Climate-Driven Health Risks Could Cost Global Economy USD 1.5 Trillion by 2050, Report Warns

New Delhi, September 18, 2025 – A recent report from the World Economic Forum and Boston Consulting Group (BCG) says that health concerns associated to climate change might cost the world at least $1.5 trillion in lost productivity by 2050. This is especially true if efforts to adapt and mitigate don’t pick up speed. The estimate, based on a mid-range scenario, includes damage to workers’ health and productivity in a number of important areas. These include food and agriculture, the physical environment, and health and healthcare. They don’t include possible losses in insurance, which means that the real costs could be much greater.

Key Findings

Even in the agriculture and food sector alone, climate-health effects may result in around USD 740 billion of lost output, compromising food security and exerting pressure on labor-based agricultural communities.

The built environment sector will be anticipated to lose an estimated USD 570 billion in productivity as a result of heat stress, hazardous working conditions, among other climate-related risks.

In the healthcare and health sector, the report projects losses of around USD 200 billion, as the increasing disease burdens, illness among the workforce, and the burden on healthcare systems drain labor and effectiveness.

Even though the report does discuss the insurance sector, its USD 1.5 trillion estimate does not include insurance-sector losses; the authors contend that the incorporation of insurance effects, increased claims, and other spillovers would further increase the number.

Business Imperative & Adaptation Priorities

The report makes it clear that protecting workers’ health and making company plans that take climate change into account are not optional; they are necessary to keep productivity and continuity. Companies are told to get ready for hazards like excessive heat, infectious diseases, and worsening environmental circumstances.

The report lists the following as high-priority adaptation measures: creating crops that can survive climate change; putting money into medicines that can withstand heat; improving workplaces’ cooling equipment and infrastructure; and creating new insurance models to address climate-health risks. Implementation is still uneven and underfunded.

Latest & Regional Examples

A recent related example: in Bangladesh, rising heat in 2024 cost the economy about USD 1.78 billion (roughly 0.4% of its GDP), with heat-related health issues leading to lost workdays, especially among vulnerable populations like women and the elderly.

Another insight from the report is that frontline and labour-intensive sectors  such as smallholder agriculture, construction, outdoor work, and informal economies in Asia, Africa, and Latin America – are disproportionately exposed to health-related productivity risks from climate change.

Future Outlook

In the future, businesses and governments will have to deal with the size and pace of climate-health hazards. Those who move quickly by putting money into strong infrastructure, worker rights, and regulations that take climate change into account are likely to have a competitive edge, prevent losses, and maybe even find new opportunities in climate insurance, resilient agriculture, healthcare, and cooling technologies.

On the other hand, areas with inadequate health systems, severe heat stress, and little ability to adapt are at risk of slipping even further behind. The cost of doing nothing will keep going up as climate extremes get worse. This will make healthcare more expensive, put a pressure on supply chains, and put a lot more people out of work.

As governments get ready for events like COP30, there is a chance to bring together policy, finance, and private sector innovation around adapting to health. To keep the possible $1.5 trillion loss in productivity from happening, it will be important to get people to invest, make climate-health data systems that function together, and make plans to make solutions bigger.

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