypt, with a view to harnessing solar power, an NGO called Solar Energy Development Association

(SEDA) offers several short-term intensive training courses for professionals on such topics as photovol-

taic grid connected (on-grid) systems, solar water pumping and comprehensive photovoltaic systems.

In developing countries there is a large potential to increase energy efciency in household consump-

tion. About half the world’s population use solid fuels, such as wood and coal, to meet their cooking

needs (UNDP and WHO, 2009). As in the case of Uganda (box5.3), access to training in the use of

more efcient stoves can improve energy efciency and contribute to local development.

In Uganda, open re is the major cooking

method used by 94per cent of rural house-

holds, while charcoal stoves are common in

urban areas (MEMD, 2016). The use of in-

efcient cooking methods is a contributing

factor to poverty, as low-income families

spend up to 15per cent of their income on

charcoal or wood, and the search for wood

can take up to six hours a day, which could

have been used to earn income through

paid work. However, about 10per cent of

the population uses improved charcoal or

wood stoves, which reduce fuel consump-

tion by an average of 36 and 58per cent,

respectively (Kabasa et al., forthcoming).

In rural areas, many local stove projects

use resident artisans to manufacture stoves

adapted to local needs and train them in

specialized ceramic skills so that they can

enhance the functionality of the stoves.

Training of artisans in the production of im-

proved stoves is usually organized by the pri-

vate sector with informal curricula, which are

not approved by the Directorate of Industrial

Training (DIT). Fees range between 200,000

(US$ 55) and 500,000 (US$ 140) Uganda

shillings for four weeks. This training could

be mainstreamed in the vocational training

system at a later stage if the curriculum is

approved by the DIT. “Energising Uganda”

has trained more than 500 rural artisans

since 2014 to produce and sell rural re-

wood stoves. Other support is provided to

the artisans to ensure the sustainable growth

of supply. User training, which is usually

offered free-of-charge by the enterprises

that sell the stoves, is key to the successful

adoption of more efcient cooking methods.

The production of improved cooking stoves

is an income-generating activity which could

also have indirect employment effects. To

maximize the benefits, the certification

of training and the development of quality

production is important. For example, the

acquisition by small enterprises of produc-

tion and distribution franchises from large

producers can help to improve quality, repu-

tation and consumer satisfaction. Keeping

the cost of improved stoves affordable is still

a challenge, and skills development could

help to make the product more competitive.

Training provided in trade fairs and during

the Energy Efciency Week could be scaled

up and could inform consumers of the

health benets that improved cooking de-

vices bring by mitigating indoor air pollution.

Source: Based on Kabasa et al., forthcoming.

Training in the use of improved cooking stoves in Uganda

Box 5.3

144 World Employment and Social Outlook 2018 – Greening with jobs

Agriculture

Skills programmes in the agricultural sector are generally oriented towards food production efciency

rather than promoting the adoption of environmentally sustainable production systems. Weak coord-

ination, the failure to identify skills needs, the sluggish involvement of the social partners and poor

working conditions are all key challenges to overcome if agriculture is to go green.

In Mauritius, since 2016 over 3,200 farmers have beneted from the Compost Subsidy Scheme and

the Sheltered Farming Scheme to shift from using chemicals to organic inputs (Sultan, forthcoming).

The Food and Agriculture Research Extension Institute (FAREI) provides training for farmers, par-

ticularly in horticulture, agro-processing and agri-business. Participants can obtain MauriGAP certi-

cation in bio-farming. In addition, the FAREI Farming Training School offers bio-farming courses in

collaboration with the Mauritius Institute of Technical Development (MITD). MITD provides a rainwater

harvesting course in techniques for the reuse of plastic containers. Occupational safety and health

components are integrated into all the training provided by MITD (ibid.).

In Mali, agriculture–and particularly cotton and food production–is a major sector for socio-economic

development. It is also the sector most vulnerable to climate change, including erratic weather and water

supply (Nyetaa, forthcoming). Firms exporting agricultural products need to have specic skills, such

as knowledge of certication rules and international trade standards, organic farming, composting and

food standards. Farmers producing for the domestic market lack training in sustainable agriculture,

although some progress has been made. For example, a ve-year project in the cotton-growing regions

of southern Mali, which includes awareness-raising and training on key sustainability issues, has been

able to reduce the use of chemical pesticides by 90per cent (IFC et al., 2015).

Uganda has the largest farm area under organic management in all of Africa, with employment

estimates ranging from 200,000 to 400,000 farmers. The National Organic Agriculture Movement

(NOGAMU) is an NGO which brings together training institutions, national and international agencies

and the private sector to support the development of organic farming in the country. NOGAMU has

identied skills needs in the production and processing of organic products, and training needs for

farmers interested in sustainable pest and disease management, soil fertility management, weeding

and post-harvest handling. NOGAMU offers a range of training services in collaboration with education

and training institutions, such as the College of Veterinary Medicine of Makerere University and the

Uganda Martyrs University.

In other countries too there are many examples of training for organic agriculture or small-scale

farming through non-formal courses and training programmes implemented on a project basis (e.g.

Bangladesh, Egypt, Mali) or through formal training (e.g. Barbados, Costa Rica, Kyrgyzstan). Guyana

offers and supports climate-resilient agricultural techniques in hydroponic production.

Forestry

The Guyana Mangrove Restoration Project (2010–13) aimed to create employment and support skills

development to increase carbon sequestration, strengthen coastal resiliency and reduce the risk of

oods (Small and Witz, 2017). Skills were provided for the planning, harvesting and maintenance of

mangroves, as well as creating awareness of the role of mangroves in protecting the environment

and enterprise development. A few enterprises were created in agro-processing and ecotourism. The

project, which created 1,000 jobs, adopted an innovative approach to the sustainability of mangrove

forest improvement. In exchange for enterprise development services, participants were requested to

actively monitor the restoration and use of the mangrove forest in collaboration with local and regional

institutions and the Ministry of Agriculture. In 2014, the project unit was integrated into the Ministry of

Agriculture, which should facilitate the extension of the project across Guyana’s mangrove forests and

its application to other sectors, such as forestry.

Ecotourism

The Philippines Department of Environment and Natural Resources (DENR) has recognized ecotourism

in designated areas and provided guidelines for ecotourism planning and management. In 2013, a

gender-responsive toolkit on ecotourism planning and management was developed by the Philippines

Commission on Women in partnership with the DENR. The toolkit contains training sessions on ecot-

ourism planning, trail resources and monitoring for protected area ofcers and ecotourism guides, and

marine resources monitoring for ecotourism (GREAT and PAWB, 2013).

5. Skills for the green transition 145

Waste management

Efforts to develop the skills of workers in waste management have also been made in a large number

of developed and developing countries with a view to reducing the amount of landll and increasing

recycling (box5.4).

Programmes organized by target group

Adult workers

Adult training for the greening of occupations and retraining of displaced workers can take the form

of short courses. In Denmark, for example, a four-day course on environmental care is provided

for property caretakers (Cedefop, forthcoming d). In many developing and emerging countries (e.g.

Bangladesh, India and Uganda), on the other hand, adult training is less common. This may be due to

the fact that in lower-income countries lower-skilled occupations make up a large share of employment,

and skills may be considered as being relatively more transferable among those occupations even

without training. For example, in Uganda, no training was provided when motorcycle taxis (bodaboda)

were replaced by the city bus service, and many of the workers who lost their jobs have become touts

and conductors to direct passengers to the buses.

The waste management and recycling

sector employs over 500,000 people in

Brazil (CEMPRE, 2010; ILO, 2011), 62,147

in South Africa (DEA, 2012; OneWorld

Sustainable Investments, forthcoming) and

some 400,000 to 500,000 in Bangladesh

(Mondal, forthcoming). Most of these

workers are in the informal economy, pri-

marily in urban areas, and often play an

important role in increasing the level of

recycling, while reducing the amount of

landll. However, they face serious decent

work decits, such as work-related hazards,

low earnings and long working hours; they

are often not legally registered (hence the

exclusion from labour legislation and social

protection) and are socially stigmatized

(ILO and WIEGO, 2017; Schenck, Blaauw

and Viljoen, 2012). In response to these

challenges, cooperatives and other social

and solidarity economy organizations have

been set up in countries such as Brazil,

Colombia, India and South Africa to in-

crease the recognition and collective voice

of waste pickers (ILO, 2014). According to

Green Fund (2016), scaling up the potential

of waste management and recycling to in-

tegrate low-skilled informal workers into the

formal economy, while at the same time pro-

moting an economy with fewer waste is key

to improving working conditions in the waste

sector and the environment in South Africa.

However, the important question remains

regarding the role of skills development in

ensuring the transition of informal waste

pickers to formal employment and to better

working conditions. The development of

the circular economy (recycling products,

giving a new life to old products) involves

the need for sorting, which requires a good

knowledge of waste issues, suggesting the

need to extend training to workers in the

informal waste management sector.

There are some initiatives that address

this skills gap. In France, the Professional

Federation of Recycling Companies

(FEDEREC) brings together 1,300 com-

panies in the sector. The branch beneted

from public co-nancing to make a pro-

spective inventory of its needs and skills,

which led to the creation and implemen-

tation of five new qualifications: manual

sorting operator, mechanized sorting op-

erator, industrial team leader, industrial

equipment operator, and industrial main-

tenance operator (Cedefop, forthcoming

b). In Bangladesh, a private company,

Waste Concern, has developed two training

modules for community-based solid waste

management and resource recovery

(Mondal, forthcoming). Similarly, ILO and

WIEGO nd that waste picker cooperatives

covered by their recent study

provide or

facilitate access to training in the areas of

legal recognition and technical skills related

to waste management, while training in the

area of OSH is largely overlooked (ILO and

WIEGO, 2017).

A total of 29 cooperatives from Argentina, Brazil, Colombia, India, South Africa and Turkey were surveyed. See ILO and

WIEGO (2017) for details on the research design.

Skills for green transition in waste management and recycling: The potential for decent work?

Box 5.4

146 World Employment and Social Outlook 2018 – Greening with jobs

Persons with disabilities

By focusing on training for persons with disabilities in developing skills for the green economy, it is pos-

sible to contribute to reducing inequality in access to education and employment. In Indonesia, nearly

half of persons with disabilities have not completed primary education, and their employment share in

urban areas is low (ILO, 2017a). Evidence from other countries suggests that such programmes can

generate positive outcomes at the village level or in coastal areas in countries with a high level of outward

migration. In Bangladesh, for instance, 200 persons with disabilities (mainly women) were trained in or-

ganic mushroom production and marketing in partnership with eight mushroom cooperatives (Mondal,

forthcoming). The key success factor was the creation of partnerships between skills councils and the

private sector in targeted sectors, with a commitment to a 5per cent admission quota for persons with

disabilities in TVET institutions. In Guyana, a project launched in 2014 provided training in hydroponic

agriculture to almost 100 deaf students, 12 teachers and some parents (Small and Witz, 2017).

Indigenous and tribal peoples

Although indigenous people are vulnerable to climate change, they can play an essential role in sus-

tainable policies and programmes as change agents for addressing environmental degradation (ILO,

2017b). Article 29 of the Indigenous and Tribal Peoples Convention, 1989 (No.169), emphasizes

the importance of skills development to ensure their full participation in the national economy. The

provision of skills to indigenous people can support climate change mitigation through payments for

ecosystem services (PES) schemes (see Chapter4) and ecotourism. More importantly, indigenous

and tribal peoples’ knowledge about sustainable natural resource management (in forests, sheries,

wildlife, agriculture) can be streamlined into skills development programmes and adopted more widely

to enhance the sustainability of these sectors.

