UK heatwaves estimated to have cost economy £4.4bn in lost output
Repeated periods of extreme heat could have cost the UK economy £4.4bn in lost productivity by the end of July, with businesses facing growing economic risks as temperatures rise.
By The Guardian
Repeated heatwaves are estimated to have cost the UK economy £4.4bn in lost output by the end of July as high temperatures affected workers, equipment and infrastructure.
The estimate comes from green thinktank Verdant, which has updated an earlier assessment of the economic impact of June’s hot weather to take account of further periods of high temperatures during July.
Its analysis suggests the economic consequences of increasingly frequent heatwaves could become substantially greater over the remainder of the decade.
Verdant estimates that annual losses could exceed £25bn by 2030 if the intensity of heatwaves continues to increase at a similar rate to that seen during the past decade.
The figures are projections rather than official measures of lost UK economic output.
They attempt to quantify the effect that extreme heat can have on businesses through lower worker productivity and disruption to machinery, buildings and infrastructure.
High temperatures can make physical work more difficult, while offices and other workplaces without sufficient cooling can also experience reduced productivity.
Equipment and infrastructure can be affected when temperatures exceed their normal operating conditions, potentially leading to reduced performance or temporary shutdowns.
Verdant’s calculations draw on European estimates from insurer Allianz, which suggest that worker productivity falls by around 3% for each degree that temperatures rise above 30C.
The thinktank also points to separate research from the Grantham Research Institute on Climate Change and the Environment at the London School of Economics examining the effects of hot weather on UK workers.
That research estimated that June’s heatwave alone resulted in more than £1bn of lost economic output.
A survey conducted as part of the research found that 3.6% of respondents said they did not work at all during the week beginning June 22 because of the heat.
Health effects were considerably more widespread.
Around 87% of those surveyed reported experiencing at least one heat-related health impact, including problems such as disrupted sleep and dizziness.
The findings highlight a growing challenge for employers as periods of unusually high temperatures become more frequent.
For businesses, the economic consequences can extend beyond employees feeling uncomfortable at work.
Reduced productivity, staff absence, cooling costs and disruption to equipment or transport infrastructure can all contribute to the overall cost of extreme heat.
The issue could become increasingly important for businesses considering investment in offices, factories, warehouses and other workplaces that were not originally designed to operate during prolonged periods of very high temperatures.
The latest estimate comes as much of England experiences another spell of hot weather, placing renewed attention on how businesses and public infrastructure cope with extreme temperatures.
Verdant argues that investment in measures to make workplaces and infrastructure more resilient to heat could reduce some of the economic losses expected in future.
Its £4.4bn figure should, however, be viewed as an estimate of the potential economic impact rather than a confirmed calculation of output already removed from official UK GDP figures.