A Global and Inclusive Just Labor Transition: Challenges and Opportunities in Developing and Developed Countries

Abstract

This research identifies challenges and opportunities for achieving an inclusive just transition to a low-carbon economy in the labor market, a just labor transition (JLT). We conduct a comparative analysis of JLT policies between developed and developing countries. These countries face common challenges in achieving a JLT to ensure quality jobs, compensation for displaced workers, and the need for governmental intervention. In assessing developing countries, we recognize the heterogeneity among these countries, so we focus on a sample that allows us to characterize the labor market within the transitioning sectors. We identify both challenges and potential avenues for creating new employment opportunities, facilitating skill retraining, and ensuring the integration of communities within a JLT. Many of these countries are in the initial phases of a just energy transition, and notably, we also explore the nascent just energy transition partnership efforts. Further, we describe the opportunities and lessons drawn from advanced economies' experiences and the recent efforts of developing countries that could help achieve a global and inclusive JLT. These findings demonstrate some key steps many countries can take towards beginning and achieving their JLT destination. Finally, we construct and present a Just Labor Transition Progress Scale, which measures where countries are in terms of their progress in policy and impact within their job markets. This tool will be particularly useful for research and policy-making practitioners.

Keywords: Just Transition, Just Labor Transition, Labor Markets, Climate Policies, Environmental Regulation, Energy Transition

JEL Classification: J24, Q58, H23