29 October 2019
The world is struggling to transition to a zero-carbon economy and fears of automation and sector restructuring grow. At the same time, regional economic and social disparities remain high with income and job opportunities increasingly concentrated in large cities and certain regions. The green and digital transformations might aggravate such divides further and, in parallel, result in an array of urban policy needs.
In the face of these challenges, inclusive growth is achievable through Just Transition Plans. Such transition is intrinsically linked to social dialogue: “the importance of a participatory and representative process of social dialogue involving all social partners to promote high employment rates, adequate social protection, labour standards and wellbeing of workers and their communities, when developing [transition plans]” (COP24 Declaration).
The TUAC urges the OECD and its members to embrace the Just Transition Principles as a guiding framework to reassure citizens and working people that investments and coordinated actions are underway. A silo approach without a spatial and inclusive lens to both transitions risks leaving workers in sectors, regions and those working for SMEs behind.
Recent decades have been marked by a falling labour share of income, rising inequalities, and the increasingly difficult international and regional co-operation. Although regional economic disparities within OECD countries have started to come down, they remain at elevated levels. Furthermore, income and job opportunities remain concentrated in large cities and certain regions with unemployment rates differentiating by 6 percentage points within the OECD countries.
Adding to this, the impact of digitalisation might further exacerbate differences as regions with a larger share of workers with tertiary education, a larger proportion of jobs in services or highly urbanised will be better off. These disparities could be further worsened by technological diffusion, including the automation of tasks and intermediary functions but also the outsourcing and segmentation of process delivery along value chains enabled by new communication systems. Meanwhile, countries around the globe are struggling to firmly address climate change and move the global economy towards a zero-carbon economy. The urgency of ambitious climate action based on the IPCC’s 1.5°C report necessitates policy responses.
Policy makers need to consider the impact on workers, their families and communities. Just Transition measures are a crucial condition to implement the ambitious climate policies we urgently need. Without robust social conditions (involving investments, social dialogue, social protection, social justice, skills and education, etc.), there will never be enough support in society for the structural reform of our economies needed to protect the climate. Combined with the profound digital divides in rural areas, sectors being disrupted and urban populations resorting to new non-standard forms of work, the need to extend the just transition lens to other dimensions becomes glaring.
A successful transition to a zero-carbon economy holds the potential of sustainable economic growth, job creation in some sectors and social well-being. Digitalisation could support the green transition but runs counter in terms of employment trends and sectoral coverage. In this regard, the TUAC welcomes OECD work on regions and urban development, the Well-being Framework, the Going Digital and Future of Work projects amongst other. Just Transition policy and financing frameworks are key mechanisms towards the creation/ safeguarding of quality jobs and social cohesion for both transitions.