Publication:
Heading Towards 1.5ÂșC - Impacts on Labor Demand in Selected Countries

Loading...
Thumbnail Image
Files in English
English PDF (2.49 MB)
256 downloads
English Text (104.62 KB)
34 downloads
Published
2024-03-12
ISSN
Date
2024-03-12
Editor(s)
Abstract
The United Nations Climate Change Conference (COP28) closed with a statement signaling the beginning of the end of the fossil fuel era, a just and equitable transition, deep emissions cuts, and scaled-up finance. Decarbonization and green transition more broadly are recognized as essential to green recovery and will inevitably be implemented, but governments struggle with the how and when and how to pay for policy questions. Often, the green transition is seen more as a challenge than an opportunity for development. One policy instrument to move to a low-carbon pathway is a carbon tax, which would disincentivize carbon-intensive activities, and the revenues generated could be recycled to finance climate actions. When climate actions, such as renewable energy investments and energy efficiency programs, are designed in a way that stimulates job creation, a double dividend can be achieved: lower emissions and more jobs. The paper assesses different policy designs around a carbon tax regime and shows simulation results for direct and indirect implications for jobs using the MINDSET model, a price endogenous MRIO hosted by the World Bank.
Link to Data Set
Citation
“Lehr, Ulrike; Pollitt, Hector. 2024. Heading Towards 1.5ÂșC - Impacts on Labor Demand in Selected Countries. Jobs Working Paper; Issue No.79. © World Bank. http://hdl.handle.net/10986/41184 License: CC BY 3.0 IGO.”
Digital Object Identifier
Associated URLs
Associated content
Report Series
Other publications in this report series
Journal
Journal Volume
Journal Issue
Collections

Related items

Showing items related by metadata.

  • Publication
    Projecting Demand for Skilled Foreign Labor and Meeting Skills Shortages : Selected Country Approach
    (World Bank, Washington, DC, 2013-01) Irving, Jacqueline
    Policy makers apply skilled labor gap projections to their immigration policies in a number of ways including: differentiating immigration policies by region, based on skills supply and demand mismatches; introducing more flexibility in admissions policies to acquire specific skills; and designing programs to actively attract immigrants with specific needed skills to specific occupations. Challenges in projecting an economy's demand for skilled foreign labor may include bias and gaps in available data sources, as well as difficulty determining the most appropriate methodology and impediments posed by imperfect methodological assumptions. A difficult economic context may provide further challenges to projecting and filling foreign labor needs.
  • Publication
    How Comparable are Labor Demand Elasticities across Countries?
    (World Bank, Washington, DC, 2001-08) Fajnzylber, Pablo; Maloney, William F.
    The authors present the first comparable dynamic panel estimates of labor demand elasticity, using data from Chile, Colombia, and Mexico. They examine the benefits, and limits of the Arellano, and Bond GMM in differences estimator, and the Blundell, and Bond GMM system estimator. They also explore the limitations of such measures for diagnosing flexibility in the labor market. Even accounting for the large variance induced by different estimation techniques, one probably cannot say much about the flexibility of different labor markets based on comparisons of the estimated elasticity of demand. Colombia, for example, which has severe restrictions on firing workers, has much higher long-run wage elasticity than Chile, which has no such restrictions. Three factors make such comparisons difficult: 1) Elasticity differ greatly across industries, so the composition of industry in each country probably affects the aggregate elasticity. Estimates are extremely dependent on the estimation approach, and specification. 2) Even for specific industries, the elasticity of labor demand differs greatly across countries. And the authors find no common pattern of country rankings across industries, which suggests that those differences cannot be attributed solely to systematic characteristics of the countries' labor markets. 3) Estimates for Chile over fifteen years, suggest substantial, and significant variations in elasticity over time. So comparisons across countries depend not only on the industries involved, but also on the sample periods of time used. Estimates change greatly, if not secularly, with sample period.
  • Publication
    The Road Not Taken?
    (World Bank, Washington, DC, 2022-11-17) Pollitt, Hector; Islamaj, Ergys; Kitchlu, Rahul; Le, Duong Trung; Mattoo, Aaditya
    Several countries in East Asia have increased fossil fuel subsidies to keep consumer prices lower than currently high international prices. These subsidies are discouraging the shift in consumption away from fossil fuels, while high prices are encouraging investment in new fossil fuel infrastructure. Providing income transfers instead of price subsidies would encourage consumption of cleaner alternatives, while softening the welfare loss. And subsidizing investment in renewables would avert the risk of being locked in to fossil fuels. The total cost need not be higher than that of fossil fuel subsidies.
  • Publication
    Labor Market Policy in Developing Countries : A Selective Review of the Literature and Needs for the Future
    (World Bank, Washington, DC, 2007-09) Fields, Gary S.
    This paper presents a selective overview of the literature on modeling labor market policies in developing countries. It considers welfare economics, theoretical models, and empirical evidence to highlight the three general features needed in future research on labor market policy in developing countries. The author identifies desirable research components (welfare economics, theoretical modeling, and empirical modeling) and pitfalls in the literature (inappropriate use of productivity, reliance on wrong kinds of empirical studies, lack of cost-benefit analysis, attention to only a subset of the goods and bads, and fallacy of composition). The paper concludes with suggested topics and methods for future research. The author states that sound labor market policy requires sound labor market models. The paper makes a case for developing policy based on explicit evaluation criteria, specific theoretical models, and comprehensive empirical evidence.
  • Publication
    Botswana Labor Market Signals on Demand for Skills
    (Washington, DC, 2014-01) World Bank
    Botswana has an official unemployment rate of 17.8 percent. The low labor-intensity of growth is a potential explaining factor for this high level of unemployment. It is thus essential to analyze the role of education and training in the access to employment. This note finds that the role of education has changed under the effect of schooling expansion and persistent unemployment. Labor market institutions appear to have a limited impact on employment and wage levels, while the importance of active labor market programs is growing. This note aims to identify labor market signals that point to demand for specific current and future skills. The note seeks to answer the following questions: does the labor market place a higher premium on workers literacy and numeracy skills, technical skills, or behavioral skills?; is the labor market more in need of secondary or tertiary education graduates?; and will growing economic sectors (for example, tourism) benefit more by increasing the supply of sector-specific skills (for example, through specific training for tour guides and hospitality staff) or general skills (for example, through training of lawyers and accountants who can be absorbed in any sector of the economy)?.This note analyzes the following data and documentation to identify labor market signals in the Botswana economy: government economic growth and diversification strategies; general labor market data; and enterprise and employee surveys.

