• Research & Analysis Services I Academic I Market & Industry I Government Policy I
Labour & Climate Change

Labour & Climate Change

Climate change and the energy transition is going to impact the workforce and change where and how we work. Understanding these patterns will better equip countries and financial institutions on how to ensure that the move away from carbon-heavy economy does not come at the cost of the worker. Rather than carbon, which defines the register of climate change- the indicator for the climate transition can be the community, as a repository of lived experience. When the human scale is the index for climate transition, the conversation on climate change is rooted in local realities.

There are two pathways to think of a labour centric climate transition first of which is brownfield, a move from existing industries to the climate pivot. Consider the coal miner in Australia who is facing redundancy as pressure mounts to divest from this polluting fuel and to shutter mines.  In this period where countries are feeling the sharp end of climate change and having to decarbonise quickly to hit climate goals, more needs to be done to accommodate labour forces during the energy transition.

The velocity of climate transition will depend on the intersecting space in the Venn diagram between the old, energy intensive economy and the green paradigm, which is the delta for climate transition. Reskilling communities are a generational endeavour, however if the climate transition is gauged through the labour perspective, then a radical sense of immediacy is injected in the debate one factory floor at a time. Thinking about worker agency for a worker in an organisation undergoing the climate transition in a direct manner in an oil company is easier than the secondary and tertiary support workers dependent on the core energy sector. The enthusiasm of the oil producing nations towards pivoting to green and blue hydrogen is linked to the potential of retrofitting the existing oil refining and pipeline infrastructure for the green economy. The political economy of the ‘place’ and its labour geographies will be coupled to the low carbon transition of the region under consideration.

Despite coming under greater scrutiny, the oil and gas sector is still the dominant energy provider. Nevertheless, the workforce that underpins energy production from the offshore fields of the North Sea in Scotland to Jurong Island in Singapore through to the mature oil fields of the Arab Gulf are undergoing a major recalibration. The capacity of worker agency to withstand and adapt to the seismic shifts that will come with the energy transition, will depend upon the institutional power of the worker unions to voice their dissent. The older worker who is at the tail end of their career have more to lose than a younger professional who can retrain to a low carbon skill set. The frameworks and capacity of the region’s governments will determine how these workers re-enter a different career path.

Any discussion of labour in the media, is generally viewed from a vantage point of a top-down lens where agency of the worker is muted veering towards rather the helpless.  Singapore has included the reality of a labour reskilling transition in parliamentary debates from traditional avenues to the net zero economy in the light of the emergent carbon tax regime, that will shape corporate decision making.  A low carbon future impacts the oil refining sector, as well as the carbon intensive maritime bunkering space.  Singapore happens to be the fourth largest exporter of refined petroleum.

The informal worker in the ‘eco-precariat’ impacted by the negative externalities of climate change will have different adaptation modes, including resilience in their everyday lives that is driven by survival. The green economy will be based on the business-as-usual economy which has precarious people, such as project work-based GIS specialists who create tools for visualising carbon sinks or seasonal sharecroppers on peatlands in Indonesia. 

Capital is needed to help countries and the workforce adapt to climate change and the energy transition.  Climate risk will become expensive for companies and citizens. For example, insurance companies will charge clients a higher rate of interest if they own a mortgage in a flood risk prone area. Some may not even be eligible for insurance.  Funnelling capital towards the construction of resilient infrastructure is benchmarked with Environmental, Social & Governance (ESG) standards. This linkage can help amplify labour agency. Greater oversight and the international pressure to adhere to ESG standards could ensure that worker welfare is improved in spaces where state-based institutionalised power is weak.

While voluntary, ESG standards enable worker agency in Global Production Networks, over riding or complementing the role of the place, beyond the statutory legal framework of the country. Worker agency is acknowledged and reflected in multilateral developmental financial agencies linked social safeguards standards, hence invigorates the worker involved in climate transition projects. The social aspect of ESG presents an opening into understanding the worker agency through the voices engaged in the stakeholder engagement process in the project affected area. Although prone to the performance of participation, in the author’s lived experience as a social auditor, worker agency does get expressed through established stakeholder management mechanisms. Voicing perspectives through stakeholder engagement platforms in ESG-linked development finance projects can be considered a form of ‘reworking’ by the employee.

 I was the lead social specialist for an impact assessment report for a multi-million-dollar 500MW solar park on the Saudi border.  Long-term migrant workers from south Asia were identified as camel farmers in the desert on project land., However, during a   recce visit and after speaking to long-term migrant workers looking after camels, we discovered that they were extremely precarious relying on a solar-powered battery charger for mobile phones and to light a bulb.

These workers, who were heavily reliant on precarious work, were being moved away from their off-grid homes to build a Chinese-funded solar park in relatively prosperous Oman. The irony was not lost on me. Globally accepted ESG governance norms kicked-in and the workers’ protest the move triggered an independent Resettlement Action Plan for these workers. Without this ESG framework in place, this course of action would have otherwise been unlikely given the inadequate legal architecture in Oman as the migrant worker is relegated to a census statistic, if at all counted.

Sustainability reporting is mandated for many banks and publicly listed companies in Singapore as per a recent upsurge in non-financial disclosure. Sustainability bonds are being floated by lenders towards achieving a decarbonisation agenda, such as the Nanyang Technological University in 2021. Worker welfare as a metric of ESG Sustainability performance brings worker agency to the fore, and it might seem counter intuitive as neoliberal rhetoric frames have a not so worker friendly image.

Environmental degradation is known as slow violence, eating away at the planet’s capacity to be habitable. Yet, when extreme weather events such as flooding or droughts manifest due to climate change, workforce productivity is impacted. At a community level, resource scarcity triggers workers to migrate elsewhere. For example, multiple droughts in the sugar and cotton belt of western Maharashtra State in India, have triggered a wave of migration. Economic hardship has had a mental toll on affected communities with an increase in suicide rates among farmers. Workers have moved to urban centres such as Pune, Bangalore, and Mumbai in the search for construction labour during the non-sowing season. Similar migration trends driven by adverse climate can be observed in other parts of South Asia such as Bangladesh as well.

 The conversation around climate change adaptation has largely focused on risk, vulnerability, and resilience with little thought about how a ‘just transition’ will impact workers. The formation of a ‘green economy’, as a response to climate change, is an uneven terrain as different communities of practice will have varied social capital (mainly skills) to expend to evolve and adapt informal sector workers including gig/platform workers as when a city floods, the platform economy driver must turn up to work, otherwise they are not paid, with the daily rental to serve.

Leave a Reply

Your email address will not be published.