Labor force allocation changes triggered by extreme heat events—Evidence from China

Extreme heat events have compelled enterprises to accommodate the low-carbon requirements of the economy and society, thereby modifying the input and structure of the enterprise labor force. This research, based on data from Chinese A-share listed companies from 2009 to 2022 and matched with city-level extreme heat events, empirically investigates the impact of extreme heat events on enterprise labor allocation from three perspectives: overall effect, industry heterogeneity, and underlying mechanisms. The study discovers that extreme heat events have augmented the labor input of enterprises, among which the proportions of technical positions and highly educated employees have both significantly increased. The impact of extreme heat events on the labor configuration of enterprises presents notable heterogeneity: high-tech industries and heavily polluting industries are more adversely affected. Further mechanism analysis indicates that enterprises primarily enhance the scale of labor demand by expanding the business scope, intensifying green technology innovation, and strengthening the intensity of waste gas regulation. Among them, the expansion of the business scope and the effect of green technology innovation determine the alterations in the labor structure of enterprises, while waste gas regulation driven by high temperatures has no significant effect on the labor structure. The research conclusions of this paper offer policy inspirations for how current Chinese enterprises can cope with extreme heat events and optimize the allocation of their labor force.