In Australia, over 250 indigenous people in the Warddeken Indigenous Protected Area were provided

with accredited training courses in 2010–11 to deal with the tasks of re management, feral animal

management, weed control and the monitoring of endangered species. The project has achieved

901,075 tonnes of CO

eq in carbon abatement, which is worth US$ 4.4million (Fairbrother et al.,

forthcoming). Other impacts were reported, such as increased condence and better health and well-

being among the participants (ibid.).

The involvement of indigenous communities and the use of indigenous technologies in maintaining

ecological balance can support clean local development, such as ecotourism in the Himalayas and

the Western Ghats mountain range in India. Recognizing the multiple challenges faced by indigenous

women, the “Moco-Moco” programme in Guyana is a female entrepreneurship initiative to alleviate

the negative effects of natural disasters in indigenous communities of Region 9 (Upper Takutu-Upper

Essequibo) by improving cassava and our production for food security. It has improved the nancial

independence of the participants (Small and Witz, 2017).

Reducing gender inequality

Gender equality is central to sustainable human development and is one of the fundamental principles

for the effective greening of economies. However, the absence of equal opportunities in access to

decent jobs and training hinders the full contribution of women to the green economy (ILO, 2015b).

Gender mainstreaming in skills development could enable women to move from low-skill and entry-level

positions to high-skilled jobs and would enhance their livelihoods and independence. However, without

conscious efforts, women’s participation in the green economy will not increase rapidly enough to close

the existing gender gap (von Hagen and Willems, 2012).

There are examples of good practice in the national studies in achieving gender equality. For example,

the Australian Gas Light Company (AGL) promoted and assigned over half of its non-traditional roles

to women under its Workplace Gender Equality Agency denition. The AGL is committed to increasing

the number of women in the Senior Leadership Pipeline to 40per cent by 2019 (Fairbrother et al.,

forthcoming). In Guyana, Ruppuni Essence is a cosmetics rm that relies on single mothers to grow

lemongrass and promotes business opportunities through cooperatives (Small and Witz, 2017). In the

Philippines, rural women are offered training in organic farming to empower them and improve their

income (Fernandez-Mendoza and Lazo, forthcoming).

5. Skills for the green transition 147

As illustrated in Chapter2, the renewable energy sector has great potential for employment generation.

Achieving gender equality in the renewable energy sector is crucial, as women are under-represented

in this sector; their share in renewable energy employment stands at around 20–25per cent in some

advanced economies (Baruah, 2016). The gender gap is narrowing, albeit slowly. In the United States,

the share of women in solar employment has grown to 28per cent in 2016, although their skills levels

are lower than in other national industries (Garrett-Peltier, forthcoming). In France, the proportion of

women working in the production and distribution of energy and water has risen from 15per cent

in 2008 to 21per cent in 2012 (Cedefop, forthcoming b). In developing and emerging economies,

informal training provision plays an important role in promoting women’s skills development in solar

engineering and their participation in the sector. For example, the Barefoot College, an NGO active in

India, has pioneered skills training of women in non-electried rural villages in the eld of solar electri-

cation, and has successfully replicated the training provision model in Latin America and Africa (von

Hagen and Willems, 2012; Enel, 2017).

C. Mapping the institutional structure

of skills policies and programmes

Sections A and B have examined current efforts towards regulatory and policy coherence, as well as in

the implementation of skills development programmes in the countries surveyed. This section focuses

on institutional mechanisms that may facilitate or hinder those efforts, with an aim to draw attention

to common successful factors and bottlenecks. In particular, the analysis highlights the challenges

associated with promoting social dialogue on skills development for green transition.

Institutional mechanisms and social dialogue are key for effective policy formulation,

identication of skills needs and development of training provision

The coordination across public agendas is essential for an effective design and implementation of public

policies in general, but in the case of environmental sustainability it is absolutely vital. Indeed, conicts

of interest among issues such as environmental sustainability, economic growth and employment can

be difcult to overcome when a country’s economic activity and employment are largely reliant on

environmentally harmful industries (van de Ree, 2017). Unsuccessful coordination of interests would

hinder the promotion of skills development for the green transition.

Given this challenge, a well-functioning set of institutions and decision-making mechanisms (here-

inafter “institutional mechanisms”), which can integrate a wide-range of public agendas, such as

economic growth, public nance, social inclusion, education and employment, is essential for suc-

cessfully promoting skills development for green transition. Such institutional mechanisms include not

only those that are traditionally concerned with skills development issues (e.g. sector skills councils,

advisory committees for vocational training), but also the ones that address environmental concerns

(e.g. round tables on environment and sustainable development). In addition, the active participation

of governments, social partners and other interested bodies in the process of designing and imple-

menting skills development measures is imperative, as stipulated in the Human Resource Development

Convention, 1975 (No.142), and encouraged by the Human Resource Development Recommendation,

2004 (No.195).

The experience of the 27 countries surveyed shows that the engagement among national governments,

local governments and the social partners in the design of skills polices has led to the adoption of fully

edged policies dedicated to developing skills for the green transition or the incorporation of green

skills into TVET policies. In particular, roundtables, advisory councils and skills councils are shown to

be effective for tripartite involvement.

Mapping of policies reveals two types of institutional approaches to devising skills development meas-

ures for green transition, namely, establishing new bodies or councils specically dedicated to skills

for green transition, and mainstreaming environmental sustainability into the existing mechanisms for

148 World Employment and Social Outlook 2018 – Greening with jobs

skills development in general (table 5.3). These approaches are not mutually exclusive; some countries,

such as France, South Africa and the United Kingdom, use them simultaneously. Of the 27 countries

surveyed, four have set up specic institutional mechanisms to address skills for the green transition,

focusing on a few priority sectors. Much more commonly, 22 out of 27 countries had already estab-

lished institutional mechanisms for skills development issues in general, and 19 of them address skills

for green transition. This means that skills for green transition are not always addressed through the

existing mechanisms. In some developing and emerging economies, institutional mechanisms for skills

development in general are yet to be set up (e.g. Egypt and Mali), or have just been launched and are

active only when there are donor-funded projects with specic sectoral coverage (e.g. Bangladesh),

hence the lack of systematic platforms to regularly address skills development for green transition. In

other countries, skills for green transition are addressed only through ad hoc surveys with employers

(e.g.Costa Rica). Thus, developing and emerging economies have relatively weaker institutional cap-

acity for integrating skills and environmental sustainability.

Institutional mechanisms to anticipate skills needs and adapt training provision (27 countries)

Policy questions Are skills for green transition addressed through

existing institutional mechanisms to anticipate

skills needs and adapt training provision?

Is there a specic body or council to address

skills development for green transition?

Australia Yes –

Barbados Yes –

Brazil Yes –

China Yes

–

Costa Rica Yes –

Denmark Yes –

Estonia Yes –

Germany Yes –

Guyana Yes –

Mauritius Yes –

Indonesia Yes –

Republic of Korea Yes –

Spain Yes –

Thailand Yes –

United States

Yes –

Philippines Yes –

India – Yes

France Yes Yes

South Africa Yes Yes

United Kingdom Yes Yes

Bangladesh – –

Egypt – –

Kyrgyzstan – –

Mali – –

Montenegro – –

Tajikistan – –

Uganda – –

Total (number) 19 4

Total (percentage) 70.4 14.8

Institutional mechanisms exist at the provincial and municipal levels, but not at the national level. The 2015 edition of the Dictionary

of Occupations identies 127 green occupations but provides no description of the criteria used for the categorization. It also acknowl-

edges that those 127 occupations are only part of all the green occupations that enjoy a high degree of social acceptance.

The Green

Building Council Indonesia (GBCI) Association offers several types of training programmes in environmentally sustainable building.

In the United States, the responsibility for governing education systems is decentralized and given to each individual state. The United

States data are only for the state of California.

The Philippines Green Jobs Act 2016 mandates the Technical and Skills Development

Authority (TESDA), Green Technology Centre and the Professional Regulation Commission (PRC) for the development of training regu-

lations and qualications framework pertaining to green jobs.

Unionlearn, the learning and skills organization of the Trade Union

Congress, has established “Green Skills Partnership”, which involves unions, employers, local councils, environmental organizations,

education providers, community groups and state agencies.

Source: ILO compilation based on country reports and consultations with ILO specialists.

Table 5.3

5. Skills for the green transition 149

In addition to the institutional mechanisms, the participation of employers’ and workers’ organizations

is also a key determining factor for effective skills needs identication and training provision. Employers

can enhance the efciency of skills development policies by identifying trends in the competencies

required by the enterprises, improving the matching of skills demand and supply–including for migrant

workers (ILO, 2017c), and linking technological innovation with the creation of employment and skills

development opportunities.

On the other hand, workers’ organizations can ensure that the equity concerns are taken into consid-

eration, by addressing issues such as equitable access to training by workers of different skills levels,

migration status, gender and contractual forms (TUAC, 2016; ILO, 2016), as well as translating skills

development into higher pay and recognizing skills acquired on the job.

A positive link between the involvement of trade unions and the development of training provision

has

been identied in studies of advanced economies such as France (Le Deist and Winterton, 2012) and

the United Kingdom (Stuart and Robinson, 2007) and of emerging economies such as Argentina, Hong

Kong (China) and the Philippines (Bridgford, 2017; Smith, 2014). This is also the case in Denmark,

where stakeholders, including employers and trade unions, meet in the Advisory Council on Initial

Vocational Training (REU) (Cedefop, forthcoming d). In light of this evidence, policy-makers and other

stakeholders are encouraged to consider various ways in which trade unions can become more involved

in skills training, such as the development of skills-based collective agreements at the sectoral level and

the inclusion of training arrangements in collective bargaining at the enterprise level (Bridgford, 2017).

The 27 country studies show that skills development policies, including those for green transition, are

led by governments based on their primary responsibilities for education and pre-employment training.

The governments often engage with employers in an aim to achieve better matching of skills supply with

demand, while trade unions are less likely to be involved (e.g. Bangladesh, China, Costa Rica, India

and the Republic of Korea). Limited trade union participation carries the risk that inadequate consid-

eration will be given to the needs of workers disadvantaged on the grounds of disability, gender, skill

level, migration status, or age. For these reasons, and as specied in ILO Recommendation No.195,

governments should strengthen their support for social dialogue (Paragraph 5(h)(i)) and collective bar-

gaining (Paragraph 9(c)) in relation to training at all levels, including the national, sectoral and enterprise

levels. Furthermore, social partners are encouraged to increase their participation in designing and

implementing skills development measures for green transition.

Public funding arrangements are instrumental in supporting

the provision of training through the formal education system

Funding arrangements are one of the key drivers for the effective implementation of policies for the

transition to a green economy. National studies nd that public nancial support has led to the cre-

ation of new channels for the provision of training, including departments at universities and graduate

schools, and training programmes in TVET institutions (e.g. Republic of Korea). Importantly, public

nancial support has enabled disadvantaged groups to participate in training programmes free of

charge. However, the sustainability of public funding remains a concern, suggesting the need for com-

plementarity with a market-based approach and employer-led initiatives.

Fiscal instruments have generated strong incentives

for employers to provide training

Fiscal reforms in the form of tax exemptions and social security rebates have proved to be a successful

incentive for the provision of training by employers in the area of skills for green transition. When

such scal incentives are in place, the number of employees receiving such training is seen to go up

(Cedefop, forthcoming g). However, the experience of some countries (e.g. Spain) shows that, while

the number of employees trained has doubled, the average duration of each training action has halved,

suggesting the need for quality assurance mechanisms.

10. See Bridgford (2017) for a review of the literature.

150 World Employment and Social Outlook 2018 – Greening with jobs

The absence of national or sectoral policies can undermine

the sustainability of training programmes

In developing countries, training programmes are often implemented with the support of international

development agencies and tend to be discontinued when the projects come to an end. A country-led

approach is an effective way of ensuring the sustainability of these programmes and their progressive

application to more sectors of the economy. In addition to sustainability, the training of trainers is a

challenge. The development of new training techniques, especially through the use of information

technology, may offer opportunities for improvement.

