Job creation in response to Japan's energy transition towards deep mitigation: An extension of partial equilibrium integrated assessment models

Energy transition towards carbon neutrality by 2050 in Japan will involve renewable energy development and a shift from fossil fuel energy. Investigating the domestic employment level in response to such energy transition and their implications of different decarbonization scenarios is urgently needed. We introduced the results from partial equilibrium (PE) integrated assessment models (IAMs), which provided a more comprehensive representation of power generation mix and capacity (based on a bottom-up modeling approach), to the input–output (IO) framework, which served as an efficient tool for mapping inter-sectoral transactions in the macroeconomy (based on a top-down modeling approach). By this approach, the uncertainties among different Japan national decarbonization scenarios can be investigated. We estimated the job creation in manufacturing sectors, construction sectors, electricity supply sectors, and all other sectors induced by the investment in the introduction of renewable energy capacity introduction and all power generation activities. The results show that: i) positive numbers in total job creation may occur in 2030 (e.g., under the default scenario reaching 80% emission reduction by 2050), as the job creation in the manufacture and construction of renewable related activities will exceed the job losses in mining, construction of thermal power, and thermal power generation activities; ii) however, such job creation will dramatically increase in 2050, leading to possible workforce shortages within Japan; iii) over 30% of the employment in non-electricity and manufacture sectors may be induced overseas in 2050. Compared with high renewable potential pathways, the long-term labor supply issues could be eased under low energy service demand pathways in Japan.