Users also downloaded

Showing related downloaded files

  • Publication
    Kyrgyz Republic Country Climate and Development Report
    (Washington, DC: World Bank, 2025-11-03) World Bank Group
    This Country Climate and Development Report (CCDR) on the Kyrgyz Republic aims to support the country’s development goals amid a changing climate. The CCDR considers two policy scenarios up to 2050: the business-as-usual (BAU) and high-growth scenarios. As it quantifies the likely impacts of climate change on the Kyrgyz economy between now and 2050, the report highlights key government actions to best prepare for and adapt to climate impacts (referred to as “with adaptation” measures), with a particular focus on the time horizon up to 2030. The CCDR also outlines a path to net zero emissions by 2050 (referred to as “with mitigation” measures, “decarbonization,” or, simply, “net zero 2050”), highlighting associated development co-benefits.
  • Publication
    Comoros Country Climate and Development Report
    (Washington, DC: World Bank, 2025-06-18) World Bank Group
    The Union of the Comoros (The Comoros) has significant vulnerability to climate change-related risks but has considerable opportunities to strengthen preparedness and resilience against these challenges. According to the Notre Dame Global Adaptation Index, the Comoros is the 29th-most vulnerable country to climate change and the 163rd most ready to adapt (out of 191). The Comoros archipelago is exposed to many natural hazards that adversely affect the country’s natural capital, people, and physical infrastructure. In 2014, the economic cost of climate-related disasters was estimated at 5.7 million dollars annually, equivalent to 9.2 percent of Gross Domestic Product (GDP). Between 2018 and 2023, as many as 11 tropical depressions or cyclones impacted the country, with Cyclone Kenneth causing the greatest damage, equivalent to 14 percent of GDP, resulting in total economic growth falling from 3.6 percent in 2018 to 1.9 percent in 2019. More than 345,000 people (40 percent of the population) were affected by the cyclone, with 185,000 people experiencing severe impacts and 12,000 people displaced. However, there is an opportunity for the country to grow more robust and shock-responsive, and to establish pre-positioned funding mechanisms to enhance future crisis response efforts. For the Comoros, adaptation and climate-resilient development are the key climate change focus areas, with the country projected to face 836 million dollars 2050 in additional costs due to climate-related impacts. Current plans to adapt to the impacts of climate change in the Comoros include efforts to improve water management, strengthen coastal protection, and develop climate-smart agriculture practices. Given the country’s reliance on its natural resource base for economic growth and mobility, protection of these resources from climate change will be essential for promoting resilient growth and development. In addition to growing the adaptive capacity of the country’s natural resource sectors, strategic economic diversification will be important to help minimize future climate impacts, and development activities will need to be undertaken in such a way as to attract low-carbon co-benefits. The Union of the Comoros is committed to addressing climate change through its Nationally Determined Contribution (NDC) and national priorities. The country’s NDC (which was revised in 2021 for a ten-year horizon) sets ambitious targets, with a goal of reducing greenhouse gas emissions by 23 percent by 2030. The country also plans to significantly increase the share of renewable energy in its energy portfolio, reaching 33 MW by 2030. This will not only promote low-carbon development but also reduce the country’s dependency on imported oil and coal, which currently make up 95 percent of the energy mix. Additionally, the Comoros has declared its intention to increase CO2 removals by 47 percent by 2030, compared to BAU.
  • Publication
    Guinea-Bissau Country Climate and Development Report
    (Washington, DC: World Bank, 2024-10-23) World Bank Group
    Guinea-Bissau is endowed with a wealth of natural resources, with the highest natural capital per capita in West Africa (US3,874 dollars per capita), which could be leveraged for sustainable and resilient growth. However, Guinea-Bissau faces significant development hurdles, such as high poverty rates, political instability, and economic challenges, including an over-reliance on cashew nuts. Rural poverty has increased, and the nation's infrastructure, education, and health care systems are underdeveloped. Climate change poses a severe threat, potentially impacting agriculture, fisheries, and infrastructure. Without adaptation, it could lead to a significant cut in real GDP per capita (minus 7.3 percent by 2050) and increase in poverty (with up to over 200,000 additional poor by 2050, that is, 5 percent of the expected population, in the worst scenario). The country's low greenhouse gas emissions are expected to rise, mainly due to agriculture and land-use changes, with deforestation being a major contributing factor. Although Guinea-Bissau is a low emitter, it has high mitigation ambitions, targeting a 30 percent reduction in greenhouse gas emissions by 2030. The Nationally Determined Contribution outlines significant climate actions, with initiatives focused on forest conservation, sustainable agriculture, and community development. However, the country's political instability, institutional weaknesses, and limited financial resources pose challenges to