The lack of consensus on the denition of green jobs at the national level

hinders skills development for green transition in many countries

The 27 country studies show that most of the sample countries have not yet reached consensus on

the denition of green jobs.

In countries such as Denmark, France, the Philippines, South Africa,

the United Kingdom and the United States, ofcial denitions of green jobs exist – and yet even in

those countries the debate over what should be dened as green jobs is still ongoing. This lack of con-

sensus on the denition of green jobs is an obstacle to the systematic design and implementation of

skills strategies, skills needs identication and training provision. In 2013, progress was made towards

establishing an operational denition of green jobs at the 19th International Conference of Labour

Statisticians (ILO, 2013). However, implementation of the denition largely depends on country-specic

contexts and capacity, and many of the sample countries face challenges in this regard. In order to

support its member States, the ILO has conducted pilot projects for generating statistics on green jobs

based on the 2013 operational denition in Albania and Mongolia, which led to initial identication

of green jobs by sex, level of education, occupation and main economic activity (Stoevska, Elezi and

Muraku, 2014; Oyunbileg and Stoevska, 2017). In addition to surveys, other data sources such as

input–output tables can also be used for projecting the employment impact of the green transition. In

this regard, the Green Jobs Assessment Institutions Network (GAIN) published a training guidebook

in 2017 (GAIN, 2017).

Conclusions

This chapter has examined the formulation and implementation of existing policies and programmes in

the area of skills development for the green transition in terms of their policy coherence with broader

environmental sustainability policies, and identied success factors and obstacles.

There are signs of emerging policy coherence between skills development and environmental sustain-

ability policies. However, the scope and degree of this emerging policy coordination tends to be limited

to specic policy areas, target groups, sectors and regions. Among the success factors, regulatory

instruments (e.g. energy law reforms) are often found to be effective in initially setting in motion skills

policy formulation and implementation. However, in view of the prescriptive nature of regulatory tools,

such as the vocational qualication and training requirements set out in energy regulations, the adapt-

ability of training to changes in skills needs is still unproven. Policies and regulations have to achieve

the right balance between exible adjustment to the skills needed in the market, the establishment

of qualication standards and the mainstreaming of skills for green transition in formal TVET systems

over the longer term. National experience reveals a wide range of challenges faced by policy-makers,

social partners and other relevant stakeholders. These challenges include the absence of consensus

on the denition of green jobs, lack of capacity at the national level to collect, disseminate and analyse

relevant data, and the evolving nature of skills needed for the green transition.

11. See van de Ree (2017) for a review of the various denitions.

5. Skills for the green transition 151

Given the current pace of progress, there is a risk that some of the commitments made in nationally de-

termined contributions (NDCs) and the SDGs will not be met by the target year. In light of the Guidelines

for a just transition to environmentally sustainable economies and societies for all (ILO, 2015a), there

are a number of areas in which greater efforts are needed. Consideration of the following areas is par-

ticularly important in ensuring decent work and social inclusion.

First, gender mainstreaming needs to be strengthened in many skills development policies and pro-

grammes. The ILO (2017d) nds that there are considerable gender inequalities in the form of occu-

pational and sectoral segregation. However, the 27 country studies show that gender equality is not

mainstreamed in key policy documents on skills development for the green transition. Without a clear

recognition of and efforts to narrow the gender gap in terms of sectoral/occupational segregation and

access to training, there is a high risk that the transition to a green economy will only perpetuate the

existing situation. For example, women are under-represented in the science, technology, engineering

and mathematics (STEM)-related elds, and over-represented in recycling and waste collection, which

are characterized by low pay and poor working conditions (Strietska-Ilina, 2017). Consequently, current

efforts to narrow the gender gap in entry, retention and advancement rates during vocational training

programmes in STEM elds, as well as those aimed at promoting working conditions in waste manage-

ment sectors, need to be stepped up.

Second, global and regional partnerships need to be strengthened in the area of skills development

for a green transition. In this regard, international and technical cooperation in human resource de-

velopment should promote national capacity building to reform and develop training policies and

programmes.

The research conducted for this chapter conrms that there is strong demand from

lower-income countries for the sharing of good practices, in terms of both the formulation and im-

plementation of policies and regulations. Cross-border knowledge-sharing can promote regional and

international approaches to skills development for the green transition, which can in turn address the

competitiveness concerns of individual countries.

Finally, most of the policies and programmes identied in this chapter are targeted at semi-skilled

and skilled jobs, with the latter being concentrated especially in the energy sector and other sectors

closely related to environmental protection. In terms of support for the transition of low-skilled workers,

some examples of short or ad hoc training have been identied, but hardly any more systematic active

labour market policies to support disadvantaged groups in the development of appropriate skills. In

developing and emerging countries, low-skilled workers might benet from social protection measures

and programmes to formalize employment, in addition to skills development. It should be recognized

that training in environmental hazard management and environmentally friendly techniques could make

a signicant contribution to workers’ health and well-being (Chapter4).

The challenges described in this chapter suggest that there is an urgent need to improve under-

standing of the mechanisms through which a country-specic policy mix can have an impact on skills

development for the green transition. In recognition of this need, the ILO will follow up on the analysis

undertaken in this chapter with a view to developing detailed policy recommendations for each country

that could lead to technical assistance to the countries surveyed.

12. Paragraph 21 of Recommendation No.195.

152 World Employment and Social Outlook 2018 – Greening with jobs

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Appendices 157

Appendix 1

1. COUNTRIES THAT HAVE DECOUPLED ECONOMIC GROWTH

FROMGREENHOUSE GAS EMISSIONS

In a green economy it is said that economic activity is decoupled from greenhouse gas (GHG) emis-

sions. At the rst level, this means that economic activity is decoupled from the GHG emissions

embedded in the production of goods and services. At the second level, and in open economies, this

means that economic activity is decoupled from the GHG emissions embedded in the consumption

of goods and services. Economic growth is therefore compared with the growth in production-based

emissions to identify countries that have decoupled production:

• Using data from the World Development Indicators (World Bank, 2017), country-specic trends are

constructed from 1995 to 2012, country-level statistics for annual per capita GDP and annual per

capita GHG emissions.

• Using OLS regression models, the average annual growth is estimated in per capita GDP and per

capita GHG emissions (inper cent). For each country

c, we estimate:

logGDP

c,y

=β

0,c

+ β

1,c

year

+ e

c,y

and

logGHG

c,y

=γ

0,c

+ γ

1,c

year

+ e

c,y

where β

1,c

and γ

1,c

are each country’s average annual percentage changes in per capita GDP and GHG

emissions, respectively.

• Countries with

1,c

> 0 and γ

1,c

< 0 are countries that experienced economic growth in the 1995–2012

period and reduced their per capita emissions during that period. These countries decoupled eco-

nomic growth from production-based emissions.

Of the subset of countries that decoupled economic growth from production-based emissions, those

that also decoupled from consumption-based emissions are identied as follows:

• Using historical data from the National Footprint Accounts covering the years 1960–2012, aug-

mented by 2013 data (Global Footprint Network, 2016 and 2017), country-specic annual carbon

consumption-based emissions trends are constructed.

• Using OLS regressions, the average annual change in the carbon footprint is estimated:

logCFoot

c,y

= μ

0,c

+ μ

1,c

year

+ e

c,y

• Countries with β

1,c

> 0, γ

1,c

< 0 and μ

1,c

< 0 are countries that decoupled economic growth from pro-

duction-based emissions and consumption-based emissions.

Appendices

158 World Employment and Social Outlook 2018 – Greening with jobs

2. THE RELATIONSHIP BETWEEN EMPLOYMENT OUTCOMES

AND DECOUPLING GDP GROWTH AND EMISSIONS

Figure 1.5, analysing the relationship between employment outcomes and the ability of countries to

decouple GHG emissions from GDP, measures the correlation between decent work indicators and

GHG emissions for countries worldwide with the data available between 1995 and 2014. Regression

models estimate

logGHG

y,c

= logEmp

y,c

+ c + y + e

y,c

as the marginal model where logGHG

y,c

are country c’s GHG emissions per capita in year y and c and

y are country and annual xed effects, respectively. We also estimate

logGHG

y,c

= logEmp

y,c

+ logGDP

y,c

+ logEInt

y,c

+ logPop

y,c

+ logUrban

y,c

+ c + y + e

y,c

as the conditional model, which adds controls for log GDP per capita, log energy intensity, log popu-

lation and the log share of the urban population. For both the marginal and conditional models, one

distinct model is estimated for each employment outcome, namely, working poverty (the percentage

of workers living in extreme or moderate working poverty who live on less than US$ 3.10 PPP per

day), the labour share of income, the female labour participation rate, the employment-to-population

ratio and interaction effects to evaluate the sectoral distribution of employment, and self-employment

(the percentage of workers who are employers, own-account workers, contributing family workers or

members of producer cooperatives).

Results hold when the regressions are carried out separately for high-income, upper middle-income,

lower middle-income and low-income countries. Results also hold when the regressions are carried out

separately for coupled and decoupled countries. For results to hold within each country categorization,

outlier cases are eliminated: Equatorial Guinea (average annual percentage change in GHG emissions

of 54.8 and average annual percentage change in GDP per capita of 19.7), Afghanistan (20.4, 4.6),

Angola (13.8, 4.4), Bosnia and Herzegovina (12.3, 11.7), Lao People’s Democratic Republic (10.4, 5.3),

Mozambique (9.5, 5.5) and Eswatini (9.4, 2.0).

Table A1.1 shows the regression results for the full-country model:

Relationship between employment outcomes and GHG emissions

a. Working poverty b. Labour share of income

 Marginal Conditional Marginal Conditional

Working poverty –0.703*** –0.185*** Labour share

of income

–0.302*** –0.0362

(0.0648) (0.0546) (0.113) (0.0867)

GDP growth 1.254*** GDP growth 1.108***

(0.0344) (0.0285)

Population growth 0.831*** Population growth 0.508***

(0.0604) (0.0415)

Energy intensity 0.789*** Energy intensity 0.722***

(0.0249) (0.0250)

Share of urban

population

0.0780 Share of urban

population

0.810***

(0.172) (0.156)

Constant 0.0732** –25.24*** Constant 0.913*** –19.07***

(0.0360) (1.117) (0.0650) (0.762)

Year FE YES YES Year FE YES YES

Country FE YES YES Country FE YES YES

R-squared 0.302 0.607 R-squared 0.110 0.500

No.countries 121 121 No.countries 126 126

No.observations 2 233 2 233 No.observations 2 402 2 402

Table A1.1

Appendices 159

c. Female labour participation rate d. Employment-to-population ratio

 Marginal Conditional Marginal Conditional

Female labour

participation rate

–2.072*** –0.724*** Employment-to-

population ratio

–1.798*** – 0.174

(0.317) (0.234) (0.178) (0.136)

GDP growth 1.198*** Employment-to-

population ratio

× Industry

4.383*** 0.501***

(0.0254) (0.232) (0.188)

Population growth 0.552*** Employment-to-

population ratio

× Services

1.891*** –0.783***

(0.0387) (0.180) (0.146)

Energy intensity 0.788*** GDP growth 1.229***

(0.0209) (0.0241)

Share of urban

population

0.772*** Population growth 0.481***

(0.138) (0.0364)

Constant 1.202*** –20.34*** Energy intensity 0.769***

(0.126) (0.713) (0.0203)

Year FE YES YES Share of urban

population

0.751***

Country FE YES YES (0.135)

R-squared 0.150 0.555 Constant 0.530*** –19.45***

No.countries 170 170 (0.0988) (0.652)

No.observations 3 170 3 170 Year FE YES YES

Country FE YES YES

R-squared 0.230 0.587

No.countries 177 177

No.observations 3 473 3 473

e. Self-employment

 Marginal Conditional

Self employment –1.601*** 0.0935

(0.139) (0.114)

GDP growth 1.305***

(0.0345)

Population growth 0.858***

(0.0609)

Energy intensity 0.791***

(0.0256)

Share of urban

population

0.0987

(0.174)

Constant 0.618*** –26.23***

(0.0780) (1.144)

Year FE YES YES

Country FE YES YES

R-squared 0.307 0.605

No.countries 121 121

No.observations 2 233 2 233

Notes: Standard errors in parentheses. A marginal and conditional time series (1995–2014) regression is estimated for each decent

work indicator. All regression models consider yearly logGHG emissions per capita as the dependent variable and the decent work indi-

cator as the independent variable. All models include country and year xed effects. The marginal model includes only the relationship

between each decent work indicator and logGHG emissions per capita. The conditional model adds controls for logGDP, log population,

log energy intensity and the log share of the urban population. The model for employment shares by sector includes agriculture as the

reference category. * p < 0.05, ** p < 0.01, *** p < 0.001.

