OVERVIEW Jobs in a Changing Climate Insights from World Bank Group Country Climate and Development Reports covering 93 economies i Overview: Jobs in a Changing Climate © 2025 The World Bank Group 1818 H Street NW, Washington, DC 20433 Telephone: 202-473-1000; Internet: www.worldbank.org This work is a product of the staff of The World Bank Group. “The World Bank Group” refers to the legally separate organizations of the International Bank for Reconstruction and Development (IBRD), the International Development Association (IDA), the International Finance Corporation (IFC), and the Multilateral Investment Guarantee Agency (MIGA). 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All queries on rights and licenses should be addressed to World Bank Publications, The World Bank Group, 1818 H Street NW, Washington, DC 20433, USA; e-mail: pubrights@worldbank.org. Design: Bradley Amburn 1. Introduction Designed to support smart development, the World Bank Group Country Climate and Development Reports (CCDRs) provide a crosscutting look at how countries’ prospects—and the job opportunities they offer their people—can be threatened by climate impacts and supported by climate policies. Prepared by the World Bank, the International Finance Corporation (IFC), and the Multilateral Investment Guarantee Agency (MIGA), each CCDR starts from the country’s development priorities, opportunities, and challenges, and is developed in close consultation with governments, businesses, and civil society, ensuring recommendations reflect national priorities. By combining evidence on adaptation, resilience, and emission pathways, CCDRs highlight where climate action can reinforce development and job creation, and where targeted policies are needed to manage risks and smooth labor market transitions. There are now CCDRs for 93 economies (figure O.1). They cover 64 percent of the population and 77 percent of the gross domestic product (GDP) of low- and middle-income countries (LICs and MICs). In terms of resilience and adaptation, 74 percent of disaster losses in LICs and MICs occur in countries with published CCDRs. And 73 percent of LIC and MIC greenhouse gas (GHG) emissions are generated in CCDR countries. Coverage has also expanded to include three high-income countries (HICs). Figure O.1: Economies included in this CCDR summary report IBRD 49221 | OCTOBER 2025 This map was produced by the Cartography Unit of the World Bank Group. The boundaries, colors, denominations and any other  New economies included in the 2025 summary report information shown on this map do not imply, on the part of the  Economies included in previous summary reports World Bank Group, any judgment on the legal status of any territory, or any endorsement or acceptance of such boundaries. CCDRs continue to expand their reach, seen in both downloads and media coverage. Since the first CCDR (Türkiye, in June 2022), there have been more than 836,000 downloads (as of September 25, 2025) and more than 12,500 media articles covering CCDRs, with 56 percent discussing findings related to jobs. This suggests CCDRs are increasingly framed not only as climate and development studies, but also as contributions to wider debates on economic opportunity and jobs. This is the fourth CCDR summary report, complementing the first three summaries,1 and consolidating key findings. The first summary reports laid the foundation by showing how climate and development goals can be pursued together and focused on: infrastructure and macroeconomic effects (2022); 1 The 2022 CCDR summary report “Climate and Development: An Agenda for Action”, the 2023 CCDR summary report “The Development, Climate, and Nature Crisis: Solutions to End Poverty on a Livable Planet”, and the 2024 CCDR summary report “People in a Changing Climate: From Vulnerability to Action” are available here: https://www.worldbank.org/en/publication/country-climate-development-reports. 1 Overview: Jobs in a Changing Climate forests, land use, and the private sector (2023); and people (2024). This report expands the analyses presented in the previous summary reports and focuses on findings related to jobs—consistent with the World Bank Group’s Development Committee papers, “Jobs: The Path to Prosperity”2 and “Foundations for Growth and Jobs”,3 which advance a One World Bank Group approach to putting jobs at the center of development efforts. 2. Reducing risks and unlocking benefits through smart development Climate change is a threat to people and firms Climate change impacts are felt today and foreshadow a more challenging future. Agriculture—the backbone of livelihoods in countries like Uganda, Sierra Leone, and Togo—is already under strain. Paraguay, an agricultural powerhouse, has faced recurring droughts, sending shocks across its entire economy. Disruptions extend beyond agriculture, undermining the critical infrastructure—notably transport, energy, water, and digital networks—that modern economies depend on. Ecuador’s reliance on hydropower transformed the 2024 drought into an energy crisis, with power blackouts of up to 14 hours a day for four months. Climate change and extreme weather events are already imposing direct and escalating