Giulia Santangelo (Cedefop)
Alessia De Santo and Giovanni Mellace
This paper estimates the causal impact of European climate action investments on labour market dynamics, with a particular focus on the emergence and diffusion of green skills. Using more than 250 million online job advertisements from the Web Intelligence Hub - Online Job Advertisement (WIH-OJA) database across European regions between 2018 and 2024, we construct two measures of green skill demand capturing the intensity of green skill requirements within vacancies and their pervasiveness across postings. We link regional labour demand to climate-related expenditures financed through EU Cohesion Policy during the 20142020 programming period and address endogeneity in fund allocation using a shift-share instrumental variable strategy based on national mitigation investment shocks and regional exposure shares. Our results show that higher regional exposure to climate action funding significantly increases both the intensity and diffusion of green skill requirements in online vacancies. These findings indicate that early, place-based public investments in climate action play an important role in shaping firms skill needs and accelerating the incorporation of green competencies into hiring practices. The paper contributes to the growing literature on the labour market effects of environmental policy by providing direct evidence on skill demand and offers relevant insights for policymakers, education systems, and firms seeking to support workforce preparation for the green transition.