Source: ILO calculations based on World Development Indicators, Penn World Tables and ILOSTAT.

Table A1.1 (cont’d)

160 World Employment and Social Outlook 2018 – Greening with jobs

3. THE CARBON AND RESOURCE INTENSITY OF EMPLOYMENT

For GHG emissions (carbon) and each resource (material, freshwater and land), the total emissions

(in Kt) or resources (in Kt, billion m

or thousand Ha) are estimated that are associated with each

employed person. In particular:

• for the carbon intensity of employment, each region’s total GHG emissions (World Development

Indicators) are divided by its total employment in thousands (ILO-modelled estimates) (ILOStat);

• for the material intensity of employment, each region’s total material extraction (Material Flows Data)

is divided by its total employment in thousands (ILO-modelled estimates) (ILOStat);

• for the freshwater intensity of employment, each region’s total freshwater withdrawals (World

Development Indicators) are divided by its total employment in thousands (ILO-modelled estimates)

(ILOStat); and

• for the land use of employment, each region’s total land use (FAOStat) is divided by its total

employment in thousands (ILO-modelled estimates) (ILOStat).

4. WORKING-LIFE YEARS LOST DUE TO HUMAN-INDUCED DISASTERS

The estimate of working-life years lost due to disasters adapts Noy’s (2014) methodology to the world

of work. It takes into account the fact that people do not work during their entire life and that not all

the population works. Noy estimates a benchmark index for life years lost due to disasters whereby

Lifeyears = L(M,A

death

, A

exp

) + I(N) + DAM(Y,P)

• L(M,A

death

, A

exp

) = M(A

exp

– A

med

) is the number of years lost due to mortality as a result of events, cal-

culated as the difference between age at death and life expectancy. In global data sets, information

about the age at death is not available, so the median age of the population (

med

) is used instead.

•

I(N) = eTN is the cost function associated with people who were injured or otherwise affected by

the disaster, which follows the WHO (2013) methodology for calculating disability-adjusted life years

(DALYs). The coefcient

e is the “welfare-reduction weight” that is associated with being exposed to a

disaster. The WHO weighting is adopted for disability associated with “generic uncomplicated disease:

anxiety about diagnosis” (

e = 0 .0 5 4). T( = 3 years) is the time it takes an affected person to return

to normality or for the impact of the disaster to disappear, while

N is the number of people affected.

•

DAM(Y,P) = Y(1 – c) × pcGDP

–1

estimates the number of life years lost as a result of the damage

to capital assets and infrastructure (the opportunity cost of spending human resources (effort) on

the reconstruction of the destroyed assets).

Y is the amount of nancial damage usually indicated

in information about disaster impacts.

P is the monetary amount obtained in a full year of human

effort. Income per capita (

pcGDP) is used as an indicator of the cost of human effort, but dis-

counted by 75per cent (

c) to account for the observation that much time is spent in activities that

are not related to work.

The index is adapted to relate better to the world of work and considers only disasters caused or en-

hanced by human intervention in the environment (anthropogenic disasters). In practice, we estimate:

Worklifeyears = [L(M,A

death

, A

retirement

) + I(N) + DAM(Y,P)]e

Noy’s approach is adapted by measuring A

retirement

instead of A

exp

because people are not expected

to continue working beyond the age of 65. When a country’s life expectancy is higher than 65,

retirement

=65, otherwise A

retirement

= A

exp

is used.

In addition, the nal result is weighted by the employment-to-population ratio (e) to take into account

the proportion of a country’s population that works.

Finally, disasters and natural hazards in the EM-DAT Disaster Database are only considered when they

are caused or enhanced by human intervention in the environment or environmental degradation.

This includes meteorological (storms, fog, extreme temperature), hydrological (oods, landslides, wave

action), climatological (drought, glacial lake outburst, wildres), biological (insect infestation) and cer-

tain technological (industrial or miscellaneous accidents) hazards. Estimates do not include casual-

ties, people affected or damages resulting from geophysical (earthquake, mass movement, volcanic

activity), biological (viral, bacterial, parasitic, fungal or prion disease epidemics, animal accidents),

extraterrestial (impact, space weather) or certain technological (transport accidents) hazards.

Appendices 161

5. THE IMPACT OF HEAT STRESS IN THE WORLD OF WORK

The methodological details for labour impact analysis follow Kjellstrom et al. (2017). The analysis of

the projected impact of climate change on heat stress is based on grid cell data (0.5 x 0.5 degrees or

50 x 50 km at the Equator) for climate variables combined with population size estimates for four age

groups (0 to 4 years, 5 to 14, 15 to 64 and 65 years or older) and employment distribution by broad

economic sector.

The climate data use 30-year averages, identied by their mid-points: 1995, 2025, 2055 and 2085. The

data for 2085, for example, draw on the average projected temperatures for each grid cell between 2071

and 2099. The HadGEM2-ES (Martin et al., 2011) and GFDL-ESM2M (Dunne et al., 2012 and 2013)

provide the high- and low-end climate data and projections. These two models represent the range of

25 models used in the most recent assessments by the Intergovernmental Panel on Climate Change

(IPCC, 2013). This report uses the average of the two, avoiding the calculation of heat stress impact

across all the various climate projections available.

Most models correct bias in the temperature with

measured data from weather stations over a long historical period. The bias correction in this report also

corrects for humidity, which is a relevant parameter in assessing the human health risks of temperature.

The results shown in the report use future modelled estimates for representative GHG pathways RCP2.6

(ibid.). Pathway RCP2.6 gives a mean global temperature increase of 1.5°C by the end of the century.

Following Kjellstrom et al. (2017) and Kjellstrom and McMichael (2014), the heat stress index (the

Wet Bulb Globe Temperature (WBGT) in degrees Celsius (°C)) is calculated by combining climate

temperature (°C) and humidity (dew point, in °C) assuming air movement over the skin at 1 m/s (the

speed at which arms or legs move when working) and in the shade or indoors without air conditioning.

The heat stress index for work in the sun in the afternoon adds 2°C to the in-shade WBGT. Estimates of

temperature and WBGT based on monthly mean temperature, and estimates of temperature and WBGT

based on daily maximum temperature are used to derive the typical hourly distribution of heat levels.

The population data are based on United Nations population estimates and assessments of age distri-

bution from the International Institute for Applied Systems Analysis (Lutz, Butz and Samir, 2014). For

grid cells on the boundaries of regions or countries, the estimated population is distributed in the same

proportion as the land distribution.

Data on workforce distribution in agriculture, industry and services at the country and subregional

levels come from ILO Key Indicators of the Labour Market (ILO, 2015).

Following Kjellstrom et al. (2017), the results estimate heat stress approximate exposure–response

relationships for work intensities at 200W (clerical or light physical work), 300W (moderate physical

work in manufacturing) and 400W (heavy physical work in agriculture or construction). They allow for

the conversion of an environmental heat level (expressed as WBGT) to a percentage of unavailable work

capacity if the worker reduces work intensity to avoid clinical health effects. The loss of work hours

is calculated using the exposure–response equations for each daylight hour of a month or a year for

each grid cell. The lost hours per person in different work types are then added up for all grid cells in

a geographic area (e.g. subregions). The number of lost hours in each occupation type is also added

and compared with the total hours available for work in each daylight 12-hour period.

No matter what the conditions, some work is always possible because, if the person does not release any

heat at all, the specic heat of the body (3470 J/(kg × °C)) allows at least 6 minutes in the hour before

the core temperature reaches an intolerable 39°C. Also, even when working continuously, it is necessary

to take “micro-breaks” to stretch, go to the toilet, or simply relax. It is assumed that 10per cent of work

time is used in this way. In the impact assessments, a cut-off is used at 10per cent time lost (full work

up to this level) and 90per cent time lost (10per cent of work, or 6 minutes, which is always possible).

With the large population in several regions and the calculated fractions of hot days at a very hot level

based on mathematical functions, relatively large numbers of lost work hours can emerge from these

fractions of days or hours. To avoid overestimating the hours affected by heat, the mathematical func-

tions are trimmed at 1per cent, providing conservative estimates, especially in temperate regions.

1. Both the HadGEM2-ES and the GFDL-ESM2M models are available at the Inter-Sectoral Impact Model Intercomparison Project

(ISIMIP): www.isimip.org.

162 World Employment and Social Outlook 2018 – Greening with jobs

Appendix 2

1. USING MULTIREGIONAL INPUT–OUTPUT TABLES TO ESTIMATE

THE EMPLOYMENT EFFECTS IN A GREEN ECONOMY

This appendix provides methodological details on the procedure used to estimate the number of jobs

created and destroyed, as well as the change related to wages, emissions and skills, and gender com-

position of the economy under certain scenarios associated with a low-carbon and resource- efcient

economy. It rst describes the data set, the general methodological approach and the specic assump-

tions used in each scenario.

Data

Exiobase is a multiregional input–output and supply-and-use table (MRIO) and reports the interlink-

ages between nal consumption, the ow of intermediate and nal goods and factor inputs into pro-

duction. The environmental and socio-economic extensions to these databases allow analysis of the

corresponding impacts along global value chains resulting from changes in global production net-

works. Exiobase covers 163 industries (for the symmetric input–output tables) and 200 products

(for the supply-and-use tables) across 44 countries and ve rest-of-the-world regions. It reports total

employment, total female employment, total employment by skills level, vulnerable employment and

total GHG emissions for each sector in each country, which is of special relevance to the present report.

Tukker et al. (2013) and Wood et al. (2015) provide more information on Exiobase and its potential

uses. Simas et al. (2014) provide a description of the employment and vulnerable employment ac-

counts in the context of MRIO tables.

As described in Simas et al. (2014), Exiobase constructs labour inputs from national labour force

surveys gathered from ILOStat, and a combination of labour force and industrial surveys in national

accounts, obtained from the OECD STAN database. Labour data from the ILO consist of 39 economic

sectors, while STAN data cover up to 60 industries, which provides a better allocation for economic

output in the MRIO sectors. Labour inputs were disaggregated from broad economic sectors into in-

dustries in the MRIO according to the compensation of employees from the model. The disaggregation

was made under the assumption that average wages and hours worked would be similar between all

workers within a broad economic sector or industry.

Vulnerable employment in Exiobase follows ILO definitions, which include unpaid contributing

family workers and own-account workers. The ILO and the OECD provide sector-level data on both

employment and paid employees for all countries in the Exiobase. A weighted average ratio of paid

employees per total employment for countries in the region for three broad sectors (agriculture, in-

dustry and services) identies vulnerable employment in each of the ve rest-of-the-world regions.