costs on private firms, undermining productivity, business continuity, and supply chains. The adverse impact of unusually high precipitation between 2015 and 2024 led to a 1.7 percent ($7 billion) loss in Malaysia’s GDP, with startups and small and medium-sized enterprises experiencing revenue and productivity declines up to eight times higher than those of larger firms. Smaller firms typically lack the financial resources, technical expertise, and access to credit needed for resilience investments. Many CCDRs underscore the substantial risks from nature loss and degradation. Renewable natural capital represents over 30 percent of total wealth in LICs and lower middle-income countries and the loss of natural forests already costs the world $379 billion a year—about 8 percent of global agricultural GDP.4 The Indonesia CCDR highlights the health damages from smoke associated with forest clearing for agriculture, which were estimated to cost $23.5 billion from 2008 to 2017. In Malawi, land degradation could increase infrastructure damage by as much as 25 percent by 2050. At the same time, CCDRs point to opportunities from nature-based action. In the Democratic Republic of Congo, every $1 invested today in landscape and forest restoration can generate $15 in benefits by 2050. Even with partial inclusion of climate change impacts into models, climate change is expected to lead to significant economic losses of 1–20 percent of GDP by 2050. The CCDRs apply a modeling framework that links climate, biophysical, and macroeconomic models to quantify economic losses. This approach covers some of the largest expected impacts but leaves important risks unquantified, including impacts through violence and conflicts, rapid ecosystem shifts, unmanaged migrations or cascading impacts from disasters. Even with this limited scope, expected losses are significant (figure O.2), and higher in lower-income and hotter countries. Average impacts on GDP mask vulnerabilities to single events, and some CCDRs are applying a complementary “stress test” approach. For example, the Mongolia CCDR includes a “plausible worst-case scenario” in which multiple shocks occur at the same time, leading to GDP losses of 20 percent and 14 percent of people becoming unemployed. 2 Development Committee. 2025. “Jobs: The Path to Prosperity.” Prepared for the April 24 Development Committee Meeting. 3 Development Committee. 2025. “Foundations for Growth and Jobs.” Prepared for the October 16 Development Committee Meeting. 4 Damania, R, Ebadi, E, Mayr, K, Russ, J and Zaveri, E. 2025. Reboot Development: The Economics of a Livable Planet. World Bank. 2 Overview: Jobs in a Changing Climate Figure O.2: Estimated impact of a pessimistic climate scenario on GDP by 2050, by region Eastern & Southern Africa Western & Central Africa East Asia & Pacific Europe & Central Asia Latin America & Caribbean Middle East, North Africa, Afghanistan, and Pakistan South Asia -20 -18 -16 -14 -12 -10 -8 -6 -4 -2 0 Change in GDP (%) Note: The colored bars indicate the interquartile range, with light and dark blue divided at the median, and whiskers represent minimum and maximum values. The figure shows the impact of a scenario with climate change compared to a baseline scenario without climate change. Both scenarios are with current policies. See the full report for individual country results. Climate change impacts are not evenly distributed, and the human consequences will fall hardest on the poorest communities who have done the least to cause the problem. Cases from Bhutan to Cabo Verde find positive correlations between current poverty and future climate change hazards. The Sierra Leone and Madagascar CCDRs suggest that climate shocks could push an additional 3 and 3.4 percent of their population (500,000 and 1.7 million people) into poverty by 2050. Climate change will also deepen poverty beyond what the models can currently capture, including through fragility and ecosystem impacts. In Somalia and South Sudan, climate change has acted as a threat multiplier, increasing conflict over scarce resources, such as water and grazing land. Adaptation is an immediate and high-return investment opportunity Investments in adaptation deliver measurable economic benefits by reducing climate-induced losses and creating economic gains. Across CCDRs, projected GDP losses can be reduced by 4.2 percentage points, on average, thanks to proactive adaptation efforts (figure O.3). In Benin, Dominican Republic, and Grenada, negative impacts on GDP can be more than halved by mid-century. In some countries— such as Peru, St. Lucia, and Uganda—adaptation can even lead to net gains, showing that resilient development can be a powerful driver of sustained and job-generating growth. Assessments also show that, while adaptation and resilience readiness is improving and correlates with per capita GDP, it varies between countries at similar income levels, suggesting that policy choices are crucial. Figure O.3: Estimated benefits from adaptation interventions recommended in CCDRs by 2050, by income group High-income +0.7 Upper-middle-income +2.5 Low er-middle-income +3.0 Low -income +5.0 -11 -10 -9 -8 -7 -6 -5 -4 -3 -2 -1 