Recurring extreme temperatures may cut Eurozone output by 0.3-0.5% annually, with risks rising to 0.8% by 2029, per ECB and academic studies.
Recurring European heatwaves are emerging as a persistent drag on Eurozone economic growth, according to macroeconomic research. Studies link extreme temperatures to reduced labor productivity, higher food inflation, and supply chain disruptions, creating a structural downside risk for output.
A 2021 analysis of Europe’s worst heat years found continent-wide GDP losses from productivity declines alone reached 0.3-0.5%, exceeding 1% in highly exposed regions. Additional costs from cooling, healthcare, and infrastructure repairs amplify the impact. A joint ECB-University of Mannheim paper estimated 0.3% output loss in 2025, projecting cumulative damage of 0.8% by 2029.
The findings suggest climate-related disruptions are shifting from temporary shocks to long-term economic headwinds, with implications for growth forecasts and policy responses.