Unemployment insurance systems must now prove they can handle climate shocks

The World Bank wants countries in Europe and Central Asia to stress test their unemployment insurance systems against climate change. This means governments will need to plan for job losses caused by extreme weather or the shift to green economies, not just traditional recessions.

For years, unemployment insurance focused on economic cycles. This paper says that's not enough anymore. It means governments might need to fund new programs, like short-time work or retraining for green jobs, instead of just standard unemployment checks. It also means they need to measure their resilience to a new type of shock.