0 Median percent age change in real GDP compared t o 2050 baseline 3 Overview: Jobs in a Changing Climate CCDRs also highlight the limits to adaptation action, and the reduction in climate change impacts in scenarios with lower global GHG emissions. Even very ambitious action on adaptation would not be able to cancel all climate impacts, including key impacts on the poorest and most vulnerable. However, the economic and poverty impacts of climate change are reduced in scenarios with lower global GHG emissions, highlighting the global public goods nature of the climate change challenge. Low-emission pathways reduce climate risks and create new economic opportunities The benefits of low-emission development extend beyond climate commitments and long-term avoided climate change impacts to include tangible short- and longer-term economic benefits. CCDRs analyze low-emission development pathways, building on countries’ own climate targets or commitments, or using illustrative pathways to inform decision-making. These pathways are not prescriptive; rather, they are used to assess the costs and benefits of different policy choices. Altogether, low-emission development pathways in CCDRs reduce countries’ emissions by 71 percent compared with current levels. Low-emission pathways place the energy sector, electrification of end uses, and renewable power at the center of the transformation. Most CCDRs include power sector planning and consider a full range of available technologies, from renewables to fossil fuels, nuclear, battery and pumped-hydro storage, and grid upgrades. All pathways involve a rapid scale-up of renewable energy—primarily solar and wind— coupled with a phase-down of fossil fuels, a shift driven by favorable economics. For example, a more rapid scale-up of solar and wind power in Cambodia, along with greater hydropower imports from Lao People’s Democratic Republic (Lao PDR), could deliver lower electricity prices and lower air pollution. For small island and coastal states like Cabo Verde and Comoros, the transition to renewables is a direct path to greater energy security, fiscal stability, and a reduced national import bill. In Senegal, the transition away from heavy fuel oil generation to renewables and domestic gas is the most cost- effective strategy, lowering electricity costs and reducing exposure to global fuel price volatility. Beyond the power sector, other shifts with large development gains include electric mobility and railways in Georgia, protecting forests, mangroves, and other vital ecosystems in Lao PDR, Paraguay, Gabon, and Guinea-Bissau, improved livestock feed systems in Uganda, and bus rapid transit in Pakistan. For resource-rich nations like Zambia and Guinea, benefits include revenues from green minerals. And across global value chains for key green technologies, LICs and MICs have comparative advantages in both production and innovation that can be unlocked.5 Climate policies can also help attract foreign direct investment, a factor of technological upgrading and job creation. Thanks to their co-benefits, low-emission pathways can often deliver neutral or positive impacts on GDP (figure O.4), even in the short run. Macroeconomic implications depend on the balance between higher investment costs and benefits from higher energy efficiency, reduced fossil fuels consumption and imports, and co-benefits from reduced congestion and air pollution. Potential benefits are higher in lower-income countries and many countries—including Lao PDR, Sri Lanka, and the Kyrgyz Republic— report positive short-term GDP growth impacts. In some countries, such as Uzbekistan and Tajikistan, however, the removal of large and unsustainable fossil fuel subsidies leads to short-term losses, with gains materializing over the longer term. In general, long-term impacts of low-emission development are more uncertain but expected to be positive, even without considering avoided climate change impacts. 5 Rosenow, S and Mealy, P. 2024. Turning Risks into Rewards: Diversifying the Global Value Chains of Decarbonization Technologies; IFC. 2025. Innovation in Green Technologies. 4 Overview: Jobs in a Changing Climate Figure O.4: Estimated impact of a low-emission development pathway on GDP by 2030, by income group and by region Low-income Lower-middle income Upper-middle income High-income -1.5 -1.0 -0.5 0.0 0.5 1.0 1.5 2.0 2.5 3.0 3.5 Change in GDP (%) Eastern & Southern Africa Western & Central Africa East Asia & Pacific Europe & Central Asia Latin America & Caribbean Middle East, North Africa, Afghanistan, & Pakistan South Asia -1.5 -1.0 -0.5 0.0 0.5 1.0 1.5 2.0 2.5 3.0 3.5 Change in GDP (%) Note: The colored bars indicate the interquartile range, with light and dark blue divided at the median, and whiskers represent minimum and maximum values. The figure shows the impact of a low-emission development scenario compared to a baseline scenario with current policies. See the full report for individual country results. Financing smart development requires joint action from governments, international partners, and the private sector Smart development requires sizable investments in long-term growth (figure O.5). This includes spending