Is it getting too hot to work? Investigating the impact of climate change on labour supply in the MENA region

ABSTRACT

Climate change and its expected consequences have been a growing global concern. This study aims at examining the impact of changes in climate indicators on labour supply in the Middle East and North Africa (MENA) region. We use different data sets including the Integrated Labour Market Panel Survey of Egypt, Jordan, and Tunisia spanning the period from 2006 to 2018 matched with a globally gridded climate data set to test the impact of changes in temperature, humidity, and precipitation on labour weekly working hours. We differentiate between ‘high-risk’ groups engaged in economic activities with higher exposure to climate and ‘low-risk’ groups with relatively less exposure to climate. Our results indicate that changes in temperature and humidity have a significant impact on labour working hours, whereas precipitation has no significant effect; yet the marginal impact of changes in temperature and humidity differs between ‘high-risk’ and ‘low-risk’ groups. The results show that working hours are impeded by heat and humidity after a specific threshold.

KEYWORDS:

• Climate
• temperature
• humidity
• labour supply
• mena region

JEL CODES:

• Q54
• J22
• N35
• N55

Acknowledgement

We are grateful for funding from the Economic Research Forum (ERF) and for valuable comments from the discussants in the ERF webinar on “Mitigation and Adaptation to Impact of Climate Change in the MENA Region” and ERF anonymous reviewers.

Disclosure statement

No potential conflict of interest was reported by the author(s).

Notes

¹ We examined the impact of the heat index provided by the National Oceanic and Atmospheric Administration (NOAA), which is a combination of temperature and relative humidity, on labour working hours. Our results indicated labour working hours are reduced significantly when the heat index is in the danger or extreme danger zone in high-risk groups. However, the relationship is not significant for low-risk groups.

Additional information

Funding

The work was supported by the Economic Research Forum.