Labour inputs in the MRIO model are divided into three skill levels (low, medium and high). The skill

level of occupations is identied such that low-skilled occupations are all ISCO code 9 occupations,

medium-skilled occupations are all ISCO code 4, 5, 6, 7 and 8 occupations, and high-skilled occu-

pations are all ISCO code 1, 2 and 3 occupations. ILO sectoral data on occupations for all countries

in Exiobase are used to construct the number of workers at each skill level in each sector. For the

rest-of-the-world regions, each industry has a weighted average distribution of skill levels in total

employment for three broad sectors: agriculture, industry and services.

Exiobase v3 maps the world economy in 2011, but has been updated to 2014 (Stadler et al., 2018).

Projections up to 2030 combine International Monetary Fund (IMF) GDP projections to 2022 with the

International Energy Agency (IEA) regional growth projections to 2030. Except for the changes mod-

elled in the scenarios – as described below – the basic trade and country-specic sectoral structure of

the world economy remains as described by the IMF projections (IEA, 2015; IMF, 2017).

Although analyses are carried out with the disaggregated table, the results in this report are aggregated

by industry (agriculture, construction, fossil fuels and nuclear electricity production, manufacturing,

mining, renewable-energy electricity production, services, utilities, and waste management and recy-

cling), to facilitate reporting. Results are also aggregated at the regional level (Africa, Americas, Asia,

Europe and Middle East). Due to data constraints, Exiobase regions differ slightly from ILO regional

groupings. Table A2.1 shows the industry aggregation used in the report.

1. Exiobase is available through the project’s website: www.exiobase.eu .

Appendices 163

Exiobase industry aggregation used in the report

Industries Aggregated industry

Cultivation of paddy rice Agriculture

Cultivation of wheat Agriculture

Cultivation of cereal grains n.e.c. Agriculture

Cultivation of vegetables, fruit, nuts Agriculture

Cultivation of oil seeds Agriculture

Cultivation of sugar cane, sugar beet Agriculture

Cultivation of plant-based bers Agriculture

Cultivation of crops n.e.c. Agriculture

Cattle farming Agriculture

Pig farming Agriculture

Poultry farming Agriculture

Meat animals n.e.c. Agriculture

Animal products n.e.c. Agriculture

Raw milk Agriculture

Wool, silk-worm cocoons Agriculture

Manure treatment (conventional), storage and land application Agriculture

Manure treatment (biogas), storage and land application Agriculture

Forestry, logging and related service activities Agriculture

Fishing, operating of sh hatcheries and sh farms; service activities incidental to shing Agriculture

Mining of coal and lignite; extraction of peat Mining

Extraction of crude petroleum and services related to crude oil extraction, excluding surveying Mining

Extraction of natural gas and services related to natural gas extraction, excluding surveying Mining

Extraction, liquefaction and regasication of other petroleum and gaseous materials Mining

Mining of uranium and thorium ores Mining

Mining of iron ores Mining

Mining of copper ores and concentrates Mining

Mining of nickel ores and concentrates Mining

Mining of aluminium ores and concentrates Mining

Mining of precious metal ores and concentrates Mining

Mining of lead, zinc and tin ores and concentrates Mining

Mining of other non-ferrous metal ores and concentrates Mining

Quarrying of stone Mining

Quarrying of sand and clay Mining

Mining of chemical and fertilizer minerals, production of salt, other mining and quarrying n.e.c. Mining

Processing of meat cattle Manufacturing

Processing of meat pigs Manufacturing

Processing of meat poultry Manufacturing

Production of meat products n.e.c. Manufacturing

Processing of vegetable oils and fats Manufacturing

Processing of dairy products Manufacturing

Processed rice Manufacturing

Sugar rening Manufacturing

Processing of food products n.e.c. Manufacturing

Manufacture of beverages Manufacturing

Manufacture of sh products Manufacturing

Manufacture of tobacco products Manufacturing

Manufacture of textiles Manufacturing

Manufacture of wearing apparel; dressing and dyeing of fur Manufacturing

Tanning and dressing of leather; manufacture of luggage, handbags,

saddlery, harnesses andfootwear

Manufacturing

Manufacture of wood and of products of wood and cork, except furniture; manufacture of articles

of straw and plaiting materials

Manufacturing

Reprocessing of secondary wood material into new wood material Waste mgt. and recycling

Pulp Manufacturing

Reprocessing of secondary paper into new pulp Waste mgt. and recycling

Table A2.1

164 World Employment and Social Outlook 2018 – Greening with jobs

Industries Aggregated industry

Paper Manufacturing

Publishing, printing and reproduction of recorded media Manufacturing

Manufacture of coke oven products Manufacturing

Petroleum renery Manufacturing

Processing of nuclear fuel Manufacturing

Plastics, basic Manufacturing

Reprocessing of secondary plastic into new plastic Waste mgt. and recycling

N-fertilizer Manufacturing

P- and other fertilizers Manufacturing

Chemicals n.e.c. Manufacturing

Manufacture of rubber and plastic products Manufacturing

Manufacture of glass and glass products Manufacturing

Reprocessing of secondary glass into new glass Waste mgt. and recycling

Manufacture of ceramic goods Manufacturing

Manufacture of bricks, tiles and construction products, in baked clay Manufacturing

Manufacture of cement, lime and plaster Manufacturing

Reprocessing of ash into clinker Waste mgt. and recycling

Manufacture of other non-metallic mineral products n.e.c. Manufacturing

Manufacture of basic iron and steel and of ferro-alloys and rst products thereof Manufacturing

Reprocessing of secondary steel into new steel Waste mgt. and recycling

Precious metals production Manufacturing

Reprocessing of secondary precious metals into new precious metals Waste mgt. and recycling

Aluminium production Manufacturing

Reprocessing of secondary aluminium into new aluminium Waste mgt. and recycling

Lead, zinc and tin production Manufacturing

Reprocessing of secondary lead into new lead, zinc and tin Waste mgt. and recycling

Copper production Manufacturing

Reprocessing of secondary copper into new copper Waste mgt. and recycling

Other non-ferrous metal production Manufacturing

Reprocessing of secondary other non-ferrous metals into new other non-ferrous metals Waste mgt. and recycling

Casting of metals Manufacturing

Manufacture of fabricated metal products, except machinery and equipment Manufacturing

Manufacture of machinery and equipment n.e.c. Manufacturing

Manufacture of ofce machinery and computers Manufacturing

Manufacture of electrical machinery and apparatus n.e.c. Manufacturing

Manufacture of radio, television and communication equipment and apparatus Manufacturing

Manufacture of medical, precision and optical instruments, watches and clocks Manufacturing

Manufacture of motor vehicles, trailers and semi-trailers Manufacturing

Manufacture of other transport equipment Manufacturing

Manufacture of furniture; manufacturing n.e.c. Manufacturing

Recycling of waste and scrap Waste mgt. and recycling

Recycling of bottles by direct reuse Waste mgt. and recycling

Production of electricity by coal Fossil and nuclear

Production of electricity by gas Fossil and nuclear

Production of electricity by nuclear Fossil and nuclear

Production of electricity by hydro Renewables

Production of electricity by wind Renewables

Production of electricity by petroleum and other oil derivatives Fossil and nuclear

Production of electricity by biomass and waste Renewables

Production of electricity by solar photovoltaics Renewables

Production of electricity by solar thermal Renewables

Production of electricity by tide, wave, ocean Renewables

Production of electricity by geothermal Renewables

Production of electricity n.e.c. Renewables

Transmission of electricity Utilities

Table A2.1 (cont’d)

Appendices 165

Industries Aggregated industry

Distribution and trade of electricity Utilities

Manufacture of gas; distribution of gaseous fuels through mains Utilities

Steam and hot water supply Utilities

Collection, purication and distribution of water Utilities

Construction Construction

Reprocessing of secondary construction material into aggregates Waste mgt. and recycling

Sale, maintenance, repair of motor vehicles, motor vehicle parts, motorcycles,

motorcycle parts and accessories

Services

Retail sale of automotive fuel Services

Wholesale trade and commission trade, except of motor vehicles and motorcycles Services

Retail trade, except of motor vehicles and motorcycles; repair of personal and household goods Services

Hotels and restaurants Services

Transport via railways Services

Other land transport Services

Transport via pipelines Services

Sea and coastal water transport Services

Inland water transport Services

Air transport Services

Supporting and auxiliary transport activities; activities of travel agencies Services

Post and telecommunications Services

Financial intermediation, except insurance and pension funding Services

Insurance and pension funding, except compulsory social security Services

Activities auxiliary to nancial intermediation Services

Real estate activities Services

Renting of machinery and equipment without operator and of personal and household goods Services

Computer and related activities Services

Research and development Services

Other business activities Services

Public administration and defence; compulsory social security Services

Education Services

Health and social work Services

Incineration of waste: Food Waste mgt. and recycling

Incineration of waste: Paper Waste mgt. and recycling

Incineration of waste: Plastic Waste mgt. and recycling

Incineration of waste: Metals and inert materials Waste mgt. and recycling

Incineration of waste: Textiles Waste mgt. and recycling

Incineration of waste: Wood Waste mgt. and recycling

Incineration of waste: Oil/hazardous waste Waste mgt. and recycling

Biogasication of food waste, incl. land application Waste mgt. and recycling

Biogasication of paper, incl. land application Waste mgt. and recycling

Biogasication of sewage sludge, incl. land application Waste mgt. and recycling

Composting of food waste, incl. land application Waste mgt. and recycling

Composting of paper and wood, incl. land application Waste mgt. and recycling

Waste water treatment, food Waste mgt. and recycling

Waste water treatment, other Waste mgt. and recycling

Landll of waste: Food Waste mgt. and recycling

Landll of waste: Paper Waste mgt. and recycling

Landll of waste: Plastic Waste mgt. and recycling

Landll of waste: Inert/metal/hazardous Waste mgt. and recycling

Landll of waste: Textiles Waste mgt. and recycling

Landll of waste: Wood Waste mgt. and recycling

Activities of membership organizations n.e.c. Services

Recreational, cultural and sporting activities Services

Other service activities Services

Private households with employed persons Services

Extra-territorial organizations and bodies Services

Table A2.1 (cont’d)

166 World Employment and Social Outlook 2018 – Greening with jobs

Methods

Given that MRIO tables record the ow of intermediate goods and services in the world economy, they

map the inter-industry linkages within an economy. MRIOs capture the indirect effects (changes in

other industries, e.g. coal mining) of changes in one specic industry (e.g. the electricity generation

sector). This logic can be extended to the estimation of effects on industry-specic employment and

wages, as well as on skills demand, gender composition at the industry level and environmental impact

(e.g. GHG emissions, as well as land, water and resource use).

If, for example, 10per cent of the inputs into the car industry are provided by the steel industry and

the steel industry needs ten employees to produce one unit of output, then one employee (= 10per

cent of ten employees) in the steel industry is (indirectly) employed because of the production of one

unit in the car industry.

Using the common input–output notation the indirect employment effect of one unit of production of

industry

j is calculated as

where

e is a vector of direct employment per unit of output for all industries, L is the Leontief inverse,

is a vector where all entries are equal to zero except the entry corresponding to industry j which

equals 1, and

is the direct employment per unit of output of industry j.

As employment is recorded in the value added block of the MRIO, this logic can be extended to other

records in the MRIO, including vulnerable employment, employment by gender and skill level or the

block of environmental accounts, as is the case for GHG emissions.

Miller and Blair (2009) provide more details on the use of input–output tables.

Applying input–output data in a scenario framework requires consideration of many factors. Basic

input–output scenarios imply a series of direct and exogenous changes in nal demand and the

production structure, i.e. technological change (Koning et al., 2016; Wiebe, 2016). The results must

be understood as a comparison between the status quo and a result in which the scenario, ceteris

paribus, has been achieved. Results from MRIO scenarios are rst-order impacts, devoid of the effects

of assumptions about substitution elasticities, utility and prot maximization, price equilibrium, etc.