to expand access to energy, water, and infrastructure in ways that are resilient, sustainable, and supportive of a dynamic and growing labor market. Such investments cannot be considered as pure climate investments, since they include development spending. The magnitude of these investments also varies, reflecting both country-specific vulnerabilities and scenarios design. For example, the Sahel CCDR contrasts the full investment needs, estimated at 8 percent of GDP per year, with a more conservative scenario focusing on the most urgent and important needs, which require annual investments of around 1.8 percent of GDP. The private sector will play a key role in all countries and sectors. Mobilizing resources requires governments to blend public and private finance, with different sectors demanding distinct financing models and risk-sharing arrangements. Public resources remain essential in many sectors, including to support adaptation of the poorest and most vulnerable, and will require enhanced domestic resources mobilization and higher efficiency of spending with improved tax systems, budget planning tools, and expenditure frameworks that consider climate risks. But CCDRs also identify opportunities for the private sector to invest, especially in key sectors like climate-positive agriculture and agribusiness, sustainable forest management, renewable power generation, and nature-based tourism. Industry investments are also expected to be largely financed by the private sector, while water or flood prevention infrastructure will rely more on public resources. Power and transport fall in between, though the balance varies across countries. The challenge is harder in LICs, which have larger needs for resilience, water, and human development, increasing fiscal strain and making international support essential. For example, in Djibouti or small island states, the private sector has played a limited role to date due to high operational costs, limited access to finance, and a weak investment climate. 5 Overview: Jobs in a Changing Climate Figure O.5: Increase in annual investment by 2030 in CCDR countries’ resilient low-emission pathways 11 Invest ment t y pe Low-emission development 10 Pakistan Resilient development Both 9 Cameroon 8 Sahel Malaysia 7 Cabo Verde Ecuador Investments (% of GDP) 6 Togo Viet Nam Moldova 5 Dominica Lao PDR South Africa Dominican Republic 4 Egypt, Arab Rep. Senegal Peru Tunisia Iraq St. Vincent and the Grenadines 3 Kyrgyz Republic Thailand Tajikistan Morocco Argentina Djibouti North Macedonia Maldives St. Lucia 2 Sri Lanka Kosovo Yemen, Rep. Ghana Colombia Serbia Mongolia Bosnia and Herzegovina Uganda Philippines Azerbaijan Albania Kazakhstan 1 Kenya Cambodia Côte d’Ivoire Botswana Montenegro Croatia Somalia Armenia China Türkiye Jordan Brazil Paraguay 0 Romania Poland Tanzania Sierra Leone Uzbekistan Gabon 0 2 4 6 8 10 12 14 16 18 20 22 24 26 GDP per capita in 2024 ($000) There is a growing toolbox for financing resilient low-emission development. Mobilizing private capital starts with a supportive, stable, and predictable policy environment, which allows people and firms to make long-term investments, and clear incentives and coordination frameworks to ensure alignment with long-term objectives. Then, targeted solutions include developing thematic bond markets (Thailand), expanding green finance markets (Uganda), enhancing financial sector regulators’ capacity to assess climate risks in the finance sector (Colombia), and developing a sustainable finance roadmap for the financial sector (Türkiye). Other solutions include developing climate-related supervisory guidelines, disclosure and reporting regulations for green or sustainable finance (including through taxonomies), and integrating green finance into the financial inclusion agenda. But underdeveloped domestic financial systems can be an obstacle, as seen in Comoros, Bhutan, and Sri Lanka. CCDRs, including in Poland, Croatia, and Caribbean countries, discuss public-private partnerships (PPPs) alongside other instruments—such as guarantees, grants, and concessional finance—as options for crowding in private investment, particularly when supported by public or multilateral derisking instruments. The Uganda CCDR, for example, cites the Uganda Agriculture Insurance Scheme—a PPP that provides coverage to over 650,000 farmers, 90 percent of them smallholders. CCDRs highlight as a priority the development of disaster risk finance and insurance solutions, as well as financial inclusion and access to insurance. Beyond delivering financing for climate action, carbon markets also support development. While voluntary transactions currently dominate, intergovernmental exchanges under Article 6 of the Paris Agreement are also advancing. These tools can improve the affordability or viability of actions such as energy access, clean cooking, and afforestation. Several countries—including Uganda, Paraguay, Bhutan, and Thailand—are positioning themselves to participate in international carbon markets, but for others, institutional capacity constraints could limit or delay participation. Many countries, such as Comoros, Togo, and Cabo Verde, are yet to develop a policy or regulatory basis for participation in markets. 