The hidden costs of climate change could cost US businesses hundreds of billions of dollars, slash jobs and kill off niche industries, a new report by the University of Maryland claims.

The research, released last week, showed that without swift and targeted government action, the indirect effects of global warming – such as frequent water shortages, natural disasters, pest infections and poor health – would push up prices and severely impact industry.

While the report said it was impossible to put a specific figure on the economic impact, the cost of property damage due to rising sea levels in Alaska alone could hit between $23bn and $170bn by 2100.

Moreover, it pointed out that while the cost of US storm damage had surpassed $560bn since 1980, more frequent and intense storms caused by pollution would see that figure soar.

"Indirect or secondary economic effects of climate change have rarely been quantified, yet are likely to be substantial", the report entitled The US Economic Impacts of Climate Change and the Costs of Inaction said.

It added: "Increased costs for raw materials, energy and transportation will likely translate into higher prices and a loss of competitiveness that could trigger declines in entire economic sectors or regions."

In particular the report detailed how agricultural firms in New York State alone may experience a 40 per cent drop in earnings, equivalent to about $1.2bn in damages.
Meanwhile, water shortages in California could cost companies $6bn a year; drought in the Midwest region may result in the loss of around 60,000 manufacturing jobs;
and net agricultural income for the San Antonio Texas region is expected to decline by between 16 and 29 per cent by 2030.

Overall the research concluded that the economic impacts of climate change will occur throughout the country, and while those impacts will be unevenly spread and some positive effects will be enjoyed negative climate impacts will outweigh benefits for most sectors that provide essential goods and services to society.

Lead researcher Matthias Ruth, director of the University of Maryland's Center for Integrative Environmental Research, urged the federal government to implement a national policy for immediate action to tackle greenhouse gas emissions. He also called for more research on a region and sector-specific level to help companies adapt to the effects of climate change.