06 Feb Prescription Opioids Lead to Decrease in Labor Participation and Increase in Unemployment
MedicalResearch.com Interview with:
Lawrence M. Kessler, PhD Research Assistant Professor
Matthew C. Harris, PhD Assistant Professor
Boyd Center for Business and Economic Research and Department of Economics
The University of Tennessee
MedicalResearch.com: What is the background for this study?
Response: Motivation for this study came from Co-Author, Matt Murray, who was at a speaking engagement and heard a community business leader say “we’ve got jobs, but no one is applying, could opioids be a contributing factor?” This led to a conversation back at the Boyd Center between us and Matt Murray, where we decided that if we could get data on prescription rates, we could answer this question empirically.
We started by contacting each state agency in charge of their respective prescription drug monitoring program to see if they’d be willing to share county-level data on prescription opioid rates. From this letter-writing campaign we received data from 10 states, which formed the basis for our analysis. As time went on, new data was made publicly available and we were able to expand the analysis to all 50 states.
MedicalResearch.com: What are the main findings?
Response: At the county level, a 10% increase in per capita opioid prescriptions leads to nearly a 0.6 percentage point reduction in labor force participation and a 0.1 percentage point increase in the county unemployment rate. This is a really large effect. In fact, prescription opioids may explain up to half of the decline in labor force participation since 2000.
We also find that prescription opioids lead to substantial increases in the unemployment rate as well.
However, what we cannot tell is whether this is due to individuals exiting the labor force purely because of dependence and disengagement, or whether they cannot pass a drug test, or other factors.
MedicalResearch.com: What should readers take away from your report?
Response: The CDC estimates that there were over 47,000 overdose deaths related to opioids in 2017, which in our view is the main reason we should care about the opioid epidemic. But as economists, we looked at the epidemic through a different lens, to see how it affects the economy.
We found that in addition to the very serious adverse health outcomes associated with opioids, there is also this direct negative economic effect where increases in prescription opioids also lead to reductions in labor force participation and increase unemployment which have important consequences in their own right.
When you have conversations about the ‘opioid crisis,’ you often end up surfacing various attitudes, both sympathetic and contemptuous, that people have about addiction and about addicts.
What we want readers to understand is that regardless of their opinions about addiction, that successful rehabilitation of individuals with opioid dependence can yield economic gains.
By extension, these gains benefit the community at large.
MedicalResearch.com: Is there anything else you would like to add?
Response: While we do find that opioids have an adverse effect on the labor market, this does not suggest that restricting the supply of opioids will improve labor outcomes, as many of these individuals have valid medical conditions and need pain management therapy to help them on a day-to-day basis. Additionally, if individuals are exiting the labor force because of opioid dependence, restricting the supply won’t help them get back to work, and may lead them to substitute to other illicit drugs. No disclosures
Prescription Opioids and Labor Market Pains: The Effect of Schedule II Opioids on Labor Force Participation and Unemployment
Matthew C. Harris, Lawrence M. Kessler, Matthew N. Murray and Beth Glenn
January 10, 2019, doi:10.3368/jhr.55.4.0517-8782R1J. Human Resources 0517-8782R1
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