New analysis suggests that repeated heatwaves this summer have likely cost the UK economy more than £4 billion in lost economic output by the end of July. Green thinktank Verdant updated its assessment, finding a £4.4 billion hit to output, following an earlier estimate of £2.36 billion for June's hot weather.
Direct economic costs are attributed to reduced worker productivity during heatwaves, as well as infrastructure and equipment shutdowns due to overheating. James Meadway, Verdant's director, stated that the economic costs of climate change are already present and are expected to worsen.
Verdant is advocating for the government to implement a maximum working temperature and to provide compensation for workers who are forced to reduce hours due to extreme heat. The thinktank also highlights the need for investment in urban redesign to create cooler green spaces in towns and cities.
The estimates from Verdant exclude indirect losses, such as the cost of fighting wildfires and increased electricity consumption from fans and air conditioning. The thinktank suggests that London and the south-east, areas with the highest temperatures, are likely to have experienced the largest impact.
If heatwaves continue to intensify at the same rate as the last decade, Verdant projects that the annual economic cost could rise to more than £25 billion by 2030. These estimates align with research from the Grantham Research Institute at the London School of Economics, which indicated over £1 billion in lost output during June's heatwave alone.