Early summer heat and a potentially busy Atlantic hurricane season following an already busy severe weather season could be troublesome for the economy, according to weather risk experts.
Paul Walsh, G2 Weather Intelligence managing director, analyzes weather risk for businesses and said this summer’s forecast could be problematic for businesses and consumers across many industries.
“The forecast for the summer is as risky as I’ve ever seen,” Walsh told FOX Weather.
Walsh said he’s worried most about the summer heat forecast and potential health impacts.
As meteorological summer begins, extreme heat advisories are already popping up across California and the Southwest, where temperatures are forecast to skyrocket into the triple digits this week.
After the heat, Walsh has another reason to be concerned: a potentially busy hurricane season. NOAA issued its most aggressive hurricane season forecast on record for the 2024 season, with potentially 17-25 named storms.
“When you combine all those things, the impacts from both the health effects of the heat waves that we’re seeing, the bad air quality on the back and the potential of wildfires that we’re seeing later this summer, and, of course, the hurricane forecast and the expectation that we could be seeing a record, at least in terms of the number of storms, hurricane season this year – all of it combined to paint a pretty scary summer season as it relates to weather risk,” Walsh said.
As weather extremes can be disruptive across all markets, Walsh said more businesses are entering the weather data market.
“When you think about energy companies and agriculture companies and insurance companies, (they) have all been pretty sophisticated in terms of their use of weather data or weather analytics,” Walsh said. “But more and more companies, like consumer packaged goods companies and retail companies and other companies, pharmaceutical companies, are beginning to use weather data and weather forecasts using what we call seasonal forecasts, like the hurricane forecast, which is a seasonal forecast to help them sort of think about how they better prepare.”
Businesses use technology to stock up before weather events
If there is a silver lining to more weather events, it’s that the technology is improving to forecast weather, and companies are using machine learning or artificial intelligence to become proactive ahead of weather events.
“For example, strawberry Pop-Tarts, which is something that Walmart was famous for talking about how when there’s a hurricane threat, they would run out of strawberry Pop-Tarts, but being able to sort of use data analytics, companies are becoming more precise and understanding what we’re going to be needing with enough advanced knowledge,” Walsh said.
The New York Times reported Walmart began using predictive technology 20 years ago to determine what consumers buy more of ahead of hurricane impacts. It’s one reason the big box chain stocks up on strawberry Pop-Tarts before a tropical system arrives in the U.S.
“We’re getting better at being able to be prepared for these kinds of high-impact events,” Walsh said.
This is what Walsh calls “digital resilience” to be better prepared for extreme weather events that are happening more frequently.