6 Overview: Jobs in a Changing Climate 3. Climate and development goals need the same thing: A workforce and jobs that can adjust and adapt to change Climate change and climate action are reshaping labor markets, but their effects are not independent of other major trends. Over the next decade, an estimated 1.2 billion young people will reach working age in developing countries, intensifying the need to create jobs, especially in Africa. Meanwhile, labor availability is tightening in other areas, as populations shrink across the Europe and Central Asia region and in parts of East Asia and the Pacific. At the same time, technological advancements, including electrification, digitalization, and artificial intelligence, are transforming the nature of work. The combined impact of climate change, climate action, and these concurrent trends require complex reallocations of workers across sectors and occupations. Most CCDRs analyze labor market effects through a comprehensive lens, moving beyond the traditional green versus brown jobs dichotomy to capture the full spectrum of impacts , identifying “job-at-risk” and “job-in-demand”. To understand these multifaceted and interconnected effects, CCDRs typically rely on macroeconomic modeling, which captures not only direct employment changes but also often much larger indirect and induced impacts. Given that the challenge extends far beyond shifting workers from brown to green occupations—a shift that is often infeasible due to mismatches in skills, wages, and locations—countries need to enable a broader labor market reshuffle. Climate risks have widespread impacts on jobs, but adaptation can reduce the effects Climate risks affect jobs and livelihoods, with large economic impacts, particularly in lower-income countries. CCDRs provide evidence of climate change influencing jobs through multiple channels, including direct impacts on workers through adverse health effects from increased disease prevalence, learning losses due to disruptions in education, and productivity declines from time lost due to transport disruptions, and indirect effects on labor demand due to shifting consumption patterns and damage to physical and natural capital. Modeled estimates of some of the key channels indicate substantial losses, with labor income estimated to decline by 7.9 percent, on average, by 2050 in a pessimistic climate scenario, and as much as 8.7 percent in LICs (figure O.6). These aggregate effects on labor income can hide substantial shifts, particularly in the agriculture sector. Adaptation interventions can generate the equivalent of 25 million “more and better-paid jobs” across 49 CCDR countries, or 149 million jobs when extrapolated to all LICs and MICs. In modeled countries, adaptation interventions can reduce labor income losses, on average, by 4.2 percentage points (figure O.6). Gains are found to be larger in the most vulnerable countries, estimated at 5.2 percentage points in LICs compared with 4.7 percentage points in upper-middle-income countries and 1.0 percentage point in HICs. Using the proposed World Bank Group scorecard indicator “more and better-paid jobs”, climate change is estimated to result in the equivalent of 43 million job losses by 2050 across 49 CCDR countries, or 260 million when extrapolated to all LICs and MICs.6 With adaptation interventions, these losses are reduced to the equivalent of 18 million jobs in analyzed countries, or 111 million in all LICs and MICs. 6 The World Bank Group scorecard indicator “more and better-paid jobs” reflects changes in labor income (expressed in monetary terms), normalized by the baseline wage to represent changes in labor income in terms of a number of baseline-equivalent jobs. This analysis has been done only in a subset of CCDRs (49 out of 93). 7 Overview: Jobs in a Changing Climate Figure O.6: Average impact of a pessimistic climate scenario on labor income by 2050, with and without adaptation interventions recommended in CCDRs High-income +0.7 Upper-middle income +4.7 Lower-middle income +3.2 Low-income +5.2 Overall +4.2 -9 -8 -7 -6 -5 -4 -3 -2 -1 0 Percentage change in labor income Low-emission development creates new employment opportunities and risks Low-emission development pathways present a mix of opportunities and risks for employment across sectors in the context of rapidly changing labor markets. Current trends in technology, consumer demands, and international policies—which are beyond the control of individual countries— will unavoidably displace a subset of existing occupations and workers. In many CCDR countries, the baseline development scenario already includes increasing job losses in vulnerable sectors, which would need to be managed regardless of governments’ climate policy choices. The direct effect of climate policies on jobs is expected to be neutral or net positive. The International Labour Organization, International Energy Agency, and InterAmerican Development Bank find that a green transition would lead to an increase in aggregate employment. CCDRs also highlight potential gains, but also employment losses. For example, Tajikistan’s rooftop solar policy