Some key assumptions include:

• Prices are not endogenized, that is, relative prices between products and countries do not change.

Changes in relative prices resulting from technological change would lead, for example, to changes

in the production structure and production locations through substitution or complementary effects.

• All changes implemented in the model are exogenous, which makes it impossible to model systemic

rebound effects (i.e. macro-economic price or growth effects).

• Market shares and bilateral trade shares remain constant.

Implementing technological change in an MRIO

As described by Wiebe (2018), the transition to a green economy requires structural and technological

change. Several scenarios in this report involve technological change to a certain extent. For example,

electricity generation shifts from fossil fuels to renewables; agriculture changes to conservation or

organic agriculture, shifting the sets of inputs required, and in a circular economy metal inputs change

from direct manufacture and mining to recycling.

In an input–output framework, both the economic structure and technology are represented as the

intermediate input coefcients. But modelling technological change in an economy by changing the

input coefcients alone is not sufcient. Wiebe (2018) explains how to consistently model technological

change in a forward-looking multiregional input–output model and, to this end, differentiates between

ve types of changes regarding parts of the input–output system (as shown in gure A2.1):

2. Gillingham et al. (2013) argue that rebound effects are generally small.

3. This section follows the discussion already noted in Wiebe (2018).

ind

= e’Li

– e

indirect total direct

employment employment employment

Appendices 167

1. Gross xed capital formation

2. Input coefcients for technology production

3. Input coefcients for technology use

4. Emission intensity of production (or any other relevant environmental or socio-economic extension)

5. Value added shares, including compensation of employees.

In Wiebe (2018), these changes are explained using the example of increasing electricity production

through wind turbines. The goal is for more electricity to be produced by wind relative to the status quo

in the current input–output system. The rst step in the process is to invest in more wind parks. This

is shown in gure A2.1 as input–output table (IOT) change 1, a change in gross xed capital formation

(GFCF). For the sake of simplicity, the arrow in the gure points only to the machinery and equipment

industry, which produces wind turbines. But it is important to remember that the wind turbines need to

be planned, which requires services from “other business activities”, and to be connected to the grid,

which requires products from the “electrical machinery and apparatus” industry, to mention the other

two most important industries associated with an investment in a new wind park.

Once the investment is made, the technology (wind turbines) needs to be produced. As more wind

turbines are produced relative to other products in the machinery and equipment industry, the struc-

ture of intermediate inputs into the “machinery and equipment” industry changes (see IOT change2

in gureA2.1). Once the technology is available and installed, it can be used. That is, electricity is

produced with more wind relative to other energy carriers. The most obvious difference in the input

structure of the electricity industry is the reduced use of fossil energy carriers. The change in the com-

position of inputs into electricity production is labelled “IOT change 3” in gure A2.1. If, as in Exiobase,

the electricity industries are already modelled by energy carrier, the switch to more wind electricity is

simply modelled through increased intermediate and nal demand for electricity generated by wind.

Relative to the changes in the input structure of the technology-producing industry (IOT change 2) and

the technology-using industry (IOT change 3), the corresponding emission intensities of these indus-

tries need to be modied (IOT change 4 in gure A2.1). That is, if less coal input is used, the emission

intensity of production of that industry decreases. This is the case for IOTs with only one aggregated

electricity industry, such as the MRIO systems GRAM (Wiebe et al., 2012), the OECD ICIO (Wiebe and

Yamano, 2016) or WIOD (Timmer et al., 2014). If the wind electricity industry is an individual industry

in the input–output table, as in Exiobase (Stadler et al., 2018), a change in the emission coefcient

of the wind industry is not necessary. The emission intensity of total electricity production will change

according to the composition of electricity production.

intensity

Machinery

and equipment

Electricity

Household

expenditure

Government

expenditure

Gross ﬁxed

capital formation

Machinery

and equipment

Electricity

production

VA value added

IOT change 1

IOT change 3

IOT change 4

IOT change 5

IOT change 2

Changes related to technology diffusion in an environmentally extended input–output framework

Figure A 2.1

Note: As described in Wiebe (2018), wind turbines are produced by the “machinery and equipment” (M&E) industry. Thus an

increased diffusion of wind turbines is reected in a change in the investment in M&E (IOT change 1), changing intermediate

input coefcients due to the increased share of wind turbines in the total production of the M&E industry (IOT change 2).

Moreover, as more wind turbines are used for electricity production (Elec), less coal and gas is needed, changing the input

coefcients of the electricity industry (IOT change 3). This in turn reduces the CO

intensity (CO

int) of the electricity industry.

Source: Based on Wiebe, 2018.

168 World Employment and Social Outlook 2018 – Greening with jobs

It should be noted that the focus in Wiebe (2018) is on emissions. However, the extended input–output

methodology is also applicable to any other kind of environmental and socio-economic extensions.

When estimating the impact of other environmental or socio-economic factors, the corresponding

stressors (e.g. the number of employees per unit of output) need to be changed as well. In other words,

if it is assumed that more labour is necessary for the maintenance of renewable energy production

and we model an increased VA share for compensation of employees, it is necessary to consider an

increase in the number of employees or a productivity increase that is reected in increased wages. If

the compensation of employees rises but the number of employees remains the same, employees earn

a higher average wage.

This leads directly to IOT change 5, changes in the value added shares, i.e. taxes and subsidies, com-

pensation of employees and consumption of xed capital. These value added shares may need to be

updated for both the technology-producing industry and the technology-using industry. This is done

using the same approach as updating the intermediate input coefcients:

j,t

= (1 – s

M&E

+ s

WIND

)

for the machinery and equipment industry, where

reects the share of wind turbine production in

total production of the machinery and equipment industry in a given year

In the case described here, neither the technology used nor the technology-producing industries are ex-

plicit for the technology. In other cases, referred to briey above in the case of the electricity industry in

Exiobase, different levels of information are available for the technology-producing and technology-using

industries. To model the changes in the electricity technology-producing industry, input coefcient

vectors for renewable electricity technologies are available from Lehr et al. (2011). For other scenarios

(e.g. organic and conservation agriculture), information is available only for selected input coefcients

(e.g. fertilizer, energy, machinery and employment inputs). In that case, the entire input structure of the

agriculture industries was not changed, but only those coefcients for which information is available.

Naturally, any combination of levels of information on technology production and use can be available.

This description therefore provides some examples of how to deal with levels of information availability.

The transition to a green economy affects several industries at the same time in different ways, in-

cluding changes in individual intermediate input coefcients, capital formation, intermediate and nal

demand, value added shares and emission/employment intensities. When implementing these indi-

vidual changes, it is necessary to bear in mind that the changes need to be consistent. If the use of

fossil fuels as intermediate inputs in an industry is reduced, the corresponding emission coefcient

needs to be reduced as well. If a new technology is used, it needs to be produced (capital needs to be

invested). If one input coefcient of an industry is increased another input coefcient or value added

share needs to be decreased or vice versa, because the sum of input coefcients plus value added

component shares always add up to 1.

Scenario-specic details and assumptions

This section provides details on the specic technological changes and changes to nal demand as-

sociated with each of the six scenarios evaluated in the report.

The transition in the energy sector

This scenario implements the energy pathways laid out by two of the International Energy Agency (IEA)

Energy Technology Perspectives (IEA, 2015): the 2°C scenario and the 6°C scenario. It implements

the IEA scenarios in the MRIO as laid out for each country and industry up to 2030, considering the

changes in electricity generation and heat production, industry, transport and construction. It considers

substitution of fossil fuel-based energy by renewables and improvements in energy efciency. IEA

(2015) provides more details on each of these two pathways. In the 2°C scenario, energy demands

from industry in 2030 fall by 20per cent and the resulting energy needs are met with greater reliance

on biomass and waste, as opposed to electricity or other fossil fuel-based energy sources.

Inherent in this scenario is an advanced switch to electric vehicles and greater energy efciency of

buildings. These changes reect scenarios for green transport and green construction and comple-

ment the transformation of the energy sector with changes in employment resulting from a shift from

internal combustion engines to electric vehicles and the employment demand to increase the energy

efciency of existing buildings. UBS Research (2017) provides projections for the sales of electric

Appendices 169

vehicles and the change in inputs compared to internal combustion vehicles. It also provides details

on the employment and input structure related to efforts to increase the energy efciency of buildings.

Under this scenario, all savings from energy efciency in the IEA 2°C scenario are invested in the

construction sector to retrot buildings and achieve greater efciency.

The 2°C scenario is used as a model for greening the energy sector through changes in electricity

generation, industry energy demand, transport and construction. The 6°C scenario is used as a model

for the business-as-usual scenario in this and all other scenarios discussed in the report.

The transition in agriculture: Organic and conservation agriculture

A comprehensive literature review resulted in 264 coefcients that compare the crop, livestock and

country-specic yields from organic agriculture and conventional agriculture. These coefcients also

include the energy, employment, crop protection, machinery and fertilizer requirements for each mode

of production for each of Exiobase’s agriculture sub-industries (cultivation of rice, wheat, cereals n.e.c.,

oil seeds, sugar cane/beet, plant ber and crops n.e.c.; cattle, pig and poultry farming; meat animals

n.e.c., animal products n.e.c., raw milk and wool/silk production).

The other coefcients are imputed by combining them with World Development Indicators (World

Bank, 2017) for GDP per capita and the share of labour in agriculture and the data of Lowder, Skoet

and Raney (2016) on the average size per farm. A rst round of 50 imputations are applied out for

fertilizers, crop protection and yield. An independent set of 50 imputations are applied for employment,

and another independent set of 50 imputations for energy. Second, all 50 imputations are averaged out

and extreme values are trimmed. The whole table is imputed again 50 times, considering each input

and yield as a categorical variable in the imputation. This imputation is then averaged once again and

extreme values trimmed. Table A2.2 presents the country-to-country averages for each input and agri-

cultural sub-industry. The full table includes specic estimates for each country and region in Exiobase.

The animal products n.e.c. and wool sub-industries could not be imputed due to the complete lack

of coefcients in the literature. The animal products n.e.c. sub-industry is imputed as an average for

the different livestock sub-industries. The wool sub-industry is imputed as the average of all agri-

culture sub-industries.

Synthetic fertilizers and herbicides are substituted by organic alternatives. In Exiobase, these are mod-

elled through animal manure and composting and biotechnology services (research and development).

In addition, a comprehensive literature review resulted in 77 coefcients that compare the crop- and

country-specic yields of conservation agriculture and conventional agriculture. These coefcients also

include the energy, employment, crop protection and fertilizer requirements for each mode of produc-

tion for each of Exiobase’s agriculture crop-based sub-industries (cultivation of rice, wheat, cereals

n.e.c., oil seed, sugar cane/beets, plant ber and crops n.e.c.; cattle, pig and poultry farming; animal

meat n.e.c., animal products n.e.c., raw milk and wool/silk production).

In view of the scarcity of coefcients in the literature, it was not possible to use multiple imputation

reliably to complete the table of coefcients. Nor was it possible to consider reliably estimates by agri-

cultural sub-industry. The average of the coefcients for crops is used for all countries and regions. This

is a tenable assumption, as conservation agriculture is equally cost-effective (from a labour viewpoint,

for example) in developing, emerging and developed countries alike. As conservation agriculture deals

only with crop-based agriculture, coefcients for the cattle, pig and poultry farming, animal meat n.e.c.,

animal products n.e.c., raw milk and wool/silk production industries are set as equal to conventional

agriculture. Table A2.3 presents the coefcients for each input and agricultural sub-industry.

