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Canada’s ‘Just Transition’ Act must consider workers outside fossil fuel industries

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An oil worker is looking at a large piece of machinery.

New research published today in Climate Policy finds workers in Alberta, Canada, could face job losses resulting from the global clean energy transition, even if they work outside of the province’s oil sands industry. The authors urge policy-makers working on the country’s forthcoming ‘Just Transition’ Act to consider these workers in the legislation; to help protect good jobs and livelihoods during the transition.

The shift to a low-carbon future is globally recognised as necessary and urgent. For example, the Intergovernmental Panel on Climate Change found that deadly forest fires, floods and heatwaves have become more frequent and intense due to human-caused climate change.

The research, from academics at the Smith School of Enterprise and the Environment, University of Oxford and the London School of Economics (LSE), examines how global oil prices affect labour in Alberta, where approximately 140,000 people work in the carbon-intensive oil sands industry.

It concludes that oil price fluctuations significantly affect Alberta’s employment levels, not only in oil and gas, but also in construction, professional services, hospitality and food services. These sectors are therefore likely to be at higher risk of job losses during the global transition to clean energy.

The Just Transition Act was part of Canadian Prime Minister Justin Trudeau’s 2019 election campaign, in which he pledged workers would “have access to the training and support they need to succeed in the new clean economy.”

By conducting interviews, the researchers also revealed workers in the sector struggle to change careers because of a negative perception of oil workers. As one interviewee stated: “I talked to people outside my industry who looked at my resume and they said that they don’t hire oil and gas people, because when oil goes back up, they all leave.”

“Our findings suggest the province’s current economic dependence on oil creates job precarity because employment in various sectors is sensitive to a volatile oil market,” explains lead author and LSE researcher Antonina Scheer, who conducted the research as part of her Master’s thesis at Oxford.

“If Canada’s and Alberta’s policy-makers take these sectors into account, the province could have a smoother transition away from oil sands production, while reducing its reliance on a product that has long created uncertainty in the labour market.”

Social dialogue with workers, wider consultations with potentially-affected communities, and economic diversification policies provide the best route forward for provinces such as Alberta, say the authors. These should be coordinated at a provincial and federal level.

Co-author Moritz Schwarz, a doctoral candidate at the Oxford Smith School, comments: “The debate around whether or not a clean energy transition will happen is over. It is now imperative that action is taken by policy-makers and other stakeholders to ensure the transition is just and fair – not just for fossil fuel industry workers, but for all workers whose fortunes have been closely tied to volatile oil markets.

“Our findings are relevant for any country facing a similar transition away from fossil fuel industries. To not act now risks not just stranded assets, but stranded livelihoods.”