could boost total employment by 2–3 percent through 2030, while the Western Balkans could experience a 20 percent decline in mining employment. Some employment losses stem not from climate policies but from broader economic shifts—such as the declining costs of renewable energy that make coal less competitive. In aggregate, policies implemented in a low-emission development pathway increase labor demand in many CCDR countries. However, the extent to which this translates into actual employment depends on complex labor market dynamics and accompanying policy measures. Modeling suggests that the shift to low-emission development pathways would have modest effects on aggregate employment. Aggregated over 33 countries covered by CCDRs, the shift to low-emission development results in a small decline equivalent to 0.7 million more and better-paid jobs by 2030 (using the World Bank Group scorecard indicator).7 Country-level results are mixed, with positive and negative results depending on country contexts and the policy designs considered in the modeling (figure O.7). In Mali, the modeled low-emission development pathway is estimated to increase labor income by 1.7 percent, translating into 180,000 more and better-paid jobs by 2030. Similar positive effects are projected for Poland, Argentina, Iraq, and Tunisia. But in other countries, such as Uzbekistan, the low-emission scenarios are associated with significant declines in labor income, due to the removal of large and unsustainable fossil fuel subsidies. These findings underscore the importance of complementing subsidy reforms with robust social protection and transition policies. Aggregate employment effects mask significant sectoral shifts and regional or gender differences. For example, in Armenia, the low-emission pathway accelerates the movement of jobs away from agriculture, while the Philippines and Indonesia CCDRs project improved agriculture productivity, resulting in a modest increase in employment in the sector. The Indonesia CCDR suggests that men 7 When extrapolated to all LICs and MICs, this is equivalent to 2.6 million jobs lost by 2030. 8 Overview: Jobs in a Changing Climate could be more strongly affected than women, while in Morocco, where women and youth face persistent barriers to accessing new job opportunities, the opposite could be true. For energy-intensive economies that transition to low-carbon alternatives, small impacts at national level can occur in parallel with large local-level job losses. For example, coal-related jobs in Poland are highly concentrated and can represent up to 50 percent of total employment in some municipalities. Figure O.7: Estimated impact of a low-emission development pathway on labor income by 2030, by income group Low-income Lower-middle income Upper-middle income High-income -3 -2 -1 0 1 2 3 Change in labor income (%) Note: The colored bars indicate the interquartile range, with light and dark blue divided at the median, and whiskers represent minimum and maximum values. The figure shows the impact of a low-emission development scenario compared to a baseline scenario with current policies. Both scenarios are without complementary labor market policies. See the full report for individual country results. Government policies can enhance the job outcomes of smart development CCDRs identify opportunities and risks in labor markets, and the need for significant adjustments for workers already exposed to technological, demographic, and economic changes. To maximize employment in the context of climate change, the CCDRs identify three priorities. Enable private-sector job creation The Development Committee papers, “Jobs: The Path to Prosperity” and “The Foundations of Jobs and Growth”, provide a useful lens for identifying priority actions to protect jobs against climate change and enhance job outcomes from climate action. They identify three pillars: (1) Investing in human capital, physical infrastructure, and natural resources; (2) Putting in place business-enabling policies and a predictable regulatory environment; and (3) Mobilizing private capital. CCDRs provide recommendations on these three core pillars, showing the overlap between actions to maximize job creation and actions to make development more resilient and less emissions intensive. CCDRs also identify actions relevant to the five key sectors identified in the Development Committee papers: agribusiness, energy and infrastructure, health care, value-added manufacturing, and tourism. CCDR policy recommendations for the first pillar emphasize the importance of establishing the necessary preconditions for jobs, with a particular focus on investing in human, physical, and natural capital. Human capital plays a key role: the Egypt CCDR emphasizes that equipping the workforce with appropriate skills is essential for implementing decarbonization across sectors. Access to affordable, reliable, and resilient infrastructure services is necessary for economic growth and job creation. The Dominican Republic CCDR underscores the productivity benefits of climate-resilient infrastructure, projecting that expanding air-conditioning coverage to 60 percent by 2050 would raise labor productivity by at least 5 percent. With around 40 percent of the global workforce depending on industries that are directly tied to natural resources and ecosystem services, CCDR recommendations also include natural capital and investment in natural resources and ecosystem services. In Bhutan, a green transition would benefit the tourism sector, which generates nearly one-fifth of all jobs in the country. 