A slower shift to clean energy could leave the world with 1.3 million fewer energy sector jobs by 2035 compared with a scenario in which governments fully implement their green policies, the International Energy Agency (IEA) has found.

In its annual World Energy Employment report, the Paris-based watchdog said on Friday that the Current Policies Scenario (CPS), which it reintroduced under pressure from the Trump administration, has “more muted” employment growth than the Stated Policies Scenario.

The CPS sees oil and gas demand continuing to rise until at least 2050 – a scenario that the IEA described as “cautious” and “anchored in enacted laws and measures” and was widely criticised by clean energy experts.

A fast energy transition would spur investment in construction, creating more jobs across the sector. New roles for electricians, building insulators, solar panel and energy-efficient lightbulb installers, and transition mineral miners would more than offset job losses in coal mines, power plants and oil and gas fields, the report found.

Anabella Rosemberg, Just Transition lead at Climate Action Network International, lamented that the clean energy sector is “being undermined at a time when employment creation is of utmost priority”.

“Climate ambition and decent job creation must go hand in hand – but as the recent conversations at COP30 showed, there is a need for both the right targets and just transition strategies to make it happen,” she added.

A more ambitious Net Zero Emissions scenario, aligned with the Paris Agreement goal of limiting global warming to 1.5C, would see roughly ten million more energy jobs created than under the CPS, report author Daniel Wetzel told Climate Home News at a press conference.

Bottleneck warnings

The IEA warned that governments must act to train workers for these roles or risk facing shortages of electricians, welders, and grid specialists – a gap that could slow the energy transition and drive up wages and energy costs.

IEA head Fatih Birol highlighted a particular shortage of qualified workers in the nuclear industry, warning that the problem could worsen as the sector’s workforce continues to age. “I hear nuclear is making a comeback, but the interest in the nuclear sector for the jobs is rather weak,” he said.

Laura Cozzi, IEA’s Director of Sustainability, Technology and Outlooks, warned of a shortage of skilled workers in electricity grids. “That is one of the key ingredients why we are not seeing grids ramp up as [they] should,” she said. Over 60 governments pledged at COP29 to improve and expand their grids to enable clean electricity to flow to where it is needed.

Bert De Wel, Global Coordinator for Climate Policy at the International Trade Union Confederation, celebrated that the energy transition is creating jobs but added that they should be good jobs with decent pay, conditions and union rights. Decent work would attract skilled workers, he added.

The report found that wages in the oil and gas industry have generally risen faster over the past year than in the solar – and especially the wind – sectors. It noted that the oil and gas industry has a “historical tendency to offer highly competitive wages to attract and retain top talent”.

At the COP30 climate summit, governments agreed to set up the Belém Action Mechanism to try and make the energy transition fairer to groups such as workers in the energy industry. It will give trade unions a formal role in shaping just transition policies, for what the ITUC says is the first time.

ITUC General Secretary Luc Triangle called it a “decisive win for the union movement and working people across the world, in all sectors but especially those in transition industries.”

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IEA: Slow transition away from fossil fuels would cost over a million energy sector jobs