Daylight Savings Time: Financial Benefits of the Time Change


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Despite obvious inconveniences, Daylight Savings Time may have positive effects for the economy. Image credit: Benito LeGrande

The clocks have changed once again. Apart from the obvious effects on sleep and our everyday activities, what does Daylight Saving Time offer the economy?

Financial Rewards

Increasing the number of waking hours in which natural daylight is available can have a surprisingly impactful effect on energy consumption and, therefore, spending.

For every additional hour of daylight, there is a reduction of one hour in the time we need to spend lighting (and, often, heating) our homes and workplaces.

Groundbreaking studies in Japan (2004) which remain the most important to date concluded that the immediate effects of Daylight Saving Time include a reduction in electricity used equivalent to the power that would be used by the whole country watching TV for 66 days.

This translates into an economic impact of 970 billion yen (over $1 million).

The impact of such reductions in energy usage are not beneficial not just for home-based users, and cause ripples not only in the fuel economy, but the financial world as a whole. Heating and lighting an office for a reduced amount of time can lead to an important decrease in business overheads, resulting in an not insignificant effect on individual business accounts and profitability. Business ventures that are reliant on good, light conditions outdoors – particularly those in the tourism industry – undoubtedly benefit from increased business hours during longer and lighter days in the summer.

DST: Long-Term Economic Benefits

Consequences of increased daylight that appear to be nothing more than social benefits of the scheme, such as the lowered risk of crime or road accidents, can, in fact, be directly converted into significant financial boosts for the overall economy. If crime levels in decrease in lighter evenings, police resources are under less of a strain, and fewer paid man hours are required to police affected areas. Likewise, if road traffic accidents are reduced, the costs of repairing both roads and vehicles, and paying insurance, are lowered greatly, meaning savings in a variety of industry sectors.

Daylight Savings Time?

For individuals, the savings may not amount to much, and the inconveniences of adjusting to the new times influence many in their decision to support movements to end Daylight Saving Time permanently. However, small ‘Daylight Savings’ for an individual household or business equate to large energy and financial savings for every state and country involved. We should consider the real impact of the reduction of this energy use, were serious moves ever made to abolish the scheme entirely.


Japan Productivity Center. Summer Time as a Means to Lifestyle Structural Reform. (2004). Accessed November 2012.

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