Heat Stress Could Cost Ethiopia USD 33.3bn a Year by 2040, ILO Warns

Rising temperatures could cost Ethiopia an estimated USD 33.3 billion in lost annual economic output by 2040, according to a new study by the International Labour Organization reported by The Reporter Ethiopia on 31 October. The figure is the highest of the six countries the study examined, and it comes from the low-emissions scenario, which means it describes a path in which the world cuts emissions rather than one in which it fails to.

The study looked at Ethiopia, Ghana, Lebanon, the Maldives, Senegal and Sri Lanka, and measured how heat reduces working time, health and safety, and therefore productivity. By 2040 under the low-emissions scenario, Sri Lanka's projected annual loss is USD 26 billion, Ghana's USD 23.2 billion, Senegal's USD 10.5 billion, Lebanon's USD 2.6 billion and the Maldives' USD 575.5 million. Ethiopia sits at the top of that range largely because of its large labour force and its heavy reliance on agriculture and other outdoor, physically demanding work.

The longer horizon is starker. By 2060, the report says, Ethiopia's annual GDP losses could range from USD 79.4 billion to as much as USD 310.3 billion, depending on which emissions pathway the world follows. The same logic applies to jobs. Under the low-emissions scenario, the lost working time by 2040 is equivalent to 1.78 million full-time jobs every year, and by 2060 under high-emissions scenarios it could reach between five and six million full-time equivalents. These are not layoffs. They are hours that cannot safely be worked, converted into the number of full-time jobs they represent, and they translate into lower earnings for households that often have little to fall back on.

The sectors most exposed are agriculture, construction, fisheries and transport, all of which depend on people working outdoors for long hours. The study notes that the size of the damage in each country depends on its climate, the structure of its employment and its capacity to adapt. For Ethiopia, where so much livelihood rests on farming, that combination is a difficult one.

The ILO does not treat the outlook as fixed. The study sets out measures that can limit the losses, starting with occupational safety and health rules that include rest breaks during the hottest hours, shaded rest areas and modified work schedules in construction and agriculture. It also calls for stronger social protection and climate-resilient safety nets for informal and outdoor workers whose income falls or stops during heatwaves, and for inclusive social dialogue so that workplace heat policies are designed locally, an approach the article links to Senegal. Governments are urged to build heat-stress projections into national macro-fiscal policy, infrastructure design and sectoral development goals. The study's lead author, Andreas Floris, said that every industry and workplace stands to benefit from proactive adaptation. A Lebanese labour ministry official, Marlene Attallah, added that safeguarding workers directly preserves productivity and working conditions.

The research was commissioned with support from the Climate Vulnerable Forum and the Vulnerable 20 Finance Ministers, and was funded through the CVF-V20 Joint Multi-Donor Fund. The ILO frames protecting workers from rising temperatures as a fundamental investment in health and long-term economic resilience, rather than a cost to be deferred.

The article does not report a response from the Ethiopian government, nor an estimate of how many workers are exposed today, so the practical question of who will fund shade, rest and income protection for outdoor workers remains open.

Why it matters

Heat is usually discussed as a weather story, but this study treats it as a labour story: the loss comes from hours that people cannot safely work. For a country where most livelihoods are outdoors, climate action is also jobs policy, and the cheapest adaptation, shade, rest and schedules, is available now.