IRENA 2025 Report Projects Sustained Job Growth Through Southeast Asia’s Clean Energy Transition

The International Renewable Energy Agency (IRENA) has released its 2025 analysis highlighting the socio-economic impact of Southeast Asia’s clean energy transition. The new report focuses on the Association of Southeast Asian Nations (ASEAN) and provides updated insights into how the region’s shift towards renewable energy will shape jobs and economic growth in the coming decades. This is the second edition of IRENA’s study and offers a more detailed look at employment and economic trends under the 1.5°C Scenario—a pathway that aligns with high-ambition climate action targets.

The 2025 analysis marks a major revision from the earlier 2023 report. The earlier findings had suggested that job growth during the energy transition would be “front-loaded,” meaning most new employment opportunities would appear in the initial years up to 2030, with growth slowing down afterward. According to that earlier model, employment under the 1.5°C Scenario was projected to rise 1.4% above the baseline scenario until 2030, then fall to just 0.7% above the baseline in the years leading up to 2050. However, the latest report paints a far more optimistic picture. It now indicates that employment growth can be sustained throughout the transition period, extending strongly through to mid-century.

IRENA attributes this improved outlook to new enabling factors integrated into the model. These include stronger regional interconnections in the power sector, improved investment frameworks, and more inclusive economic planning across the ASEAN member states. Together, these measures help ensure that climate action not only generates short-term jobs but also fosters a steady and durable expansion in employment across multiple sectors. The revised analysis suggests that consistent and well-structured policy action can maintain a long-term upward trend in job creation, avoiding the slowdown previously expected after 2030.

The findings in the report compare two key pathways: the 1.5°C Scenario, representing an ambitious renewable energy transition, and the Planned Energy Scenario (PES), which serves as the business-as-usual baseline. The data clearly show that across every decade—2023–2030, 2031–2040, and 2041–2050—the 1.5°C Scenario continues to outperform the baseline in terms of employment growth. The sustained positive employment differential demonstrates that the clean energy transition can also act as a long-term driver of economic development and resilience for ASEAN economies.

Another major highlight of the report is the growing influence of “induced and indirect effects.” These effects capture the broader economic benefits created beyond direct jobs in renewable energy construction or manufacturing. As more people gain employment, consumer spending increases, wages rise, and productivity improves. These changes create further job opportunities across manufacturing, services, and other related sectors. Over time, these induced and indirect impacts are expected to become a major component of total employment gains.

IRENA’s updated assessment emphasizes that the energy transition will stimulate wider economic activity by lowering energy costs, expanding access, and creating new industries. The positive cycle of rising income, greater consumption, and new investment opportunities will generate broad socio-economic benefits across the region. Overall, the 2025 analysis confirms that the shift towards renewable energy is not just an environmental necessity but also a pathway to inclusive growth, improved livelihoods, and sustained job creation throughout Southeast Asia.