9 Overview: Jobs in a Changing Climate Recommendations for the second and third pillars center on improving the business environment by providing greater policy and regulatory certainty—which reduces investment risks and allows firms to innovate, enabling them to create more and better jobs—and mobilizing private capital to fuel job creation. CCDRs discuss the importance of a stable macroeconomic framework to mobilize private capital and attract investors, with many synergies when subsidy reforms or carbon pricing contributes to fiscal consolidation (Pakistan, Morocco), when reductions in imports of expensive fossil fuels protect from price volatility (Dominican Republic, Viet Nam), or when resilient agriculture reduces food price inflation (Iraq, Armenia). Policy and regulatory certainty is also essential when designing climate policies, with long-term strategies and appropriate climate-related legal frameworks offering an opportunity to balance the predictability needed for the private sector to invest with the flexibility needed to adjust to unforeseen events or technology development. Smart development also requires increased investments, which in turn, require stronger local capital markets and financial sectors, and innovative financial instruments—such as guarantees, blended finance, and risk-sharing mechanisms—to attract private sector actors. Facilitate the reallocation of workers in changing labor markets Even with large job creation, complementary policies are crucial to ensure workers can capture these opportunities. As highlighted by the framework in table O.1, workers face barriers related to what they do, where they are, when they are available, who they are, and why they work. These mismatches—in skills, space, timing, norms, and preferences (including wages)—are a normal feature of dynamic labor markets and may self-correct over time as workers and firms adjust. But when adjustment is hampered by market failures (such as information asymmetries) or other barriers (such as transaction costs), these mismatches can become binding frictions that constrain worker mobility and prevent new jobs from being filled, while leaving displaced workers behind. Table O.1: “Five Frictions”: a framework for identifying labor market frictions in the green transition Friction Labor demand Labor supply Mismatch CCDR examples What » What skills are needed to » What skills are available in Skill In Namibia, only 6 out of 63 occupations deliver the green transition? the workforce? related to the green hydrogen industry are » What skills are likely to be sought by unemployed workers, indicating a displaced? significant skills gap. The CCDR recommends better aligning tertiary education with industry needs. Where » Where are jobs created » Where are workers and Spatial In Brazil, 88% of formal job switches occur or lost and what is the skills located? within the same state, suggesting that the spatial distribution of the geographic distance between in-demand jobs skill requirements and and at-risk jobs could be a significant barrier availability? to workforce mobility. The CCDR recommends regional development strategies to support areas with high concentrations of at-risk jobs. When » When and for how long are » When (or how quickly) Temporal Tajikistan will need 65,000 temporary workers workers and skills needed, can workers and skills be for rooftop solar installations, creating a and how fast are they being mobilized? challenge as labor demand tapers off, with displaced? risk of workforce oversupply. The CCDR recommends policies that support reskilling, training, and lifelong learning for workers as demand changes. Who » Who is affected by » Who makes up the Norm Only 3% of workers entering male-dominated employer biases? workforce? occupations in Georgia are women, and 7% » Who is impacted by self- entering female-dominated roles are men, bias? indicating strong barriers to gender mobility across occupations. The CCDR recommends interventions to promote equal access to education and training opportunities for all genders. Why » What job attributes do » Why do people work (how Preferences In Malaysia, workers shifting from oil and gas employers offer? do workers prioritize job (including occupations to in-demand roles with similar attributes)? wages) skills face wage reductions of 20–70%. The CCDR recommends a strategic response to manage income losses for displaced workers. Source: Knudsen, C, Moura, F S de; Bucker, J J J H and Mealy, P A. 2025. Five Frictions: Key Labor Market Barriers to Unlocking Job Growth in the Green Transition. Washington DC: World Bank Group. 