The global energy sector added nearly 2.5 million jobs in 2023 on the back of rising investment, bringing total employment to over 67 million workers. Employment in energy – which in this report includes energy supply, the power sector, end-use efficiency and vehicle manufacturing – rose by 3.8%, outpacing the economy-wide average of 2.2%. Energy job growth was fuelled by record levels of investment across a wide range of energy sources in the wake of the global energy crisis. As a result, jobs grew rapidly in both clean energy sectors (1.5 million) and fossil fuels (940 000) in 2023, a trend that held for all regions, albeit at varied paces. In China, clean energy made up over 90% of energy job growth, while in the Middle East fossil fuels accounted for 80% of the gains.

 All clean energy segments expanded in 2023, with overall year-on-year growth of 4.6%. Solar PV continued to lead clean energy employment growth in 2023, adding over half a million jobs as the sector once again surpassed expectations for new installations. While persistent, growth in other sectors was tempered by various complications. Employment in electric vehicle (EV) manufacturing and batteries grew by 410 000 as firms positioned themselves to capture more of the growing market, even as the vehicle manufacturing industry grappled with rising costs and increased global competition. While a number of wind manufacturers implemented layoffs as rising costs contributed to a slower-than-anticipated offshore project pipeline, total wind employment still climbed as a record number of new projects entered construction. Many sectors are also straining against shortages of skilled workers, especially those requiring high degrees of specialisation, such as grids and nuclear power.

Intense competition for talent in clean energy sectors is prompting firms to hire aggressively in anticipation of future growth – a tactic that could prove effective but may also leave some companies exposed to uncertainties related to project flows and changing policies. Countries that are forging ahead into clean energy are seeing significant employment growth from these sectors, with clean energy job growth representing over 10% of economy-wide job growth in China and 4-6% in advanced economies such as the United States, the European Union and Japan in 2023. However, in many emerging and developing economies other than China, clean energy’s share of new jobs is below 2%.

Overall fossil fuel employment grew by 3% in 2023, but firms took varied approaches in balancing near-term labour demand against the longer-term outlook. The oil and gas supply sector added nearly 600 000 jobs after a period of cautious post-pandemic rehiring, with new liquefied natural gas (LNG) infrastructure and upstream developments in the Americas and the Middle East contributing to growth. Global coal employment fell in both supply and power, largely due to continued mining productivity gains and a slowdown in the pipeline of new coal-fired power plants compared with the highs of the last decade. Employment in manufacturing vehicles with internal combustion engines rose by 440 000 jobs, just outstripping job additions in EVs.

Based on early data for 2024, energy jobs are expected to grow by about 3% in 2024, down from 3.8% last year. The IEA’s latest World Energy Outlook signalled a new context for energy markets, characterised on one hand by continued geopolitical tensions and on the other by ample supplies of oil, a surfeit of manufacturing capacity for key clean energy technologies such as solar PV and batteries, and an imminent overhang in LNG supply once a wave of new export projects begin operation. This could put downward pressure on prices and increase competition among suppliers which, combined with tight labour markets and elevated interest rates, may create a more fraught hiring environment for energy firms. While clean energy firms seem set to take more bullish positions on hiring in anticipation of growth, less diversified fossil fuel firms have been remaining cautious for now. As a result, fossil fuel job growth is expected to stall in 2024.

Manufacturing was responsible for the most job additions in clean energy sectors and the overall energy industry in 2023, contributing over 40% to overall growth. This contrasts with the 2019-2022 period, when construction and installation was responsible for over half of net job growth. The success of manufacturing reflects the 50% increase in clean energy manufacturing investment in 2023 as firms responded positively to a bevy of new policies aimed at attracting new clean energy technology manufacturing. China continued to lead gains in clean energy manufacturing with 300 000 new jobs, up 9% over the previous year. Growth in this sector in advanced economies was slightly faster at 10%, though these regions contributed fewer jobs overall. 

Just one-quarter of clean energy job growth since 2019 has occurred in emerging and developing economies other than China, despite these regions representing 60% of the global labour force. Many of these countries have had limited success in attracting the clean energy investment that fuels job creation, with the competitive advantage of lower labour costs insufficient to fully overcome structural barriers such as the lack of a strong existing manufacturing base, limited skills availability and inadequate infrastructure. Clean energy manufacturing has been the most elusive portion of the supply chain in these regions, with jobs in this sector growing 3% year-on-year compared with 10% in the rest of the world. Africa and Central and South America are the most extreme examples of this phenomenon, each accounting for just 3% of global clean energy manufacturing employment today.

