NextTech: Mapping the Business Impact of Air Pollution

More than ever, new IoT sensors and mapping technology are showing executives exactly how air pollution affects business—and it can be measured in the trillions of dollars.

The COVID-19 pandemic has had varying effects on air pollution. In many places, shutdown orders have throttled economic activity, causing emissions to drop. Meanwhile, the US EPA temporarily relaxed enforcement of polluting activities during the coronavirus outbreak, even as some areas report persistent poor air quality. And studies are beginning to connect poor air quality with higher death rates from COVID-19. Sometime in the near future, the COVID-19 upheaval will recede, leading to a resurgence in economic activity and a return to normal conditions. Before that time comes, it’s worth examining the cost of pollution.

The impact of poor air quality on the environment and human health is worrying enough: 4.2 million deaths a year occur as a result of exposure to outdoor air pollution, according to the World Health Organization (WHO). Urbanization, a trend moving quickly through Asia and Africa, is accelerating the ill effects of air pollution, which can lead to lung cancer, strokes, and heart disease, among other maladies. Today, 80 percent of urban dwellers are exposed to pollutants that exceed the WHO’s guideline limits, with the highest concentrations in low- and middle-income areas.

Now, economists and data scientists are tracking the costs businesses sustain through disruption to employee health and consumer buying habits. The cost of air pollution in the form of work absence, premature deaths, and years lost from life reached $2.9 trillion in 2018, or about 3.3 percent of global GDP, according to the Centre for Research on Energy and Clean Air. Pollution’s effect on consumer spending is no less startling, with air quality likely influencing billions of dollars’ worth of transactions.

Such troubling metrics have led executives to use a geographic information system, or GIS, to track air pollution, which can vary as much as eight times within the span of a single city block. With location technology decision-makers gain a clearer understanding of where air quality could be hurting employees, customers, and the bottom line.

Air Pollution in Market Analysis

Market development typically involves learning everything about a location—the elements that could impact business success and employee quality of life. That process is now expanding to include air quality considerations.

In the past, the focus has been on demographics of a city or region—learning about the people, their interests and purchasing habits, and whether the area is growing or stagnating. But with IoT sensors and technology like GIS, which displays layers of complex data on smart maps, executives can now also visualize how business health and sustainability may play out. Depending on the industry, air pollution could prove an essential factor in market assessment, on par with consumer brand affinity or access to transportation.

Being able to see the levels of air pollution in a given region, and how they differ from nearby areas, yields clear advantages for business leaders. Those levels can have a direct impact on business health. For example, researchers using GIS and statistical programming recently determined how consumer spending fluctuates in relation to levels of airborne pollutants. Their analysis of data from 12 Spanish provinces showed that consumers were spending $29 million to $48 million less on days when ozone pollution was 10 percent worse. Just a small reduction in ozone pollution and particulate matter pollution, the study found, would result in increased consumer spending of between $19 billion and $30 billion annually. Scale that beyond a dozen Spanish provinces and it’s not difficult to see the amount of business activity at stake.

Making the Invisible Visible

Through a GIS application that reveals worldwide air quality index (AQI) readings, a business executive can add context to decisions such as where to build a distribution center, whether to enlist a new contract manufacturer, and when or where to open a pop-up store. From North America to East Asia, a user can zoom in on a particular region or type in an address and instantly see the AQI ratings.

This short video offers an example of what this NextTech might reveal.

Using this technology, executives can make up-to-date, informed decisions about areas with air pollution. They can protect the health of employees and economic vitality, or even lobby for improvement in places where the company maintains operations. And since pollution can vary dramatically within small areas, planners can add localized datasets to their analysis when it’s time for detailed planning. Monitoring levels of air pollution geographically, in conjunction with factors such as urbanization, can give a company the edge in choosing the safest and most secure spots for business growth.

Powerful Tools for a Complex World

A recent study in the journal Nature underscores the need for tools that condense complex data into an intuitive visual form. The report shows how air pollution can literally be a moving target, traveling like weather across state lines.

Through GIS apps, executives can see simultaneous displays of complex data layers including AQI readings, historical patterns, weather, and IoT-generated real-time feeds. This level of location intelligence supports planning to keep employees, customers, and business operations healthy.