Beyond Green Jobs - Advancing Metrics and Modeling Approaches for a Changing Labor Market

Abstract:

The concept of “green jobs” has received widespread attention in academic, policy, and public discourse, reflecting the growing emphasis on sustainability and the transition to a low-carbon economy. However, defining and measuring green jobs remains analytically challenging and highly sensitive to methodological choices. This paper systematically examines how alternative classification criteria and data aggregation methods produce markedly divergent estimates of green jobs. It shows that the share of occupations identified as green ranges from 0 to 74 percent depending on the methodology, raising concerns about the comparability and usefulness of green job estimates in practice. Moving beyond the traditional green jobs framing, the paper proposes a more pragmatic and flexible framework that focuses on identifying jobs-in-demand and jobs-at-risk under specific transition scenarios. This approach allows for application across different country contexts and different transition scenarios and can also incorporate other structural labor market shocks, such as technological change or demographic shifts. The paper undertakes a literature review of quantitative methodologies to analyze labor reallocation in the context of given labor market shocks, highlighting the trade-offs between backward-looking (historical transition matrices) and forward-looking (task- and skill-based) approaches. It also discusses key challenges in integrating labor market dynamics into macroeconomic models and takes stock of recent efforts in hybrid modeling that combines macroeconomic frameworks with micro-level labor market insights. The paper concludes by outlining priority areas for future research and methodological development.