Even so, some of these countries have success stories, and all have opportunities to stimulate future growth. India and Southeast Asia have fared relatively well, with clean energy manufacturing jobs in these regions representing nearly 15% of the global total. Other economies have found success in the upstream supply of raw materials for clean energy sectors, such as modern bioenergy and critical minerals, with emerging and developing economies other than China responsible for 80% of the job growth in this segment since 2019. Several countries, such as Viet Nam, Morocco and Malaysia, have also built sizeable automotive and appliance manufacturing bases. These factories mostly operate conventional production lines today but are well-positioned to pivot to clean technologies such as EVs and heat pumps as global demand continues to grow.

The 2023 World Energy Employment report signalled the growing risk that skills shortages and the inadequate pipeline of new workforce entrants pose to the clean energy transition. For the second year in a row, most respondents to the IEA’s survey of over 190 energy employers across 27 countries reported plans to hire but had difficulties finding qualified applicants for nearly all occupation categories. Though labour shortages in construction have fallen from recent highs in many advanced economies, supply remains tight, with 75% of respondents struggling to hire for these roles. Governments are employing a variety of strategies to address these shortages, including a renewed focus on vocational training, where the number of certifications conferred annually has generally been in decline. Many firms facing shortages of qualified applicants are also increasing on-the-job training to deliver these skills themselves.

When markets encounter a dearth of clean energy-specific skills, upskilling workers from related occupations can be a time- and cost-effective way to address shortages in the short term. New IEA analysis indicates that trade workers such as plumbers and electricians can quickly upskill to in-demand clean energy occupations such as heat pump technicians or solar PV system designers – transitions which generally offer sufficient wage premiums to quickly pay back training costs. Government incentives for retraining can help, as many trade workers are self-employed or in micro-enterprises, meaning training must be self-financed. However, this pathway is only viable if there is a sufficient supply of workers to qualify for upskilling, which is not the case in many regions. Continuing to expand the general pool of trade workers is essential to avoid simply shifting shortages from one part of the economy to another

After real wages fell in many regions in 2022, growth resumed in much of the world in 2023, though absolute wages generally remain below pre-pandemic levels. Wages for energy-specific roles have broadly fared better than those for more generic occupations relevant to the energy sector, notably for technicians. In major markets, occupations with an energy specialisation saw wages rise by up to 9%, outpacing non-energy jobs at 6%. The rising wages in the energy sector are partially a response to skills gaps, as firms aim to attract new workers from both within and outside the industry. As a result, clean energy wage increases were on average greater than those in fossil fuels, even in major oil, gas and coal producing countries. However, this growth has been insufficient to close the prevailing wage premium enjoyed by oil and gas workers, who earn around 15% on average more than workers in clean energy sectors.

Though net energy employment growth will be positive on a global level through 2030, the impacts of the energy transition on jobs and livelihoods will vary widely across localities. Just transitions policies, as well as broader labour market policies, can make a difference in determining the socio-economic impacts of transitions on communities and individuals. Coal is on the front line, with jobs in most regions facing a structural decline and workers generally possessing fewer transferrable skills than in other fossil fuel sectors. As of 2023, fewer than 15% of coal workers were covered by coal-specific just transition policies. Thoughtfully designed skilling programmes can help fossil fuel workers find new work in other parts of the economy, including in nearby clean energy sectors such as geothermal, modern bioenergy, critical minerals and hydrogen. Many energy companies prefer to hire from other parts of the energy sector before turning to other industries for talent. 

Job creation does not automatically contribute to the goal of decent work for all. Informal employment makes up a significant part of the energy labour force, especially in emerging and developing economies, with informal workers often receiving much lower pay and facing inferior working conditions. Government-led initiatives to reduce the size of the informal workforce in countries such as India and Indonesia are increasingly including energy-specific provisions. With the right guardrails, these efforts can create local value and help attract investment while improving the lives of workers and their families.

The energy transition and the jobs that come with it also offer opportunities to improve the gender balance of the energy workforce, with some clean energy sectors already having higher shares of women than fossil fuel sectors. For example, women make up about 40% of the solar PV workforce today, nearly double the share of the oil and gas industry. Narrowing the gender imbalance in the energy workforce will ultimately depend on increasing the number of women entering vocational occupations, which make up half of energy jobs. For some occupations relevant to the energy industry, like roofers or electricians, women represent less than 3% of the workforce today. 

Today, uncertainties are higher than ever, with geopolitical tensions and fragmentation threatening the pace of a secure and orderly energy transition. Firms operating in regions and sectors with greater policy clarity may have more competitive footing as they plan for expansion. The IEA estimates that about 50% of the energy jobs created through 2030 under today’s policy settings will not be bound to where projects are being developed, such as roles in manufacturing, professional services, engineering and project finance. With the right policy choices, education and skilling programmes governments can work with companies and labour representation to enhance competitiveness while improving the lives and livelihoods of workers, creating lasting benefits for people and the planet.