Heat waves as a result of climate change have severely impacted the GDP of countries whose populations depend on outdoor labour as a form of livelihood. As a result of the increasing intensity of heat waves, labour intensive sectors are especially affected and will continue to be so. A dual-pronged solution in the form of subsidies and insurance schemes could reduce the vulnerability of outdoor workers and increase their resilience. Subsidies increase the capacity of populations to improve practices and infrastructure for resilience-building, while insurance schemes transfer risks to the private and public sectors. Current financing structures must be reconfigured to meet this need.
Asian countries are wildly exposed to hazards related to climate change, such as floods, precipitation, cyclones and heat waves. The intensity and frequency of heat waves have increased recently, and mortality has also gone up (Pogačar et al. 2019). Outdoor labour contributes greatly to the GDP of most Asian countries. Billions of hours are lost annually by developing countries due to such incidents impacting the GDP of these countries. Projections for 2050 show that outdoor labour will become extremely difficult for certain countries where heat waves increase in intensity annually. For various Asian countries, the growing concern on rising temperatures call for necessary and urgent actions to ensure the problem does not continue to escalate.
Heat waves in Asia
Asia has some of the most developing countries in the world, many of which are vulnerable to worsening heat waves.
India, Bangladesh and Pakistan are most vulnerable in South Asia; Cambodia, Indonesia, Laos, Malaysia, Myanmar, the Philippines, Thailand and Vietnam have slightly lower risks (Woetzel et al. 2020). Due to a large labour-intensive sector that translates to a higher demand of outdoor working hours in these countries, populations and livelihoods there are at a greater risk. As such, labour productivity will fall significantly worldwide due to climate change, and the impact on Asia is especially severe (Gosling, Zaherpour, and Szewczyk 2019).
Over the last 100 years, global temperatures have risen by 1.5 °C; at the current predicted rate of trajectory, these will reach 4 °C by 2100
[i]. Heat waves have also become more intense and frequent. For instance, in India, heat waves claimed 17,000 lives in last 50 years and the mortality rate has gone up by 62.5 per cent (Ray et al. 2021). According to researchers, the projected losses are estimated to be US$ 450 billion (in PPP) by the 2030s (Tord Kjellstrom, Lemke, and Otto 2017). Pakistan too has suffered huge losses; heat accumulation is expected to increase between 17 and 32 per cent and between 54 per cent and 86 per cent by 2060 (Nasim et al. 2018). Therefore, the increasing intensity of heat waves has made outdoor labour more difficult and this situation is likely to worsen over the coming decades.
Research finds that the average loss of safe work time increased by 0.16-hour between 2003 and 2018 in Asia (Parsons et al. 2021). This has already amounted to billions of hours that have caused huge losses in GDPs of various countries. And if little is done to address the continuing risks, GDP losses in Asia would be around US$4 trillion dollars (Woetzel et al. 2020) by 2050.
Policy framework to tackle the issue
To tackle this issue, a dual-pronged approach is required. With the growing evidence of climate change and the effects in each country, such projections
[ii] show that outdoor labour will become too difficult in areas affected by heat waves.
To plan and build a solution, planning and decisions must first conform to the science of the problem and be treated as a Type-4 (Prioritisation) climate change-related crisis (Cashore and Bernstein 2022). The efforts to mitigate and reduce the number of outdoor working hours must also coincide with the rising threats.
Heat waves also stem from degraded lands and deforestation. Agriculture in areas prone to heat waves is not well-suited because they are water-intensive (Fahad et al. 2017). A solution may be to have incentives to promote better agricultural practices which are not water-intensive and promote forestation.
The incentives, could be in the form of targeted subsidies and insurance schemes. For instance, with subsidies, these can increase the purchasing power of farmers to plant trees and buy equipment e.g., for drip irrigation, could reduce heavy water usage. Insurance schemes can promote more sustainable practices in agriculture and forestation by transferring risks from climate damage from farmers to insurers, increasing financial ability to recover during disasters. Additionally, these can link to heat wave mapping; the most severely affected areas could have lower premiums and better guarantees for crop loss, creating incentives for better practices and forestation in impacted areas and reducing the intensity of heat waves in the longer run. On the other hand, such incentives can create path dependencies should agricultural practices incorporate the insurance element as an expected process integrated over time, making the policy decision harder to reverse (Auld et al. 2021).
But such incentives, say applied to the poorest farming areas or communities in India, could alleviate poverty over the longer term as it can provide more fiscal leeway to improve their crop resilience against climate risks, hence reducing their vulnerability to the potential threats in livelihood. Furthermore, in the shorter term, an incentive scheme could be tailored to annual changes in the intensity of the heat waves, creating a thermostatic setup which responds to natural hazards and sets perimeters to correspond to the evolving climate changes experienced in the area.
The recommended policy actions are well-suited because of Type-2 and Type-4 synergies. The schematic thermostat of providing relief creates resilience. Adaptation is also necessary due to heat waves’ growing impact. Actions should also be planned with twin objectives in mind: protection of lives and livelihoods (Type-4) and economic maximisation from saving water and risk transfer (Type-2). For instance, the local community/storage facilities should also be built with necessary provisions such as protection shelters for the population during severe heat waves. Government financial support is needed as well in the short term for policy implementation to be a success.
India presently offers a wide range of food and fuel subsidies. Such subsidies are inefficient since only a small portion of the funds are distributed to the recipients. Rao (2012), for example, found that kerosene subsidies are regressive and provide little financial benefit to disadvantaged rural households; only 26 per cent of the entire subsidy value reaches people directly. There is a need to rethink and channel funds more efficiently so that the inefficient subsidies from these sectors are redirected towards the imperative of building climate resiliency.
Conclusion
With growing heat wave intensity due to climate change, outdoor labourers will continue to be especially affected. While broader-scale economic policy changes are needed to reduce long-term dependence on agriculture, medium-term incentives to promote more sustainable agriculture and reforestation are also necessary to build population resilience to heat waves and the resulting agricultural losses. The incentives should also be means-tested to help those who need it most.
Coordination between the government and private sector is needed. In the long run, dependence on outdoor labour where heat waves are likely to be most intense should be reduced, compensated by resilience-building in reforestation to mitigate climate shocks through tree cover, and employment creation in other sustainable sectors with more adaptive economic policy-making.
This article has won first prize in the Institute of Water Policy Essay Writing Competition 2022. It was written by Mehtab Ahmed Jagil, Alumni, Master in Public Policy 2020-2022.
[i] This is the worst-case scenario based on countries’ current NDCs, which could be difficult to meet given current emission treads (business as usual scenario).
[ii] For Southeast Asia, “Results indicate that increased global warming is associated with substantial changes in heatwave characteristics over Southeast Asia, with more frequent heatwaves, longer heatwave duration, and higher extreme temperatures (Dong et al. 2021).
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