The scenario explores the employment structure of the economy if organic agriculture were to grow to

reach 30per cent of agricultural output in developed (i.e. high-income) countries and if conservation

agriculture were to grow to represent 30per cent of agricultural output in developing (i.e. low- and mid-

dle-income) countries in 2030. FiBL and IFOAM provide the baseline gures for the size of the organic

agriculture sector in each country in 2014 (Willer and Lernoud, 2017). FAOStat provides the baseline

gures for the size of conservation agriculture in each country in 2014 under the indicator “Area of

arable land and permanent crops under protective cover” (FAO, 2017). Each agricultural sub-industry

is assumed to have the same share of organic and conservation agriculture within each country. This

scenario is compared to a business-as-usual scenario dened by the IEA 6°C scenario.

170 World Employment and Social Outlook 2018 – Greening with jobs

The circular economy

This scenario explores the employment impact of a sustained 5per cent annual increase in recycling

rates for plastics, glass, pulp, metals and minerals across countries, replacing the direct extraction of

the primary resources for these products. This scenario also models growth in the service economy

which, through rental and repair services, reduces the ownership and replacement of goods. The

scenario considers a 1per cent annual growth in the services sector, replacing the corresponding

demand for the ownership and replacement of goods. It is compared with a business-as-usual scenario,

as dened by the IEA 6°C scenario.

Input and yield ratios comparing organic and conventional agriculture

Crop protection Employment Energy Fertilizer Machinery Yield

Rice 0.90 1.50 0.35 0.96 0.92 0.84

Wheat 0.86 1.99 0.78 0.90 0.85 0.74

Cereals n.e.c. 0.59 1.04 0.60 0.59 0.67 0.79

Vegetable and fruit 0.61 1.35 1.02 0.57 0.67 0.82

Oil seeds 0.80 1.62 0.26 0.86 0.85 0.81

Sugar 0.78 0.37 0.78 0.82 0.85 0.86

Plant bre 0.62 1.24 0.78 0.59 0.61 0.64

Crops n.e.c. 0.51 1.40 0.79 0.51 0.59 0.69

Cattle 0.67 1.74 0.81 0.67 0.77 0.89

Pig 0.95 1.33 0.74 0.95 0.95 0.95

Poultry 0.82 1.04 0.36 0.82 0.81 0.81

Meat n.e.c. 0.51 0.75 2.11 0.47 0.55 0.70

Animal n.e.c. 0.73 1.22 1.00 0.72 0.77 0.83

Milk 0.69 0.95 0.74 0.65 0.73 0.84

Wool 0.72 1.51 0.78 0.72 0.76 0.81

Notes: Each value denotes the country-to-country average of coefcients used in the scenarios. For example, it shows that, across all

countries and regions in Exiobase, organic agriculture uses 0.90 of the crop protection inputs that conventional agriculture uses. To

compute these averages, each country or region is weighted equally.

Source: ILO calculations based on literature review yielding 264 coefcients.

Table A2.2

Input and yield ratios comparing conservation and conventional agriculture

Crop-based agriculture Animal-based agriculture

Crop protection 1.20 1.00

Employment 0.76 1.00

Energy 0.60 1.00

Fertilizer 1.01 1.00

Yield 1.21 1.00

Notes: Each value denotes the coefcients used in the scenarios. For example, it shows that, across all

countries and regions in Exiobase, conservation agriculture uses 1.20 of the crop protection inputs that

conventional agriculture uses.

Source: ILO calculations based on literature review yielding 77 coefcients.

Table A2.3

Appendices 171

2. THE ECONOMIC DEBATE ON CLIMATE CHANGE:

EMISSIONS, GROWTH AND EMPLOYMENT

This section provides a brief explanation of three key features of the economic debate on climate

change. First, it reviews the range of recommendations for GHG emissions targets and reasons for the

divergence in opinions between economists and climatologists. Second, it critically assesses the core

assumptions underpinning the widely used Integrated Assessment Models, which forecast the costs

of climate change and abatement policy. Third, it discusses proposals for emission-trading schemes

as instruments to implement the GHG emissions reduction targets.

Emissions reduction targets

An appropriate policy response to climate change consists of two steps: rst, identifying a target for

the stock of atmospheric CO

compatible with climate stabilization, and, second, dening the legal

instruments (including incentives, taxes and other regulatory provisions) that will lead to the necessary

reduction in emissions.

The Stern Review (Stern, 2007), which highlights the relevance of GHG concentration targets to eco-

nomic policy discussions, is the best-known example of the rst step. Stern (2007) set the target at

550 ppm CO

eq (a level at which 0.055per cent of the atmosphere would be occupied by CO

) (see

table A2.4). This recommendation attracted criticism from both climatologists and economists. Many

climatologists argued that Stern’s target is too lenient and that 385 ppm CO

eq would be an appro-

priate target. Accordingly, they called for immediate divestment from fossil fuels and for investment in

renewable resources (Hare, 2009; Meinshausen et al., 2009; IPCC, 2014). Some economists, on the

other hand, argued that Stern’s target is too aggressive as its short-term impact would be to destabilize

the global economy. Their consensus target has been much higher, xed at a level of at least 650ppm

eq (Nordhaus, 2007; Dasgupta, 2007). Moreover, they have insisted that this level should be

achieved gradually, as if over a “policy ramp”.

Despite subsequent updates of these studies and of climate change projections (IPCC, 2013), the

terms of the policy discussion have effectively remained unchanged. In fact, while better data can

certainly contribute to improving our understanding of climate change, more recent data do not always

help. In the study of climate processes, high-frequency data can in fact obfuscate long-term trends

(Ackerman, 2017).

The conict among experts’ positions highlights the importance of clarifying subjective judgments

about acceptable risk. As shown in table A2.4, the risks of overshooting the 2°C threshold associated

with each target are very different. According to Hare and Meinshausen (2004) and Meinshausen

(2005), the consensus target for mainstream economists is associated with a risk higher than 90 per

cent of surpassing the 2°C threshold. With the Stern Review’s target, the probability of surpassing the

2°C threshold is still much higher than the probability of remaining below it. As such, the two highest

Differences in GHC emission target between experts

GHG emission target

(ppm CO

eq)

Risk of

exceeding 2°C (%)

Price of carbon

(US$ /t CO

)

Discount rate

(%, annual)

Nordhaus (2008) 650 > 9 0 217 1.5

Stern (2007), IEA (2008),

Markandya (2009)

550 85 420 0.1

IPCC (2007), UNDP (2007) 450 50 623* Multiple

Hansen at al. (2008), Hare (2009),

Meinhausen et al. (2009)

385 20 700 –

* author’s linear extrapolation

Source: Storm, 2017.

Table A2.4

172 World Employment and Social Outlook 2018 – Greening with jobs

proposed targets listed in table A2.4 can be interpreted as “de-stabilization targets”, since both are

likely to create a change in climate, making it permanently unstable.

The more stringent targets proposed by international organizations (IPCC, 2007; UNDP, 2007; IEA,

2008) and by climatologists are associated with higher probabilities that the world’s temperature will

remain under the 2°C threshold rather than exceed it. However, the most stringent target is still associ-

ated with a 20per cent risk of overshooting, far from offering any certainty about the future of climate

stability. A negligible climate risk would require even larger reductions in the stock of GHGs.

The cost of climate change vs the cost of stopping it

Certain economists have proposed the least stringent emission reduction targets because they are

primarily concerned with the consequences of emissions reduction for the economy in the short term.

With no immediate change in prevailing technology, it is argued that reducing emissions may require

slowing down economic growth and job creation. Slower growth and less dynamic labour markets

are in turn likely to exacerbate distributive conicts. However, these effects are largely dependent on

assumptions concerning the level of investments in cleaner energy and the promotion of green jobs.

As argued in Chapter 2, a new, economically viable source of clean energy would break this link, de-

coupling economic growth from GHG emissions. However, developing such technology and scaling it

up for global availability requires investments and risk-bearing beyond the capacity of the corporate

sector alone. In this light, a brief critique of the assumptions underpinning economic modelling of

climate change is set out below.

Common economic analyses take into account the costs of both climate change and mitigation

policy generally in terms of GDP and employment. Since the costs considered occur over a long

period (100years or more) and affect the economy in direct and indirect ways, they are summarized

using models that, based on a series of assumptions, reduce them to comparable quantities. These

“Integrated Assessment Models” (IAMs) are computerized models of the economy that link aggre-

gate economic growth with simplied climate dynamics in an effort to understand and forecast the

impact of GHGs and GHG reduction on growth and employment. The main IAMs are MERGE (Manne,

Mendelsohn and Richels, 1995), PAGE (Hope, 2011), FUND (Anthoff and Toll, 2012) and RICE/DICE

(Nordhaus and Sztorc, 2013).

Recent research has pointed out that IAMs generally include problematic assumptions that in fact

lead them to underestimate both the probability of catastrophic climate change and the costs of asso-

ciated social and economic damage. The key problematic assumptions concern the climate damage

function and climate risk, the anticipated path of economic growth, and the mechanisms of economic

adjustment, generally based on assuming full employment at all times (Ackerman, 2017; Ackerman

and Finlayson, 2006; Mastrandrea, 2010; Weitzman, 2009 and 2013).

For example, the climate damage function incorporated into most IAMs relies on two questionable

claims: rst, that future damages and well-being weigh less than current ones in today’s decisions,

and, second, that the climate-related events that cause the damage follow a regular and predict-

able schedule.

The rst assumption implies that future generations matter less than living generations in today’s deci-

sion-making. This may make sense when modelling small costs expected to occur far into the future,

but it is not appropriate when faced with the possibility of catastrophic climate change. Once a discount

rate is applied, nite costs and incomes that are projected far enough into the future may not affect to-

day’s decisions at all.

However, this is not appropriate for modelling innitely large values in the future,

such as those that would arise from catastrophic climate change, which would disrupt many critical

forms of economic (and human) activity. The present discounted value of such an innitely large loss is

innitely large. However, IAMs only consider the average costs and incomes arising from future events,

thereby disregarding the very high costs of rare events such as natural disasters. In practice, IAMs

input a positive social discount rate, a parameter that reduces the present value of future incomes and

4. Two approaches to discounting are mainly used: a prescriptive approach dening the rates of discount that should be applied,

and a descriptive approach based on the rates that people’s choice of saving and investment reveal. While the former approach

leads to relatively low rates of discount (2–3per cent in real terms) the latter leads to relatively higher rates (at least 6per cent

and, in some cases, much higher rates).

Appendices 173

costs. For example, with an annual discount rate of 1.5per cent, a US$ 1,000 cost incurred 30years

ago is worth less than US$ 650 today. In general, much of the difference between the Stern Review’s

conclusions and those of many economists is due to the choice of a lower discount rate in the former.

Concerning the second assumption, namely that climate-related events follow a regular and predicted

schedule, the implication is that people can make rational decisions based on the observed prob-

abilities of actual events, relying on average costs and incomes. But new thinking in behavioural

economics suggests that this approach to risk is incompatible with actual behaviour. Recent research

demonstrates that more realistic assumptions on risk aversion (assumptions that consider the cost of

rare events, a better balance between immediate costs and future risks and the distraction of short-

term uctuations), which are closer to applications of the precautionary principle, would lead to more

realistic models of climate change (Gerst, Howarth and Borsuk, 2010; Ackerman et al., 2013; Brekke

and Johannson-Stenman, 2008). In other words, a clearer explanation of what is at stake and how real

the danger is would lead people to give a higher priority to climate policy.

These limitations of commonly used models point to the fact that the usual frame of cost–benet ana-

lysis is not an appropriate approach for informing climate policy. First, cost–benet analysis is not suit-

able when human life is at stake in such large numbers, e.g. people at risk of losing their lives because

of climate disasters. In the end, policy formulation must be both economically and ethically sound.

