Opioid abuse decimated US workforce: Paper

Where have all the workers gone? That’s the question baffling economists and social scientists for the last decade.

As the labor participation rate for Americans continues to slide lower, a Princeton professor beliefs he has found a contributing factor: Opioid abuse.

“Labor-force participation is lower in areas of the US with a high rate of opioid prescriptions, and labor-force participation fell more over this 15-year period in areas with a high rate of opioid prescriptions,” Alan Krueger wrote in the paper.

Krueger, the former Obama White House economist is not the first to propose this theory of a generation of workers lost to the epidemic of over-subscribed pain killers.

However, in an early version of this paper, Krueger showed data that nearly 50% of America’s between 25- and 54-years old not in the workforce were taking pain killers.

His paper cites the  post-recession decline in the labor-force participation rate—which stands at 62.9% in August, according to the Labor Department data. This number has fallen from 66% in December 2007 and a peak of 67.3% in early 2000.

Many have attributed the decline to aging Baby Boomers retiring, however the data shows that the 60 and older workforce has remained somewhat static as older workers retirement funds were decimated in the 2008 market rout.

It’s also a point to make that as the next generation has fallen out of the workforce, older workers need to stay on since there are little in the way of replacements to fill the job.

While Krueger says the data is not all in yet, he suggests that a further look into this epidemic is warranted, since there may be a cause and effect. “It’s certainly something that deserves serious attention,” he told the Wall Street Journal.

As an aside, I have written on this subject in the past. I see it as a chicken and egg problem. Which came first the loss of a job or the drug abuse?

I maintain that the job loss or fear of it came first. Under Obama, many out of work workers filed for disability for workplace injuries in order to get benefits.

The number of Americans on disability skyrocketed after 2007-2008. Since many claimed pain as the result of the injuries, opioid use also soared. Once hooked, it is very difficult to get off the drugs.

While this is not addressed in the paper directly — as I mentioned earlier the author worked in the White House at the time — I contend that there is also a cause and effect there, with the major drug companies only too happy to churn out millions of pills for the government to pay for through its Social Security disability insurance program.

The real pain is the lost generation of workers and the bill other Americans will have to pay for years.

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One thought on “Opioid abuse decimated US workforce: Paper

  1. Pingback: New paper points to opioid abuse and lost generation of US workers via /r/economy | Chet Wang

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