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Employment responses to increased biodiversity transition risk

Author

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  • Nguyen, Duc Duy
  • Nguyen, Huyen
  • Nguyen, Trang
  • Sila, Vathunyoo

Abstract

This paper examines how firms adjust the number and types of workers they hire in response to increased biodiversity transition risk. Using the adoption of the Key Biodiversity Areas Standard of 2016 as a source of variation that increases the risk of future land-use restrictions, we find that firms reduce job postings in affected areas and reallocate labor to less exposed regions. This effect is concentrated among firms that make negative impacts on biodiversity. Cuts are stronger among production roles, while hiring in green and adaptive occupations increases. The effect is not driven by changes in capital investment or workers’ labor supply decisions. Our findings contribute to the ongoing debate on the costs and benefits of biodiversity conservation policies and their implications for labor market outcomes.

Suggested Citation

  • Nguyen, Duc Duy & Nguyen, Huyen & Nguyen, Trang & Sila, Vathunyoo, 2025. "Employment responses to increased biodiversity transition risk," IWH Discussion Papers 20/2025, Halle Institute for Economic Research (IWH), revised 2025.
    • Handle: RePEc:zbw:iwhdps:331888
    DOI: 10.18717/dp640x-nc05
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    JEL classification:

    • G30 - Financial Economics - - Corporate Finance and Governance - - - General
    • J01 - Labor and Demographic Economics - - General - - - Labor Economics: General
    • Q57 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Ecological Economics

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