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Did Substance Abuse during the Pandemic Reduce Labor Force Participation?

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  • Jeremy Greenwood
  • Nezih Guner
  • Karen A. Kopecky

Abstract

The labor force participation rates of prime-age US workers dropped in March 2020—the start of the COVID-19 pandemic—and have still not fully recovered. At the same time, deaths from substance abuse were elevated during the pandemic relative to trend, indicating the number of people abusing substances may have increased, and those who abuse opioids and crystal methamphetamine have lower labor force participation rates than those who don’t abuse these substances. Could increased substance abuse during the pandemic be a factor contributing to the fall in labor force participation? Estimates of the number of additional people with a substance-use disorder during the pandemic presented in this article suggest that increased substance abuse accounts for between 9 percent and 26 percent of the decline in prime-age labor force participation between February 2020 and June 2021.

Suggested Citation

  • Jeremy Greenwood & Nezih Guner & Karen A. Kopecky, 2022. "Did Substance Abuse during the Pandemic Reduce Labor Force Participation?," Policy Hub, Federal Reserve Bank of Atlanta, vol. 2022(5), May.
    • Handle: RePEc:fip:a00068:96682
    DOI: 10.29338/ph2022-05
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    References listed on IDEAS

    as
    1. Ariel J. Binder & John Bound, 2019. "The Declining Labor Market Prospects of Less-Educated Men," Journal of Economic Perspectives, American Economic Association, vol. 33(2), pages 163-190, Spring.
    2. David M. Cutler & Edward L. Glaeser, 2021. "When Innovation Goes Wrong: Technological Regress and the Opioid Epidemic," Journal of Economic Perspectives, American Economic Association, vol. 35(4), pages 171-196, Fall.
    3. Karen A. Kopecky, 2011. "The Trend In Retirement," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 52(2), pages 287-316, May.
    4. repec:fip:a00001:94153 is not listed on IDEAS
    5. Katharine G. Abraham & Melissa S. Kearney, 2020. "Explaining the Decline in the US Employment-to-Population Ratio: A Review of the Evidence," Journal of Economic Literature, American Economic Association, vol. 58(3), pages 585-643, September.
    6. Casey B. Mulligan, 2022. "Lethal Unemployment Bonuses? Substitution and Income Effects on Substance Abuse, 2020-21," NBER Working Papers 29719, National Bureau of Economic Research, Inc.
    7. David M. Cutler & Edward L. Glaeser, 2021. "When Innovation Goes Wrong: Technological Regress and the Opioid Epidemic," NBER Working Papers 28873, National Bureau of Economic Research, Inc.
    Full references (including those not matched with items on IDEAS)

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    Cited by:

    1. Angelo Leogrande & Alberto Costantiello, 2023. "The Labor Force Participation Rate in the Context of ESG Models at World Level," Working Papers hal-04114330, HAL.

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    More about this item

    Keywords

    COVID-19 pandemic; substance abuse; labor force participation;
    All these keywords.

    JEL classification:

    • I12 - Health, Education, and Welfare - - Health - - - Health Behavior
    • J11 - Labor and Demographic Economics - - Demographic Economics - - - Demographic Trends, Macroeconomic Effects, and Forecasts
    • J21 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Force and Employment, Size, and Structure

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