More than 50% of all U.S. counties face ‘heightened future exposure’ to climate change affecting household finances, report asserts

More than half of U.S. counties – populated by millions of Americans – face heightened future exposure to at least one of three climate hazards — flooding, wildfire, or extreme heat – that will affect their household finances, according to a report issued Friday by the Treasury Department.

The report also asserts that about one in five of all U.S. counties face both elevated vulnerability and elevated future exposure to these climate hazards.

According to a release from the Treasury, the report explores the impacts of climate hazards that are climate-related events and conditions that cause harm or damage to people, property, resources, and the environment. The report identifies certain populations and places that may face heightened financial strain due to their vulnerability and exposure to climate hazards, Treasury said.

“Though many households are impacted by climate hazards, certain households are particularly susceptible to experiencing financial strain, for example outdoor workers facing income loss due to adverse climate conditions, single-parent households, particularly those headed by women, facing reduced child care availability, and lower-income households facing reduced access to credit,” a fact sheet on the report states.

The report maintains that households can experience significant financial strain from lost income and higher costs or reduced access to goods and services through widespread physical damage and force interruptions and closures of normal operations of businesses, governments, and other critical services.

The report also argues that households can be affected by climate hazards interrupting households’ ability to manage losses, expenses, and transactions using financial products and services such as credit, insurance, and payments.

The report also pinpoints three regions in the country where exposure to climate change-related can have a severe impact:

  • Flood exposure in Appalachia: Flooding imposes severe financial hardships on Appalachian households by damaging critical infrastructure like roads and bridges, which could potentially reduce access to key community resources like healthcare centers.
  • Wildfire exposure in border regions between the U.S. and Mexico:Households in U.S.-Mexico border areas with outdoor workers face financial strain due to future wildfire exposure, which could result in lost income from foregone working hours.
  • Heat exposure in the Mississippi Delta:Households in the Mississippi Delta face financial challenges due to future extreme heat conditions, as resulting heat-related illnesses can necessitate added spending on healthcare.

The impact of climate change on American household finances