Europe Leads the Way in Labour-Market Resilience
In the 2024 GLRI rankings, the top ten continue to be dominated by European countries, the exception being Singapore, in 4th place. Switzerland has the most resilient labour market globally, followed closely by Denmark and the Netherlands. The top-ranked countries are characterised by stable macroeconomic environments, strong educational systems, inclusive labour markets, and high levels of innovation. They are open, technologically advanced economies, deeply integrated into global value chains and marked by diverse trading partners. Their institutional capabilities have proven crucial in navigating challenges like the COVID-19 pandemic and in addressing long-term structural changes, including the digital and green transformations.
However, not all European countries rank in the top ten, highlighting a regional disparity in labour resilience, particularly in Eastern and Southern Europe. As Europe aims to be the first climate-neutral bloc by 2050 through the European Green Deal, levelling up skills and social protection becomes essential to capitalise on the emerging green economy, while addressing the challenges of an ageing population remains crucial.
The Middle East
In the Middle East, a green transition is vital to diversify economies beyond oil and gas, foster innovation, and expand trade. The preparedness of labour markets for the green transition can make a significant difference to development prospects, and to standing in the GLRI ranking. While some countries, like the UAE, have established favourable business conditions, constrained innovation and the scarce utilisation of high-skilled labour are hampering performance. Since high-skilled roles often entail creative processes, policymaking should continue to steer the region towards a knowledge economy where such occupations can thrive, enhancing higher education and research while attracting and incentivising firms that employ skilled workers. For Saudi Arabia, investing in education, particularly among the youth, is imperative to upgrade workforce skills, alongside a policy framework that supports a sustainable and equitable green transition.
Switzerland
Switzerland leads this year's GLRI, rising from 2nd to 1st place. The leap follows an improvement in its economic diversity, an increase in the variety of goods the economy can produce, likely tied to its expanding green economy. Switzerland's success can be credited to its skilled workforce and outstanding innovation, supported by sound economic fundamentals, quality institutions, investment in R&D, dynamic entrepreneurship, and an effective financial system. Like other advanced countries, it faces an ageing population that could shrink the workforce and burden healthcare and social systems; policy should respond by targeting the participation of older workers and women, and by facilitating skilled immigration. A related challenge is ensuring enough workers with the requisite technical and STEM skills at every stage of the green transition, without which some industries may relocate production abroad.
China and India
China, ranked 36th, can redefine its economy through the green transition, underpinned by innovation, domestic consumption, and market orientation. It has the potential to become a leader in low-carbon technology and green finance, bringing increased green-sector productivity, high-skilled job creation, better employment quality, and reduced labour-market disparities. A key challenge is ensuring a sufficient supply of green skills to meet demand, while protecting workers through the transition.
For India (61st), the green transition is a golden chance to modernise, elevate living standards, and boost productivity. It can create millions of new green jobs in the energy sector and foster technological innovation, while cutting pollution and improving worker health. But there is a substantial task ahead in creating policies and laws that define green jobs and ensure a just transition, setting the legislative framework to create quality green jobs, protect vulnerable workers, enhance working standards, and promote gender equality.
Identifying the Challenges for Global Labour Markets
By comprehensively ranking 136 economies, the GLRI 2024 surfaces key insights into the strengths and weaknesses of the global labour market. The report recognises that jobs are exposed not only to the direct impact of global warming but also to the consequences of the climate policies introduced to tackle it. While absorbing and adapting to climate shocks leads to robust labour markets and effective policies, countries need to prioritise empowering their citizens through education to enable the green transition. Labour-resilient, high-income countries with quality institutions are better equipped to move forward, yet in stark contrast, the report finds that labour markets in 59 of 136 countries are ill-prepared for the changes induced by climate policies.
Moving Forward
The evolution towards sustainability necessitates structural changes in the economy, with effective policies and institutions serving as catalysts for "greening" the labour market. Policies should aim to curb the widening of inequalities during the green transition and mitigate its potential risks. Policymakers should also prioritise strengthening economic fundamentals so labour markets can seize emerging green opportunities: macroeconomic stability, trade resilience, and robust governance structures protect workers and firms from shocks and foster their adaptability.
The conceptual framework of GLRI 2024 is designed to measure the ability of labour markets to face and recover from disruptions, and to adjust to ongoing megatrends. To be resilient, labour markets must also be inclusive and sustainable. Labour resilience rests on two components: the Structural Pillar, encompassing long-term factors like demographics and economic stability; and the Cyclical Pillar, representing areas influenced by short-term policies. The Cyclical Pillar further explores absorptive, adaptive, transformative, and institutional capabilities, illustrating a country's ability to manage shocks, recover quickly, align with future trends, and foster resilience across all crisis phases and disruption types.