10 Overview: Jobs in a Changing Climate Many CCDRs discuss the importance of active labor market policies in facilitating adjustment in the face of shifting demand. As discussed in the Brazil CCDR, the success of such policies often varies by target group, program design, and the extent to which they address the binding constraints workers face. In Türkiye, programs have increasingly focused on equipping workers—particularly youth—with the technical skills they need for employment in emerging green industries. And as highlighted in the Egypt, Moldova, and Indonesia CCDRs, developing labor market information systems can inform skill demand and the required competencies for different roles. The Brazil, South Africa, and Georgia CCDRs also demonstrate the importance of regulatory reforms in labor markets and how recognizing new qualifications can help improve successful workforce reallocation. Skill strategies can be designed to promote inclusion and provide opportunities for the most vulnerable. For example, the Nepal CCDR emphasizes targeted training for vulnerable groups, such as solar panel maintenance and climate-smart agriculture training with microenterprise development for rural women. CCDRs also highlight the need for educational reform where school curriculums and vocational training systems are outdated or misaligned with fast-changing labor market needs and stress the importance of creating stronger feedback loops between training and skill development programs and the private sector. For example, the Bangladesh CCDR calls for updating competency standards and curriculums for climate transitions, workplace-based upskilling, and gender-focused programs in science, technology, engineering, and mathematics and well as technical and vocational education and training, while the Uganda CCDR advocates for working with the private sector to scale up skills and education. CCDRs also discuss policies that respond to other barriers to worker mobility. The Poland CCDR notes that mine and power plant workers and those living in the most affected nearby municipalities have expressed strong reluctance to move to other cities or take a job with a long commute. The South Africa CCDR also draws attention to norm-based barriers faced by informal women workers in the coal sector value chain, typically in small service sector firms that rely indirectly on the coal industry: they do not have access to formal labor protections such as severance benefits and may require targeted transition measures. Protect the most vulnerable displaced workers and communities Social protection provides crucial income support for poor and vulnerable households whose livelihoods are affected by climate change or climate policies, preventing deeper poverty and protecting human capital. Despite progress in coverage and targeting, many social protection programs only reach a fraction of the people who need it. The Kenya CCDR illustrates how adaptive social protection can respond to climate risks, as the country’s Hunger Safety Net Programme delivers regular cash transfers in arid regions and scales up support during droughts through early warning triggers, mitigating food insecurity and protecting household welfare. Many countries are shifting from protective safety nets to productive inclusion approaches that aim to improve marginal livelihoods, build resilience, and promote economic self-sufficiency among poor and vulnerable populations. In countries where certain sectors or regions are especially vulnerable, sector-targeted or place-based policies may be needed to facilitate adjustment to climate-related challenges. In regions that depend heavily on coal or fossil fuels, resilient, low-emission transitions require proactive government action to foster new sources of growth. 11 Overview: Jobs in a Changing Climate 4. Conclusion This fourth CCDR summary report complements the previous summaries and confirms many of their main findings by building on the larger number of countries covered. While findings underscore the profound impact of climate change on global development and employment, they also emphasize the potential job protection and creation from investing in resilience and adaptation. And they show that the transition to a low-emission economy does not need to be undertaken at the expense of economic growth or job creation. While climate action may lead to job displacement, it also creates new employment opportunities in green industries, and resilience interventions will protect workers and livelihoods that are at risk from climate impacts. Most CCDRs recommend targeted policies to support workforce transitions, including investments in reskilling, education, and health, and more generally, reforms to make labor markets and safety nets function more efficiently. Beyond the climate agenda, such reforms are also enhancing the ability of labor markets to adjust to constant demographic, technological, and economic changes and can thus contribute to full employment and accelerated growth and poverty reduction. Ultimately, these recommendations should serve as a tool for governments, private sector actors, and stakeholders seeking to operationalize a development agenda that is both climate smart and centered on improving livelihoods for all. 12 Overview: Jobs in a Changing Climate 13 Overview: Jobs in a Changing Climate