implementing these climate commitments, which depend heavily on external funding. The financial sector's underdevelopment and vulnerability to external shocks limit its ability to support green investments, though reforms could enhance resilience. Guinea-Bissau must consider its climate financing as development financing and vice-versa, engage the private sector, and integrate climate goals with national development plans to ensure a sustainable future. Concessional climate financing is vital due to the underdeveloped financial sector and the government’s limited borrowing capacity. Addressing Guinea-Bissau's vulnerability to climate change and its structural issues requires a cohesive approach that integrates development and climate strategies. This could involve improving governance, diversifying the economy, protecting natural capital, developing human capital, and investing in sustainable agriculture and infrastructure. The transition to a more sustainable and inclusive development pathway that supports economic growth is possible, but requires focusing on key strategic sectors, enhancing institutional capacity, and creating the conditions to mobilize finance. As a highly vulnerable country, there are myriad needs in the different sectors; however, to be more efficient and effective, Guinea-Bissau should prioritize actions in a few sectors, especially actions on biodiversity, agriculture, and social protection. Low carbon development, especially in energy and forestry sectors, could provide cost-efficient solutions and attract climate finance, including from the private sector, which will support the overall development agenda.
  • Publication
    Jobs in a Changing Climate: Insights from World Bank Group Country Climate and Development Reports Covering 93 Economies
    (Washington, DC: World Bank, 2025-11-05) World Bank
    The World Bank Group’s Country Climate and Development Reports (CCDRs) provide a crosscutting look at how countries’ development prospects, and the job opportunities they offer to their people, can be threatened by climate impacts and supported by climate policies. Climate change and policies affect jobs through impacts on productivity, energy and material efficiency, and physical, human, and natural capital. They can also transform employment opportunities, especially through complementary measures that help workers and firms adapt to and benefit from new technologies and production practices. Prepared by the World Bank, the International Finance Corporation (IFC), and the Multilateral Investment Guarantee Agency (MIGA), CCDRs integrate country perspectives, climate science and economic modeling, private sector information, and policy analysis to assess how countries can successfully grow and develop their economies and create jobs despite increasing climate risks and while achieving their climate objectives and commitments. 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 the recommendations reflect national priorities. By combining evidence on adaptation, resilience, and emissions 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. Taken together, these elements can help create local jobs, ensure economic transitions are just and inclusive, and equip workers and firms to navigate the disruptions and opportunities of a changing climate and changing technologies.
  • Publication
    Mongolia Country Climate and Development Report
    (Washington, DC: World Bank, 2024-10-22) World Bank Group
    Mongolia’s development prospects are uniquely challenged by both the impacts of climate change and the global shift toward a low-carbon economy. The country’s efforts toward decarbonization pose significant challenges given the structurally high-emission intensity of its economy. While challenging, climate action also presents Mongolia with opportunities to achieve important development benefits. The effects of climate risks and the shift away from coal will have diverse impacts across different regions, communities, and socioeconomic levels. The report assesses the critical interconnections between Mongolia’s development ambitions and climate change action and identifies ways to transition to a more economically diversified, inclusive, and resilient development path. It highlights key climate and transition risks affecting Mongolia’s future development and presents a pathway to enhance climate mitigation and adaptation. The report also makes a case for strengthening policies to enhance resilience to climate change and ensure a just transition, particularly for the most vulnerable. The report is structured as follows: section 1 gives introduction. Section 2 delves into the linkages between development and climate in Mongolia and presents model-based findings on the economic and poverty impacts of climate change under different scenarios. Section 3 covers four in-depth sectoral analyses. The first two mainly focus on adaptation to climate change in the agriculture and water sectors. The third considers prospects for the extraction sector, while the fourth sectoral analysis focuses on decarbonizing power and heat generation. Section 4 shifts the focus to how the government can boost resilience for climate-vulnerable populations. Section 5 outlines options for mobilizing private and public financing and private investments to support the green transition. Section 6 examines the existing institutional and governance structure for climate action and presents recommendations to improve its effectiveness, and section 7 concludes with a framework for prioritizing the policy actions outlined in this report.