AUSTIN, Texas — The summer heat in Texas was so intense that it might have caused a decrease in the state's overall GDP, according to a new research finding from the Federal Reserve Bank of Dallas.
The report found that the record-breaking heat that persisted throughout the summer likely reduced Texas’ GDP by 1%, or as much as $24 billion, because some companies had a more difficult time supplying goods while people were spending less.
“Anecdotally, everyday behavior in Texas changed during the summer of 2023 as the heat bore down,” the report stated.
The report also found that the impact of the heat on Texas' GDP growth was twice as impactful as it was on the rest of the country.
The report also noted that the rising summer temperatures also had an effect on job growth, albeit with a more subdued impact than the effect on the GDP.
The report wasn't entirely negative. Researchers did note a more prominent spring and more temperate fall and winter temperatures spur economic activity, with a particular positive effect on the state's agricultural and real estate industries.
However, as the number of 100-degree days is expected to almost double by 2036 compared to the previous two decades, especially in urban areas, the report advised that local industries make long-term adaptations to their summer operations.
“As climate change’s effects intensify over the next decades, heat waves will become more commonplace and severe,” researchers said in the report. “However, the economy can adapt.”