Impact of Global Climate Change on The Labour Market: Evidence from Türkiye

Abstract

In the literature, the relationship between climate change and the labour market is discussed in terms of whether climate policies create employment opportunities or increase unemployment. Therefore, whether the transition to renewable energy will increase unemployment or create employment opportunities is an important research topic. This study aims to investigate the relationship between unemployment and the use of renewable energy by focusing on the Turkish labour market. In the study, the Augmented Autoregressive Distributed Lag test is applied to determine the short- and long-run relationships of the variables with annual data for the period 1990-2019 obtained from the International Energy Agency and TurkStat databases. The results of the study show that in the long-run, a 1% increase in non-renewable energy reduces unemployment by 1.64%, while renewable energy reduces unemployment by 2.03%. In the short-run, every 1% increase in the use of renewable energy reduces unemployment by 1.06%, while a 1% increase in the use of non-renewable energy reduces unemployment by 1.31%. In this context, it is possible to say that non-renewable energy sources have a greater impact on unemployment in the short run. The results of the research suggest that climate policies focussing on renewable energy in Turkey can help fight unemployment.