ESG | Green jobs transition leaves older and blue-collar workers behind

Green jobs transition leaves older and blue-collar workers behind

As environmental and social governance continues to gain attention from the workforce, a swift shift to greener jobs is taking place. However, a notable number of older and blue-collar workers are being left on the sidelines, according to recent research findings.

The transition rate from environmentally harmful to clean industries has surged tenfold between 2005 and 2021, with a particular surge in roles related to electric vehicles (EVs), even prior to the $369billion Inflation Reduction Act (IRA) boost for renewable energy and electric cars.

Nonetheless, concerns arise as less than one per cent of workers leaving dirty jobs manage to secure employment in clean or green industries, highlighting potential inequalities in the ongoing green transition.

The study, published in the National Bureau of Economic Research, was conducted by researchers from the University of Pennsylvania who analyzed data from approximately 130million online work profiles, representing about 300million job-to-job transitions.

So-called ‘dirty’ industries encompass activities such as coal, oil, and gas extraction, energy-intensive manufacturing jobs like cement, mining, chemical, and paper and pulp manufacturing.

The study found that older workers (aged 40s, 50s, and 60s) and those without a college education are less likely to transition into green jobs. Green jobs are defined as roles closely associated with renewable energy, such as solar, wind, or EV production.

Currently, the majority of green jobs have been absorbed by white collar workers, such as sales managers, software developers, and marketing managers. A mere 27% of these positions appear to have gone to first-time job seekers, and more than 20,000 jobs were secured by overseas workers.

Although roughly one in five workers transitioned from one dirty job to another, certain cities exhibit alarmingly high shares of dirty-to-dirty transitions, reaching up to 90%. These figures suggest limited attractive alternatives outside of carbon-intensive industries.

Geographical disparities also emerge, with some states such as Louisiana, Delaware, and Texas experiencing over half of all transitions from heavy industry or dirty jobs leading to other dirty jobs.

In contrast, workers in California, Oregon, and Arizona are more likely to shift into EV or clean energy industries, possibly due to a greater concentration of fossil fuel-intensive jobs and better access to educational opportunities and reskilling.

The Inflation Reduction Act (IRA), a cornerstone of President Biden's climate legislation passed a year ago, addresses both EVs and renewable technology.

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Despite facing resistance from Republicans during its passage, the bill's ensuing investment has predominantly benefited GOP-held Congressional districts, fostering battery and electric vehicle plants across states like Georgia, Tennessee, and Texas.

However, criticism has arisen over the IRA's failure to mandate worker protections, as concerns persist that the funding boost may inadvertently deepen existing inequalities.

The authors of the study emphasized the need for ensuring a just transition to a green economy that is geographically, racially, and socially equitable.

While the IRA's impacts remain somewhat unpredictable, it is expected to have a positive effect on the growth of green jobs overall.

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