Nature and Biodiversity

How does the weather affect the economy?

Geraint Johnes
Professor, Lancaster University
Our Impact
What's the World Economic Forum doing to accelerate action on Nature and Biodiversity?
The Big Picture
Explore and monitor how United Kingdom is affecting economies, industries and global issues
A hand holding a looking glass by a lake
Crowdsource Innovation
Get involved with our crowdsourced digital platform to deliver impact at scale
Stay up to date:

United Kingdom

The Office for National Statistics has produced a report on sales of popular summer-related products. Official data on sales of goods are limited in that they tend to be based on annual spending, but clearly the demand for some products tends to be seasonal. Various cold drinks, meat (for barbecues) and ice cream are identified as typical examples.

While we do not have official data on the extent to which demand for these goods varies over the year, unofficial data allow us to learn a little more about the extent to which a good (or a bad) summer can affect demand.

A major UK ice cream producer reports that some 68% of its revenue is earned in the second and third quarters of the year. Using this figure alongside typical monthly temperatures in the UK allows us to establish that a 1% increase in temperature results in a 1.2% rise in the demand for ice cream. An August in which temperatures are one degree hotter than usual therefore likely results in a 6% increase in ice cream sales during that month.

UK manufacturers’ ice cream sales, 2008-2014

Data from Information Resources Inc compare UK demand for cold alcoholic drinks in the two week period to July 20 2013 with that of the corresponding period in the previous year. Data on temperatures near the geographic centre of the UK for these periods indicate that, in 2013, the average was 20.6°C, while in 2012 it was just 15.7°C.

Index of sales of selected beverages compared with UK mean average temperature, 2008 to 2014.

Of course, other factors – especially economic factors – are likely to affect demand too. Abstracting from these, however, a 1% increase in temperature seems to be associated with an increase in demand of around 2.4%. An August in which temperatures are 1°C hotter than usual would therefore lead to an increase in demand of around 12%. This should be regarded as an upper bound in view of the fact that some of the increase in demand between 2012 and 2013 might have been due to changes in general economic conditionsrather than changes in temperature.

The analysis of seasonal effects is particularly difficult in the case of meat, not least because different types of meat are popular at different times of the year. The demand for sirloin may be relatively high in the summer, but the demand for roasting joints is relatively low at that time of year. Overall, statistics on meat production do not indicate any substantial increase in the summer – indeed the peaks for sheep and pig meat come later in the year.

Other types of summer-related goods include garden furniture, barbecues and air conditioners. But since these are durable goods, consumers benefit from them over the course of several summers, some of which will be hotter than others. We would expect people to average out across several years their likely use of these products, and so purchases of such goods should not be unduly sensitive to a heatwave in any one year.

Evaluating the economic impact of summer has much in common with attempts to measure the effects of major events. Typically the expenditure that is associated with an event (be it the Olympics or a heatwave) is diverted rather than created – and it matters where it is diverted from and where it is diverted to. If we spend more on beer but less on coffee, the aggregate effect on the UK economy is likely to be small. If, however, we spend more on domestic holidays and less on going abroad to chase the sun, the economy will benefit.

As the above figures indicate, for the producers of at least some summer-related goods, a good summer can be good in more senses than one. But an important catch in all of this is that much of the increased expenditure on summer related products is mirrored by decreased spending on other things.

For every ice cream that is eaten, a hot chocolate may be eschewed. So – tempting as it might be to try and calculate a figure for the economic value of a hot summer – adding up extra sales revenues for these products is not really a particularly instructive exercise. Indeed, the true value of a summer is most likely captured by the feelgood factor that a little sunshine brings, so enjoy it while you can.


This article is published in collaboration with The Conversation. Publication does not imply endorsement of views by the World Economic Forum.

 To keep up with the Agenda subscribe to our weekly newsletter.

Author: Geraint Johnes is a Professor of Economics at Lancaster University.

 Image: A satellite image of clouds is seen. REUTERS. 

Don't miss any update on this topic

Create a free account and access your personalized content collection with our latest publications and analyses.

Sign up for free

License and Republishing

World Economic Forum articles may be republished in accordance with the Creative Commons Attribution-NonCommercial-NoDerivatives 4.0 International Public License, and in accordance with our Terms of Use.

The views expressed in this article are those of the author alone and not the World Economic Forum.

Related topics:
Nature and BiodiversityGeo-Economics and PoliticsEconomic Growth
World Economic Forum logo
Global Agenda

The Agenda Weekly

A weekly update of the most important issues driving the global agenda

Subscribe today

You can unsubscribe at any time using the link in our emails. For more details, review our privacy policy.

5 ways sustainable forestry can support climate action, development and biodiversity

Charlotte Kaiser

April 23, 2024

About Us



Partners & Members

  • Join Us

Language Editions

Privacy Policy & Terms of Service

© 2024 World Economic Forum