Rising Heat, Plummeting Productivity: The Economic Cost of Extreme Heat in Singapore

Singapore’s economy may face losses exceeding $1.5 billion due to heat strain

Rising Heat, Plummeting Productivity: The Economic Cost of Extreme Heat in Singapore

A recent study by the National University of Singapore revealed that Singapore’s economic losses due to heat stress could nearly double to $1.64 billion in 2035 from pre-pandemic 2018. The decline in labor productivity across Singapore’s major economic sectors due to heat strain in 2018 was significant, with an 11.3% fall in average productivity. The situation is expected to worsen, with productivity projected to decrease by 14% in 2035, resulting in an economic loss of S$2.22 billion.

Workers exposed to adverse environmental conditions, such as those working under the sun or near heat sources like machineries, will experience even higher productivity losses. The study estimated that for every hot day, the reduced productivity of workers results in a median income loss of S$21 per worker.

The Project HeatSafe conducted by the National University of Singapore is the first large-scale study in Singapore and the region that aims to assess the impact of rising heat levels on productivity and health on both individual and macroeconomic levels. Taking 2018 as the baseline for the study, the research team chose this year as it was pre-pandemic and the last “normal year” for which data was available.

Recent extreme heat exposure has been a concern globally, with Singapore experiencing intense heat twice within four days. The country is not alone as scientists have warned of surpassing key warming thresholds globally. The impact of extreme heat exposure goes beyond productivity, affecting cognitive capacity, physical exertion, and even fertility rates in Singapore, which are already at historic lows.

In conclusion, it is crucial for policymakers and employers to take proactive measures to mitigate the effects of rising temperatures on labor productivity and ensure workers’ safety while working under extreme conditions.

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