KNOXVILLE, Tenn. — The high rates of opioid prescriptions are leading to higher unemployment rates and lower labor force participation overall, according to a study by researchers at the University of Tennessee at Knoxville.
The study examined county-level data from across the United States and found that a 10% increase in opioid prescriptions led to 0.6% decrease in labor force participation and a 0.1% increase in unemployment rates.
Co-author Matt Harris, assistant professor of Business and Economic Research at Tennessee, called the study the first of its kind to be published in a peer-reviewed journal. While the percentages may seem small, the researchers say otherwise.
“The effects are really large,” Harris says in a media release. “Prescription opioids may explain up to half of the decline in labor force participation since 2000.”
Harris and the team of economists studied the relationship between opioid prescriptions and labor markets after they wondered why, in some areas, job postings are going unanswered. Since there seems to be a stronger link between labor force participation and opioid prescriptions than unemployment rates, the authors believe that opioids are pushing people out of the labor market altogether.
“We found that opioids have this strong adverse effect on labor force participation but only a marginally significant effect on the unemployment rate, which leads us to believe that opioids are leading individuals to exit the labor force entirely,” says co-author Larry Kessler.
Interestingly, the study showed that opioids were most damaging in counties with higher labor force participation rates and lower unemployment rates. The finding suggests that could mean areas with low labor force participants have already been affected by the growing opioid crisis.
Tennessee has one of the highest number of heavy opioid-prescribing practitioners in the country. Health care providers in the state write 1.4 opioid prescriptions per person per year, equivalent to prescribing 80 opioid doses to everyone living in Tennessee every year.
“The results suggest that in Tennessee, you could effectively boost income among residents by $800 million per year if you reduce opioid usage 10 percent,” argues Harris.
Should officials put more funding and effort into reversing the trends and ending the epidemic, the authors say that in addition to saving lives, there’d be a notable gains in the economy.
The study was published in The Journal of Human Resources.