Opioid Use May Explain 20% of Drop in American Men’s Labor-Force Participation

  • Study by Princeton’s Krueger says crisis intertwined in U.S.
  • Addressing the issue needs to be a ‘national priority’

Why the Fed Cares About the Opioid Epidemic

Opioid use by American men may account for one-fifth of the decline in their participation in the U.S. labor force, according to a study by Princeton University economist Alan Krueger.

“The opioid crisis and depressed labor-force participation are now intertwined in many parts of the U.S.,” Krueger, who was chief economist at the Treasury Department in the Obama administration, wrote in the study released Thursday at a Brookings Institution conference in Washington.

Krueger’s study linked county prescription rates to labor force data from the past 15 years, concluding that regional differences in prescription rates were due to variations in medical practices, not health conditions. In previous research, he found that nearly half of men in their prime worker ages not in the labor force take prescription painkillers daily.

Krueger’s study echoes previous research that attributes most of the decline in labor force participation since the early 2000s to an aging population and young people choosing school over work. The opioid crisis is exacerbating the problem, Krueger wrote.

“Addressing the decades-long slide in labor force participation by prime-age men should be a national priority,” he wrote.

Economists have begun to pay more attention to the spread of prescription painkillers and their link to the historically low portion of prime-age people working. The unemployed are more likely to misuse painkillers, according to test Substance Abuse and Mental Health Administration data, and some end up committing crimes stemming from their addiction that dim their employment outlooks.

“I do think it is related to declining labor-force participation among prime-age workers,” Federal Reserve Chair Janet Yellen said in a July Senate hearing when asked about the crisis. “I don’t know if it’s causal or if it’s a symptom of long-running economic maladies that have affected these communities and particularly affected workers who have seen their job opportunities decline.”

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