Social and labour policies can unlock the climate deadlock

Every five years, signatory countries to the Paris Agreement update their Nationally Determined Contributions, outlining national climate policies and greenhouse gas (GHG) emission targets. We propose a simulation modelling framework leveraging data from the system of national accounts, national GHG emission inventories, and household and labour force surveys. With supply-and-use tables at its core, the framework assesses how structural changes in economies, driven by climate policies such as the adoption of low-emission energy technologies, affect direct, indirect, and induced employment by industry. We apply this approach to seven economically diverse countries in Sub-Saharan Africa, examining policies related to renewable energy, industrial processes, sustainable agriculture and tourism. Estimates of technological change are informed by national statistical data, expert knowledge and secondary literature. We find that climate policies generally lead to net-positive nationwide employment gains. The findings can support governments in designing complementary Just Transition policies that maximise gains and improve fairness.Highlights – We analyse ‘what-if’ NDC climate policies using country-specific inter-industry trajectory models for seven different Sub-Saharan African countries.– We find that most climate policies yield net-positive nationwide employment gains.– However, job losses occur in carbon-intensive sectors, with industry-level impacts depending on the nature of the policies.– Climate policies may disproportionately impact low-income households, as induced effects of higher energy prices raise costs of food, housing and transport, for which low-income households have higher propensity to spend.– The modelling results indicate where climate policies generate negative implications, an information that is essential for designing Just Transition policies as stipulated in the preamble of the Paris Agreement to fit the aims of the UNFCCC workstream on the ‘Impacts of the implementation of response measures.’