The dual forces shaping tomorrow's jobs: AI and green transition

AI and the green transition are the defining megatrends of our times, fundamentally reshaping the employment landscape and how we live. While much attention has been given to the impact of artificial intelligence (AI) on jobs, the green transition is an equally significant force driving change. It is therefore essential to consider AI and the green transition not as separate or parallel but as interconnected forces reshaping how we work and live. By leaning into this interconnected transformation of the economy and society with all the tools at our disposal (policies, training, financing, etc.), we can navigate towards a future that prioritizes sustainability, benefits positively from technological advancements, and ensures that the new world of work is inclusive and equitable.

AI's transformational potential must be aligned with the green transition

To effectively tackle climate change and ensure energy security, we're looking at a complete overhaul of the global economy—often referred to as the green transition. At its core, this is about shifting to economies and societies that are environmentally sustainable. This includes deep emissions reduction (reaching net-zero emissions by 2050), removal of historical and hard-to-abate emissions, circular approaches to the economy that minimize waste, and the protection of nature and biodiversity. AI, the most consequential technological advancement of our time, must be contextualized within this urgent global shift to net zero. To secure positive outcomes, it's crucial to look at the impact of AI, such as on jobs, within the broader context of the urgent need to transition the entire global economy and society to be sustainable.

The dual transition will have a profound impact on jobs

This dual transition is set to significantly disrupt labor markets over the next decade, leading to the disappearance of some jobs, the transformation of others, and the creation of many jobs that we can’t even begin to imagine. 

According to the International Labour Organization (ILO), approximately 25% of jobs in the world are potentially exposed to generative AI technology. While some professions, such as call center workers and data entry clerks are likely to be replaced, most occupations will be transformed—potentially augmented or even completely changed. These include occupations such as architects and pharmacists as well as many professions that are needed to meet the demands of a sustainable future, such as chemical engineering technicians or land surveyors. 

The green transition is also likely to disrupt employment. However, while the green transition may result in job losses in carbon- and resource-intensive sectors, it is expected to create far more opportunities. The ILO predicts that although around 6 million jobs might be lost globally, this will be significantly outweighed by the emergence of 24 million new jobs, driven by the adoption of sustainable practices. For example, wind turbine technicians are predicted to be the fastest-growing occupation in the U.S. (at 45%), with data scientists in third place (35%) between now and 2032, according to the U.S. Bureau of Labor Statistics. What this means is that we’re up for massive changes in employment, and we need immediate action in adapting our educational systems and policies to the imminent labor market transformations driven by AI and green transition.

AI plays an important role in accelerating and enabling the green transition

Besides being one of the key drivers of economic and societal transformation, AI can help with the green transition and mitigate the most severe impacts of climate change. The integration of AI into the green economy is already catalyzing new levels of efficiency, predictive accuracy, and innovation. Jobs in renewable energy, such as solar and wind, are not only growing but also evolving to incorporate AI, thereby creating new categories and redefining existing roles. For example, AI is being used for managing smart grids to improve electricity distribution and predict consumption patterns, thereby enhancing the efficiency and reliability of power supply. Indigo Advisory has counted more than 50 possible uses for AI in the energy sector - from grid maintenance to load forecasting - and estimates that AI is now worth up to $13 billion in the energy sector alone. Additionally, climate modeling and forecasting and precision agriculture are areas where AI's impact is already felt, enhancing our capacity for climate action and sustainable practices.

Navigating change effectively requires skilling, policy innovation, and collective action

The seismic shifts induced by the AI and green transition require a robust policy response centered around skilling (both reskilling and upskilling), income support during the transition, and a focus on ensuring the creation of quality employment.

Unfortunately, we are not at a good starting point. According to the latest data from ILO, 7 out of every 10 workers in low-income countries are undereducated for their jobs. While the ratio improves markedly as countries get richer, even in high-income countries, 2 out of every 10 workers do not have sufficient education for their jobs. AI has the potential to help workers improve their foundational skills, better equipping them to learn the skills needed for the green transition.

A further challenge is ensuring access to training opportunities along with adequate income support for workers to complete such training. Often, workers skip training because they can't afford to stop working, leading to lower-skilled employment not matching economic needs. Studies from Mauritius and Uruguay show higher training completion and job placement rates when workers receive income support. Thus, providing training alone is insufficient; it must be paired with financial support policies to facilitate these transitions, acknowledging the collective responsibility involved.

We also need to ensure the creation of quality jobs. The training of AI systems has opened job opportunities in Asia and Africa, though many are low-paid and lack employment rights and benefits. Green transition work like waste management, recycling, and particularly subsistence agriculture, often involves hazardous conditions and unstable, low pay. What this means is that skill upgrades must be accompanied by improvements in working conditions, ensuring formal contracts, set hours, minimum pay, and safe environments for workers. For developing countries, the green transition presents an opportunity to transform activities into high-quality, green jobs, enhancing both environmental and living standards.

Just transition is paramount

The move towards greener economies presents a unique opportunity to make significant equity gains, such as in closing the gender gap. Achieving this requires policies that not only prioritize environmental sustainability as we rush to green our economy but also ensure gender equity in new and transformed jobs. Women are over-represented in clerical support occupations that have the highest probability of automation (they are 2.5 times more exposed to automation than men according to the ILO study) and underrepresented in some of the major sectors requiring greening such as energy and construction (according to the International Energy Agency, women only account for 16% of the traditional energy sector; women hold only 10.9% of the construction jobs in the United States), targeted efforts are needed. Solutions include specialized training programs, policies that mandate equitable working conditions (e.g. for working mothers), and investment in disadvantaged geographies, such as the Inflation Reduction Act of 2022 (IRA) commitment to investing $60 billion in clean energy, climate, and electrification measures that support disadvantaged communities. 

In conclusion, the convergence of AI and the green transition presents a unique opportunity to redefine work, improve societal outcomes, and create a more sustainable society. But we need to act now.

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