Potential escalation of heat-related working costs with climate and socioeconomic changes in China

Abstract

Global climate change will increase the frequency of hot temperatures, impairing health and productivity for millions of working people and raising labor costs. In mainland China, higherature subsidies (HTSs) are allocated to employees for each working day in extremely hot environments, but the potential heat-related increase in labor cost has not been evaluated so far. Here, we estimate the potential HTS cost in current and future climates under different scenarios of socioeconomic development and radiative forcing (Representative Concentration Pathway), taking uncertainties from the climate model structure and bias correction into account. On average, the total HTS in China is estimated at 38.6 billion yuan/y (US $6.22 billion/y) over the 1979'2005 period, which is equivalent to 0.2% of the gross domestic product (GDP). Assuming that the HTS standards (per employee per hot day) remain unchanged throughout the 21st century, the total HTS may reach 250 billion yuan/y in the 2030s and 1,000 billion yuan/y in 2100. We further show that, without specific adaptation, the increased HTS cost is mainly determined by population growth until the 2030s and climate change after the mid-21st century because of increasingly frequent hot weather. Accounting for the likely possibility that HTS standards follow the wages, the share of GDP devoted to HTS could become as high as 3% at the end of 21st century.