Understanding the human cost of extreme weather

Climate change is threatening the safety and well-being of the residents of Canada with more frequent and intense extreme weather, such as wildfires, floods, and heat domes. Extreme weather events exacerbated by climate change are expected to cost Canada $25 billion next year, accounting for half of the projected GDP growth for 2025.¹ Likewise, a recent KPMG survey of 350 Canadian business leaders found that 92 per cent fear that the extreme weather events over the last year are the new normal and that their organization will be hit by a climate-related event this year.²

Extreme weather events cause not only physical and economic damage, but also significant social impacts on the affected communities, such as displacement, health problems, mental distress, and loss of livelihoods. Some groups, such as Indigenous communities, low-income households, older adults, and newcomers, are more vulnerable to these impacts due to existing inequities and barriers. For example, First Nation and Indigenous communities make up 42% of wildfire-related evacuations,³ with studies revealing that fire-related mortality between 2011 and 2018 was five times more likely among Indigenous (vs. non-Indigenous) people.⁴ As well, adults over the age of 65 in Canada’s largest cities have a higher-than-average risk of death due to heat waves.⁵

Based on a report by KPMG International, Standard Chartered and the United Nations, for every $1 invested in climate adaptation efforts, an economic benefit of $12 can be generated.⁶ To build resilience against climate change-induced disasters, public sector organizations need to adopt proactive and equitable strategies that address the needs and perspectives of the most vulnerable communities.

This involves comprehensively assessing the risks and impacts of climate disasters recognizing that the impacts go beyond the physical environment, and also affect economic and social livelihood. Assessing these risks and working proactively to reduce their impacts involves applying a lens of social equity, engaging with stakeholders using a trust-based approach to understand their unique needs, developing and implementing tailored solutions, and monitoring and evaluating the outcomes.

Wildfires cause physical, economic, and social damage to people and communities

Wildfires, exacerbated by climate change, can destroy homes, infrastructure, businesses, and public services, forcing people to evacuate, disrupting their livelihoods, and affecting their health and well-being. In 2023, the city of West Kelowna witnessed one of the fastest-spreading wildfires in British Columbia’s history, causing $480 million in damages to physical assets.⁷ Similarly, in June of 2023, the healthcare costs from wildfire smoke in Ontario were estimated at $1.28 billion, with healthcare costs in Ottawa alone accounting for $467 million.⁸ In 2023, a staggering 185,000 individuals were forced from their homes, marking the highest number of wildfire displacements in Canada since records began in 2008.⁹

Wildfires also have broad and long-term impacts that go beyond the fire's path

Employment opportunities can dwindle in impacted regions, causing a surge in unemployment rates. Local economies, particularly those dependent on tourism or forestry, also face a slow and arduous path to recovery. For instance, wildfire activity in one region can cause constrained timber supply, such as the 20% reduction in Canadian lumber production seen during the 2023 wildfire season.¹⁰ The constrained supply does not only affect local markets by increasing lumber prices and decreasing business revenues, but also jeopardizes Canada’s capacity for global lumbar supply.¹¹

Beyond economic impacts, the consequences of wildfire activity have implications for local migration patterns. A recent survey found that more than a third of Canadian homeowners consider climate change-induced risks and disasters when purchasing a property. This is a particularly growing concern among young home buyers, who are much more likely (sixty-four percent) to factor in climate risks in their buying decisions.¹²

Wildfires’ impacts are felt by all but may disproportionately affect vulnerable groups and intensify social inequities

• Indigenous communities face significant exposure to wildfires, with sixty to seventy percent of reserves falling in high-risk areas along the urban-rural interface.^13,14 The risks they face include increased displacement, respiratory and physical ailments due to smoke, and issues stemming from the destruction of land (hunting grounds and sacred sites) from wildfires – including loss of food supply, cultural practices and heritage.
• Low-income households may struggle investing in fireproofing or accessing resources needed during evacuations.¹⁵ These households may also face a more difficult economic recovery period when their physical homes are destroyed, as they are likely to contain most of their assets and valuables, placing the burden on them to replace or recoup the value of their lost belongings.
• Newcomers to Canada may face additional challenges due to lack of health insurance and language barriers that may impede their ability to receive wildfire evacuation information in a timely fashion.¹⁶ Newcomers may also be less aware of wildfire risks in Canadian communities to begin with, resulting in less capacity to adequately prepare.
• Senior citizens are often more susceptible to experiencing negative health effects of wildfire smoke and face additional challenges during evacuations due to limited mobility, health conditions, and social isolation.¹⁷

