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The transition to a carbon-neutral and circular economy requires, inter alia, deep and rapid greenhouse gas emissions reductions in all sectors. This transition will have many and profound social consequences, including on employment and income but also on other social aspects such as health, care work, or household costs. While most studies find positive net employment effects by a green transition, effects can differ between different sectors, regions, qualifications, or along socio-demographic criteria. This makes it necessary to manage the transition in a just way, as acknowledged, among others, by the International Labour Organisation (ILO) and within the Paris Agreement.

While the term “just transition” is sometimes narrowly focused on people's jobs in the coal sector, it should be understood more broadely, as done, for example, by the ILO which states: “A just transition is greening the economy in a way that is as fair and inclusive as possible to all, creating decent work opportunities and leaving no one behind”.