Texas Summer Heat Costs State Billions

Temperature on a bank sign
Temperature on a bank sign | Image by mark reinstein/Shutterstock

The Lone Star State may have lost out on billions of dollars due to high temperatures sustained during the summer months.

A new study by the Federal Reserve Bank of Dallas found that the state’s gross domestic product (GDP) likely dropped by as much as $24 billion over the summer. The drop was attributed to residents opting to stay home because of the heat as well as choosing to vacation in cooler places like Colorado and Utah. Additionally, Texas attractions such as Schlitterbahn and SeaWorld reported “disappointing consumer activity.”

“The impact of an increase in summer temperatures on Texas GDP growth is twice as pronounced as the change in the rest of the U.S. because summers are generally hotter relative to the rest of the country,” explained the study.

Rising temperatures across the state also allegedly impacted job growth.

“The effect of rising summer temperatures on job growth is another potential concern. However, unlike the notable GDP growth changes, the impact on employment growth is more subdued,” wrote the study’s authors. “Data show a 1-degree increase in average summer temperature reduces annual Texas employment growth by 0.15 percentage points, equivalent to a 7.5 percent decline in Texas’ average annual long-term 2 percent growth rate.”

The study found that many of the negative effects on the economy caused by extreme conditions can be attributed to their effect on “health and productivity” as well as worker availability.

“Extreme weather conditions, both hot and cold, result in increased mortality rates. For example, when summer temperatures exceed 90 degrees, mortality rates spike by 2 percent, affecting labor supply and overall productivity,” reads the study.

With the number of 100-degree days allegedly projected to nearly double by 2036, research suggests that communities adapt to the heat by implementing measures to protect consumers as well as develop new “sustainable” technology that will “create walkable neighborhoods or retrofit existing buildings to improve energy efficiency and seasonal ease of movement.”

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