A recent global report looking at the health impact of extreme heat, the most damaging impact of human-caused climate change, projects an extremely worrying picture of the near future, starting with the next decade.
The report published by Berlin based Adelphi Global, an independent think tank for environmental and development policy and analysis, examines a wide range of effects of the heat and also its impacts on the economic impacts on individuals and households.
“… (It) is crucial to understand how heat and health impacts are weakening households’ and individuals’ economic situations in the short and long term and how those monetary consequences are shaped by different pre-existing factors,” says the report.
Loss of work hours and income
The study looks at the links between heat, health, and cost of living in the context of eight countries: Bangladesh, Brazil, France, India, Indonesia, Italy, Nigeria, and South Africa. Two parameters are looked at: “decrease of income and increase in private healthcare costs,” severely affecting individual and familial well-being.
Heat disrupts work, resulting in slowing down, longer breaks, or limiting working hours. If any illness is caused by the heat, recovery can take several weeks. This can affect income in a major way, especially in the informal sector, where employees are not covered by institutional protection: loss of working hours may mean loss of income, claims the report.
India, Bangladesh, Indonesia, and Nigeria experienced the highest loss of working hours, “leading to cumulative losses of 19+ days of work lost per year in the agriculture and construction sectors with severe heat risks projected for the near future for most parts of the countries,” says the report. A major point of concern for these four countries is that the informal sectors in agriculture and construction are considerable here, coupled with low pay in agriculture, especially for women.
Heat-loss impact shows north-south divide.
The report on heat-linked losses reinforces the global North-global South divide. “Brazil faces high losses as well, with cumulative losses of about seven days of work per year due to health impacts from heat,” says the report. “South Africa, France, and Italy face losses of about one working day per year in agriculture and construction,” it further adds, highlighting the contradiction.
Already, Bangladesh as well as Nigeria has high shares of medical out-of-pocket expenditures between 72 and 79%. Brazil and India, as well as Indonesia and Italy, have reduced dependencies on medical out-of-pocket expenditures between 22% and 44%,” says the report. France and South Africa fare better again, being less dependent on medical out-of-pocket expenditures, marked at 7-9%.
Out-of-pocket medical expenditure shoots
The report, however, stresses that absolute per capita medical out-of-pocket expenditure has shot up across almost all the analyzed countries since 2000. Even if the relative share has declined in countries such as India, Indonesia, and Brazil, people are still paying significantly more individually in absolute terms.
“As heat-related illness incidents will increase due to climate change and corresponding healthcare needs are projected to rise, the need for strong public health systems with reduced dependency on individuals’ medical out-of-pocket expenditures for treating such illnesses is evident, alongside the need for strong social protection coverage, including healthcare,” the report says.
Heat strikes GDP.
Heat health impacts lead to significant reductions in GDP each year. Countries “classified as upper-middle income economies,” such as Indonesia or South Africa, report high levels of poverty, with 68% of the population earning below USD 8.30 every day. Losses of working days from heat are adding to the risk of more people falling under the poverty line, says the report.
“…the economic impact of heat waves on the GDP is estimated at 0.97% losses in income worldwide (corresponding to about 1 trillion USD in 2024),” says the report. “Cumulative GDP losses of 5–7% are projected for 2026–2030 for the most exposed economies, according to Allianz research 2026. The heat wave in 2023 cost approximately 0.6% of GDP worldwide with regional fluctuations,” it adds.
This is a double whammy, as GDP losses eventually cause a “cost-of-living crisis” with stagnating wages and an increase in prices, the report observes.
Climate, health and labour needs linkage
Climate, health, and labour policy need to be integrated into a triangle, feel the authors of the report.
Experts point out that the UNFCCC is stressing action on heat-related health impacts and their social costs. Several entry points include the Global Goal on Adaptation, the preparation and implementation of the Belem Health Action Plan (BHAP), Nationally Determined Contributions (NDCs), (Health)-National Adaptation Plans ((H)-NAPs), and the efforts to make Loss and Damage financing operational.
Adaptation finance is important for organising finance for health, the report claims.