How Climate Change Is Affecting the Job Market and What Companies Can Do About ItAugust 10, 2022
Climate change will irrevocably change our lives and the lives of generations to come.
In addition to dire humanitarian crises, rising temperatures alone will cost U.S. businesses around $520 billion. This is expected to have impacts on a variety of industries, including both infrastructure and agriculture.
Despite the impending human and fiscal disaster, most nations are only taking tokenized action rather than committing to real change. Recently, the US Supreme Court effectively handcuffed the U.S. Environmental Protection Agency (EPA) by limiting its ability to reduce greenhouse gases and to hold fossil fuel firms accountable for their emissions.
The ruling by the Supreme Court pushes home another hard-to-swallow reality: as much as ordinary people might want to combat climate change, our only real option is to react to the choices that governments and fossil fuel companies around the world make.
While the effect of climate change is largely unpredictable, we can feel reasonably confident that it will undermine global job markets. In addition, it appears that — despite climate accords and rousing speeches — it may be up to private, profit-oriented companies to help lead us into a green future.
Climate Crisis and the Job Market
Rising temperatures and a rapidly destabilizing world spell disaster for job markets and vulnerable populations. A recent UN report found that 80 million full-time jobs will be lost due to warmer global temperatures and that up to 2.2% of total working hours worldwide will be cut due to the heat.
Climate refugees may also place unique pressures on job markets in the coming years. Since 2008, 21.5 million people have been “forcibly displaced” due to weather events like flooding, storms, wildfires, and extreme temperatures. By 2050, the number of climate refugees is likely to exceed 1.2 billion.
Further, the impact of climate change will be more pronounced in some industries than in others. However, those impacts may not be entirely negative. For instance, climate change has already impacted construction, resulting in weather-related delays and increased building costs. But this has also resulted in higher demand for sustainable construction materials, as well as workers who are skilled in new processes and technologies. This provides companies with the chance to invest in their employees and may create new job opportunities for employees. Of course, these silver linings don’t outweigh the ongoing damage of climate change, but they do indicate that there may be something we can do about this ongoing issue before it’s too late.
What Can Be Done?
When covering climate change, it’s easy to feel as though we are taking one step forward and two steps back. Without short-term incentives and legally binding climate accords, we face an uphill battle against climate catastrophe and serious tension in global job markets.
However, before descending into a climate-disaster tailspin, it’s important to recognize that some meaningful steps have been taken to reduce the impact of climate change on workers all over the world. Increased funding for climate research grants helps employers understand the conditions that their employees may face in the coming years.
In particular, upcoming research on labor market frictions and climate change shows that temperature stress may have a meaningful impact on the job quality and real income of many low-skilled workers. This may exacerbate current trends toward economic inequality and deepen the global trend of higher unemployment in the past decade.
While employees wait for meaningful legislation to be put in place in response to climate change, corporations simply must fill the gap and take a progressive stance towards working conditions and the rights of workers who are exposed to climate change.
Corporate climate responsibility alone clearly isn’t the solution to climate change, but it’s a good place to start. Corporations are well-positioned to make a meaningful difference in the lives of their employees as, unlike government agencies, they can move quickly to provide better working conditions and make a meaningful impact in their local environment.
Community engagement initiatives provide the perfect platform for corporations to participate in meaningful, local, climate activism. Large companies can sponsor and support local nonprofits and can work synergistically with community organizations to better serve their employees. Climate-oriented non-profits usually need funding to sustain their initiatives and can act as consultants to ensure that climate-conscious corporations fulfill their obligations to their employees. These organizations can then track and improve their sustainability efforts to ensure they’re meeting their goals and making meaningful, beneficial changes.
It’s important to note that corporate engagement initiatives are a stop-gap solution. In reality, we need to target the 100 companies responsible for 71% of global emissions. Addressing these companies will require a tactful approach that guarantees fossil-fuel workers jobs in green-energy industries.
In the meantime, corporations who operate in industries that are affected by climate change can do their bit to pressurize local and national governments into passing climate-conscious legislation. This legislation should incentivize corporate social responsibility and make it possible for progressive businesses to remain competitive with firms that fail to take their climate responsibility seriously.