Floods cause physical, economic and social damage

Floods not only affect buildings, infrastructure, power, water, and communication networks, but they also carry downstream implications on local businesses and the economy. Businesses may be forced to shut down their operations because of structural damage, or damage to roads and railways that affect their supply chain. Last summer, Nova Scotia was hit by the heaviest rainfall the province had seen in over 50 years, triggering devastating flooding across multiple areas. The flooding caused roads to wash away and over 80,000 residents to lose power.¹⁸ Each flooding disaster from the last decade has roughly averaged $30 million of insured losses, with the total annual insured losses amounting to $800 million.¹⁹ This number is expected to increase as heavy rainfalls, extreme storms, and the melting of polar ice caps become more frequent causing more flooding events in Canada over the next 30 to 60 years.^20,21

The long-term impacts of floods

Floods pose long-term health risks to the affected communities, as floodwaters can be contaminated with sewage and other dangerous materials increasing the risk for water borne diseases.²² Floodwaters are also a fertile ground for disease-carrying mosquitos. Indoor air quality is a major concern in impacted buildings, which stay damp and pave way for mold and bacterial growth, causing illness and increased hospitalizations.

Floods impact some populations more than others

In addition to the uniform challenges of facing issues such as social isolation, lack of insurance, access to emergency services, and repeated displacement:

• Older adults may face health and mobility challenges during and after floodings
• Low-income and single-parent households may lack social and financial support to cope with floodings.²³
• Indigenous communities are often exposed to high and repeated flood risks, and can suffer from displacement, food insecurity, mental health issues, and inadequate resources and funding.²⁴ For example, due to shortage in suitable housing, many of the Peguis First Nation residents affected by floodings during 2014, 2017 and 2022 are still displaced and unable to return to their homes.²⁵
  

Canada is warming at twice the global rate

In 2021, the Province of British Columbia experienced what was once a once in a millennium heat dome, reaching 49.6 °C in certain areas (the highest temperature ever recorded in Canada), and claiming the lives of 619 residents over approximately one week. If the planet warms by 2°C, an event like this is estimated to occur roughly once every 5 to 10 years.²⁶

The economic impact of heat domes

Heat domes can exacerbate the urban heat island effect, which makes the central and interior areas of cities hotter than the surrounding areas, due to the lack of green space, the presence of heat-absorbing surfaces, and the vehicle-generated heat.²⁷ This can reduce the comfort and well-being of urban residents and increase the need for cooling and ventilation. For example, over 75% of BC Hydro’s top 25 daily electricity peaks were experienced during the 2021 heat dome.²⁸

Heat domes can also impair the productivity and safety of workers, especially those who work outdoors or in non-air-conditioned environments, such as farmers, construction workers, and unhoused individuals. They can also expose workers to potential labor rights violations, such as inadequate protection, compensation, or breaks. Accessing cooling during extreme heat waves is a human rights issue, and public and private sectors have the responsibility to ensure the welfare of their workers and customers.²⁹

The social inequities exacerbated by heat domes

Extreme heat can cause health impacts to anyone exposed such as heatstroke, dehydration, and other complications, leading to increased demand for emergency and healthcare services – which can overwhelm the system and the workforce. Heat domes can also intensify existing inequities, creating an urgent need for climate resilience strategies that address the social risks to those most vulnerable to their impacts, including older adults, people with physical disabilities, pregnant women, those with mental health conditions, and / or low income.

Building climate resilience and minimizing potential impacts requires a holistic and customized approach for organizations to understand the pertinent risks, impacts, and possible solutions. In doing so, organizations can minimize their exposure to and build resilience against climate risks. This non-siloed approach to climate resilience increases the capacity for developing effective infrastructure and community planning strategies that simultaneously consider multiple climate risks and long-term impacts.

• How are you comprehensively assessing your climate risks, including the social risks, to understand potential impacts on your operations and financial performance?
• Have you considered the impacts of climate change on all your key stakeholders, including your workforce, supply chain, customer base, and broader community?
• What social considerations are you factoring in while building your climate resilience plan? (e.g., social equity frameworks and impact assessment tools, co-design principles, community capacity-building frameworks, accountability structures, etc.)
• How are you building trust with communities and stakeholders most impacted by climate disasters to facilitate communication and the co-design of solutions?

Our environmental and social sustainability subject matter experts can help organizations at any stage of their climate risk and resilience journey, from conducting comprehensive risk and impact assessments, to planning resiliency and adaptation actions, building the business case, and executing effective climate action initiatives. Our passionate professionals support organizations in building trust and confidence with key stakeholders, including the communities they serve, by facilitating co-creation of solutions and providing targeted support and resources.