Climate change is poised to slash the average income of individuals worldwide by a fifth, or 19%, by the year 2050.
A new report published in the journal Nature by the Potsdam Institute for Climate Impact Research delivers a stark warning: Climate change is poised to slash the average income of individuals worldwide by a fifth, or 19%, by the year 2050. The report underscores the dire consequences of unchecked climate change, projecting global economic losses totaling $38 trillion annually by mid-century.
The findings reveal that these losses are already inevitable, irrespective of future emission reduction efforts. Maximilian Kotz, co-author of the report, emphasized the limited scope for mitigation, stating, “What we find is that over the next 25 to 30 years, impacts on the economy are consistent across different emissions scenarios, regardless of whether we enter a high-emission or low-emission world.”
One of the key factors exacerbating these economic repercussions is the demonstrated correlation between rising temperatures and diminished worker productivity. Kotz elucidated, “That’s then going to be manifest across numerous different industries — although it’s particularly strong, those impacts, when workers are outdoors, so in contexts like manufacturing sectors.” Moreover, agricultural productivity faces significant threats from soaring temperatures, compounding the overall economic downturn.
The comprehensive study drew upon climate and economic data spanning four decades across more than 1,600 regions worldwide to project future impacts. Alarmingly, those least culpable for global emissions are poised to bear the brunt of these economic setbacks. The report notes, “Committed losses are projected for all regions except those at very high latitudes, at which reductions in temperature variability bring benefits.”
Despite the grim outlook, the authors assert that addressing climate change preemptively would be significantly more economical than coping with its aftermath. They estimate that the cost of reducing greenhouse gas emissions would only amount to one-sixth of the staggering $38 trillion economic impact projected for 2050.
However, the research likely underestimates the full extent of the economic toll of climate change. The report acknowledges the exclusion of crucial factors such as heatwaves, sea-level rise, tropical cyclones, tipping points, and non-market damages to ecosystems and human health from its estimates.
In conclusion, the report paints a sobering picture of the looming economic repercussions of climate change. It underscores the urgency for global action to mitigate emissions and adapt to the changing climate to avert catastrophic average income losses and safeguard livelihoods worldwide.