Emerging skills and wage gaps in the low-carbon transition

As governments worldwide increase their commitments to tackle climate change, low-carbon jobs are expected to grow rapidly. We provide evidence on the characteristics of low-carbon jobs in the US using comprehensive online job posting data between 2010-2019. By accurately identifying low-carbon jobs and comparing them to similar jobs within the same occupation, we show that: i) low-carbon vacancies exhibit higher skill complexity, especially for technical and managerial ones; ii) skill requirements are similar between high-and low-carbon jobs; iii) green reskilling patterns are highly occupation-specific. For most occupations, we observe a wage premium for low-carbon jobs that eroded over time and remained significantly smaller than the high-carbon wage premium. Our analysis makes the case for investments in reskilling as key ingredient of green recovery packages, but also highlight the need to enhance wage incentives in low-carbon jobs.