Outdoor air quality is at the forefront of policy agendas and decision-making, but should policymakers and businesses care more about indoor air quality?
Key takeaways
- Improved workplace air quality through a 95% reduction in indoor pollution could boost London employees’ productivity by up to 15%.
- That could deliver an additional £38bn of economic activity to the London economy, boosting overall output by between 4% and 8%.
- Similar positive outcomes were seen for LA, Singapore, Sydney and Barcelona.
Air pollution and its impacts on both the environment and health are quickly becoming one of the most critical issues to businesses and policymakers worldwide. A wealth of research links air quality to short- and long-term health issues, but its impacts on the economy are less well understood. So CBI Economics carried out new analysis to understand its effects in the workplace, and how this translates throughout the economy.
Health effects have rightly placed pollution at the forefront of political and economic agendas. Although the debate has somewhat shifted in the UK recently, policymakers globally have recognised environmental challenges through measures ranging from low emission zones and transport electrification to renewable energy investment and emissions trading schemes.
But this policymaking almost exclusively focusses on outdoor air quality, when the air we breathe indoors is no better, and sometimes even worse. Harmful outdoor pollution seeps indoors through our ventilation systems and windows, as indoor environments play host to particulate matter (PM), volatile organic compounds (VOCs) and CO2. This pollution is worsened by additional indoor sources.
We spend around 87% of our lives indoors. This will only increase further with modern lifestyle patterns. And the Covid-19 pandemic and health campaigns have brought even more attention to indoor air due to the higher transmission of pathogens compared to outdoors. Indoor air quality is therefore a crucial issue that deserves more attention in both research and policymaking.
Both businesses and their employees have reason to strive for cleaner air in their workplaces
The World Health Organisation has labelled indoor air quality as “the world’s largest single environmental health risk”, as these well-established health impacts filter through extensively to our workforce. Better workplace air quality and a healthier workforce carries substantial benefits for both businesses and their employees, improving workplace satisfaction, employee wellbeing, company reputation and productivity.
Our modelling and analysis of the economic impacts of cleaner indoor air draws from these significant productivity effects, which benefit through multiple channels:
- Absenteeism: A healthier workforce breathing cleaner indoor air is less likely to take absence from work due to severe health problems, either for personal sickness or caring for relatives;
- Presenteeism: Healthier workers are also less likely to display more minor illnesses and symptoms that may impair in-work productivity.
Improving indoor air quality could therefore deliver substantial individual productivity benefits, which collectively boost organisation performance, and stack up even wider to uplift overall economic output.
Improving workplace air quality produces benefits that materialise from individual workers all the way up to city-wide economies throughout the globe.
CBI Economics comprehensively analysed these economic impacts, modelling for improved workplace air quality through a 95% reduction in indoor pollution which can be achieved through improved ventilation and air purification.
We found that improving office air quality can generate significant benefits for individuals, boosting London employees’ productivity by up to 15%. In monetary terms, this translates to an additional £17,400 of output per worker. The health and productivity benefits can also lead to overall improvements in employee wellbeing and earnings potential, highlighting the importance of a healthy work environment. For businesses, reduced absences from work and increased employee productivity and wellbeing can also translate to increased innovation, staff retention and ultimately higher revenues. Improving air quality in the workplace can therefore be a worthwhile endeavour as part of broader plans to create a healthy office environment, particularly if staff are to be convinced to forego home working in favour of returning to the office.
These benefits potentially accumulate even further to impact entire local economies. Scaling up to a city-wide level, improved air quality throughout all offices could deliver an additional £38bn of economic activity to the London economy, boosting overall output by between 4% and 8%.
Figure 1: Individual productivity impacts of improved office air quality in London
Source: CBI Economics analysis (2023)
By the same principles, other cities around the world could also observe similar, or even greater, benefits, depending on the levels of outdoor pollution they experience and the levels of ventilation within their offices. Cities like Singapore, Sydney, Los Angeles (LA) and Barcelona could boast huge benefits from improving indoor air quality, particularly in the warmer months of the year and during extreme climate events, such as wildfires.
Our analysis shows that cleaner workplace air could boost individual productivity by at least 17% in all four cities mentioned above, amounting to as much as £37,600 of additional output per worker in LA. Similar to London, these benefits can accrue to enormous economy-wide impacts: both Barcelona and LA could see uplifts of almost 8% in their city economies, translating to an additional £43bn of output in the latter.
Figure 2: City-wide economic impacts of improved office air quality (relative and absolute output growth)
Source: CBI Economics analysis (2023)
Could your organisation benefit from CBI Economics’ rich experience building robust evidence bases around the economic benefits of clean air?
CBI Economics’ experience in clean air modelling extends past this commercial analysis around indoor air quality, successfully delivering past research centred on outdoor air quality and political audiences. In partnership with the Clean Air Fund, we previously found the UK economy could benefit to the tune of £1.6bn each year if it were to achieve WHO air quality guidelines, preventing 17,000 deaths annually. This work attracted media coverage in Sky News and The Guardian, while garnering positive reaction from political stakeholders like the Mayor of London and the APPG on air pollution. CBI Economics collaborated with the Clean Air Fund again to demonstrate the economic impacts of ‘Clean Air Zones’ in 8 UK cities. Benefits ranged from £0.5m in Portsmouth up to £48m in London, as this work resonated with media outlets like The Times and ITV and was broadcast on 11 regional programmes.
About CBI Economics:
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