For example, a cost–benet analysis is not permitted in the context of the United States Occupational

Safety and Health Act of 1970, precisely because the cost of regulation should never outweigh the

benets of lives saved. Second, it is not suitable when the costs involved are exceedingly high. In

principle, no matter how high the cost of abatement policy, it makes sense to bear it because once the

climate system is compromised, it cannot be restored. An implicit assumption in cost–benet analysis

is that if the cost of reducing the use of a resource is too high, then the resource ought to be exhausted

rst prior to sourcing an alternative on the market. The problem is that if the “climate resource” is com-

promised then the option of alternative sourcing on the market is not available. Third, the cost–benet

approach is inappropriate because the costs are determined by possible catastrophic events, which

cannot be predicted accurately, and because “there is no single formula for risk aversion that is relevant

for evaluation of policy options across the board” (Ackerman, 2017, p. 138). The overall lesson from the

recent critical analyses is that commonly used IAMs understate the importance of catastrophic climate

events, rendering their results and policy recommendations unreliable.

Carbon markets and other solutions

An obvious solution to climate change, increasingly adopted in cities and individual countries around

the world, is to ban or regulate the activities responsible for it, for example by imposing emission

standards on vehicles and heating systems of buildings, or by phasing out certain types of fossil fuels.

However, the international consensus is largely informed by an alternative economic framework that

seeks to integrate, and thereby diminish, the costs of climate change within a competitive market func-

tion. The framework relies on the idea of “negative externality”, namely that a phenomenon, e.g. climate

change, can be conceived of as a byproduct of some people’s behaviour that affects everyone else.

Because those who emit carbon dioxide share the cost with the rest of the world (while generally appro-

priating all the benets of their activity), they can effectively consider a portion of their resource-related

costs as external to their activities. The recommended solution, therefore, is to force those responsible

for GHG emissions to “internalize” the full cost of their activity by making sure, with taxes or tradable

permits, that they pay the entire social cost of carbon rather than a fraction of it or none at all.

Of the two ways to bring the market price of carbon closer to its social cost, taxes are generally over-

looked both because they are unpopular with inuential constituencies and because they do not offer

any certainty about what level of carbon emissions will be legitimized. Provided carbon taxes are paid,

a company or industry can in principle produce any amount of GHGs. By contrast, a cap-and-trade

system – in which emissions are capped at a given level, the related permit assigned to market par-

ticipants and eventually traded on an established market – provides greater certainty about the level

of emissions produced. Also, a carbon-trading system would normally determine a market price for

5. Beyond the technicalities of economic calculations, discounting raises ethical questions because the future generations whose

well-being is overlooked in today’s decisions are also the least responsible for the climate system and the climate-affected economy

they will operate in. Unsurprisingly, many experts argue for abandoning discounting altogether in the discussions on climate policy

(Arrow, 2007; Ackerman and Stanton, 2008; Weitzman, 2007 and 2009).

174 World Employment and Social Outlook 2018 – Greening with jobs

emissions close to their social cost, creating an incentive for businesses to develop cleaner and neces-

sarily cheaper sources of energy.

In practice, however, things play out differently, as the experiences of the Kyoto Protocol mechanisms

and the European Union Emission Trading System have shown: actual emission trading systems do

not lead to the desired reductions in emissions. Five reasons impair carbon markets’ ability to deliver

the desired outcomes (Storm, 2017):

1. Volatility in carbon markets, in part caused by speculative behaviour, leads to a lock-in of fossil

fuel technology. In fact, for businesses to invest in alternative energy sources, they should expect

a permanently high price of carbon.

2. The required measurement and enforcement apparatus is larger than that required by direct

regulation. This is particularly true for carbon offsets – investments meant to absorb GHGs from

the atmosphere offsetting emissions elsewhere – envisioned by the Kyoto Protocol.

3. Inherent market failures. Carbon markets would likely suffer from information asymmetries and

unenforceable contracts, which would eliminate incentives to invest in alternative energy (Speth,

2008; Stiglitz, 2008).

4. Carbon markets would be efcient only if they determined a universal price for carbon, the same

for all uses in all countries (Stiglitz, 2008). This does not happen in current trading systems, which

create other external costs that contribute to inequalities. For example, the increase in biofuel

production has been linked to increases in food prices (Mitchell, 2008) and the Kyoto Protocol’s

carbon offsets have been linked to land grabs (Lohmann, 2009).

5. To achieve emissions targets, the price of carbon would have to be very high, with likely harmful

consequences on the poorest (Stiglitz, 2008). These could be compensated with appropriate

mechanisms but any such solution would have to be clearly designed preemptively.

A reection of the above difculties is the difference that currently exists between the market price of

carbon (which between 2001 and 2017 remained below US$ 10 per tonne of CO

eq) and the prices

that would be required for emissions to respect the various proposed targets (table A2.4). The least

stringent target would require a price of US$ 217, more than 15 times the market price. The price as-

sociated with climatologists’ more stringent target would be in the order of US$ 700, almost 50 times

the market price (Storm, 2017).

For all these reasons, carbon markets are not likely to function in practice in the way they do in eco-

nomic models. Given the reality of carbon markets and the complications related to their distributive

effects, direct regulation may offer a more effective and administratively simpler alternative. This insight

is picked up in at least two different approaches to economic policy: the Green New Deal and the

“limits to growth” approach.

Proponents of the Green New Deal or “Big Push toward a Zero-Carbon Economy” argue that the cli-

mate change “negative externality” can be more effectively eliminated with a global carbon tax and that

the tax should be accompanied both by appropriate regulation to make sure that emissions targets are

respected and by policies that strengthen social protection systems to correct any negative distributive

consequences of emissions reduction (Grubb, Hourcade and Neuhoff, 2014, Herman, 2015, Pollin

et al., 2014). They also assert, based on recent research on the economics of innovation (Mazzucato,

2013; Mazzucato and Perez, 2014), that enforcing a carbon price close to the real social cost of carbon

is not enough to mobilize the resources necessary to develop alternative energy sources. Since the

risks associated with these investments are too large for the limited appetite for risk of private banks

and businesses, governments would have to step in – using at least the revenues from carbon taxes –

and actively promote the required R&D projects (Storm, 2017). The absence of nancial markets and

a discussion on nancing from IAMs lends support to this view.

The “limits to growth” approach is based on the view that all economies face both ecological and social

limits. Its proponents argue that market and government institutions must be assessed in light of their

ability to support growth paths that do not exceed the carrying capacity of the ecosystems (with their

resource use) or of society (by causing unsustainable inequalities). While this approach is compatible

with all the proposals of the Green New Deal in terms of carbon taxes and innovation nancing, it

differs in that it maintains that formal redistribution systems (such as taxation and social protection

systems) are not always able to redress market inequalities (Klein, 2014; Vira, 2015). Consequently,

institutions should be assessed and possibly amended in order to ensure that they do not produce

unsustainable inequalities.

Appendices 175

3. EMPLOYERS’ ROLE IN THE TRANSITION

The analysis of the role of employers in the transition draws on the Carbon Disclosure Project and

FactSet, two rm-specic data sets.

The Carbon Disclosure Project (CDP) is a voluntary survey in which companies disclose their GHG

emissions and give their opinions and experience on policies and their specic efforts and targets to

mitigate emissions (see, for example, CDP, 2016, which provides descriptive results for the complete

sample). CDP covers rms from the consumer staples, consumer discretionary, energy, nancial, health

care, industrial, IT, materials, telecommunications and utilities sectors. In 2015, a total of 1,997 rms

responded to the questionnaire. In 2010, this gure was 1,799 companies.

CDP questionnaires and data are available through www.cdp.net.

FactSet provides historical nancial information at the rm level, including information on sales and

employment for 2010 and 2015. More information on it is available through www.factset.com.

Size of rms available in FactSet with CDP data

for both 2010 and 2015 (percentages)

Number of employees 2010 2015

0–1,000 4.9 4.0

1,000–10,000 27.0 25.5

10,000–50,000 40.0 41.8

50,000–100,0000 14.2 14.2

More than 100,000 14.0 14.5

Total 100.0 100.0

N 760 760

Notes: Only rms with data in CDP for 2010 and 2015 and with data in FactSet are

considered. Percentages may not add up to 100 due to rounding.

Table A2.5

Regional distribution of rms

in FactSet with CDP data for

both 2010 and 2015 (percentages)

Region Percentage

Africa 4.6

Americas 33.2

Arab States 0.0

Asia and the Pacic 17.0

Europe 45.2

Total 100.0

N 760

Notes: Only firms with data in CDP for 2010

and 2015 and with data in FactSet are consid-

ered. Percentages may not add up to 100 due to

rounding.

Table A2.7

Sectoral distribution of rms in FactSet with CDP data

for both 2010 and 2015 (percentages)

NACE code Sector Percentage

A Agriculture, forestry and shing 0.0

B Mining and quarrying 8.4

C Manufacturing 40.1

D, E Utilities (electricity, gas, steam and air conditioning supply) 6.3

F Construction 4.5

G Wholesale and retail trade, repair of motor vehicles and

motorcycles

4.6

H, J Transport, storage, information and communication 12.8

I Accommodation and food service activities 3.7

K Financial and insurance activities 16.6

L, M, N Real estate, business and administration 2.2

Q Health and social work 0.8

Total 100.0

N 760

Notes: Only rms with data in CDP for 2010 and 2015 and with data in FactSet are considered.

Percentages may not add up to 100 due to rounding.

Table A2.6

FactSet contains information on employment

and sales for 760 of all rms with public CDP

information for 2010 and 2015.

The descriptive analysis of the role of em-

ployers in the transition focuses on these

760 firms with complete information on

employment, sales and GHG emissions.

Tables A2.5 to A2.7 list the characteristics of

these companies by size, sector and region.

176 World Employment and Social Outlook 2018 – Greening with jobs

Appendix 3

LINKS BETWEEN MULTINATIONAL ENVIRONMENTAL AGREEMENTS (MEAs)

AND INTERNATIONAL LABOUR STANDARDS

Year Agreement No.

parties

Relevant treaty provision Relevant ILS No.of ILS

1982 United Nations Convention

on the Law of the Sea,

1982 (UNCLOS)

168 • Obligation to ensure safety at sea with regard to

labour conditions and the training of crews, taking

into account the applicable international instruments

(Article 94).

MLC, 2006; Also C133,

C134, C146, C147,

C163, C164, C165,

C166, C178, C179,

C180, C185, P147,

R48, R49, R75, R78,

R139, R140, R141,

R142, R173, R174.

1992 Convention on the

Protection of the Marine

Environment of the Baltic

Sea Area, 1992

10 • Shipboard working conditions (Annex IV). MLC, 2006; Also C133,

C134, C146, C147,

C163, C164, C165,

C166, C178, C179,

C180, C185.

1994 Convention on Nuclear

Safety, 1994

80 • Protection of workers from radiation exposure, to

be kept “as low as reasonably achievable” and not

exceed prescribed national dose limits (Article 15).

C115, R114, C155,

P155.

1994 United Nations

Convention to Combat

Desertication in those

Countries Experiencing

Serious Drought and/or

Desertication, particularly

in Africa, 1994

197 • Increased income and employment opportunities,

especially for vulnerable members of the community

(Annex I, Article 8).

Core labour standards:

C87, C98, C29, C105,

C138, C182, C100,

C111, C122, C168,

R169.

1995 Agreement for the

Implementation of

the Provisions of the

UNCLOS relating to

the Conservation and

Management of Straddling

Fish Stocks and Highly

Migratory Fish Stocks,

1995

89 • Recognition of special needs of vulnerable groups

in terms of enhancing their income generation and

employment opportunities (access to sheries by

subsistence, small-scale and artisanal shers and

women shworkers) (Article 24).

C111, C122, C168,

C169, R104.