Working Paper: NBER ID: w29932
Authors: Jeremy Greenwood; Nezih Guner; Karen Kopecky
Abstract: The labor-force participation rates of prime-age U.S. workers dropped in March 2020—the start of the COVID-19 pandemic—and have still not fully recovered. At the same time, substance-abuse deaths were elevated during the pandemic relative to trend indicating an increase in the number of substance abusers, and abusers of opioids and crystal methamphetamine have lower labor-force participation rates than non-abusers. Could increased substance abuse during the pandemic be a factor contributing to the fall in labor-force participation? Estimates of the number of additional substance abusers during the pandemic presented here suggest that increased substance abuse accounts for between 9 and 26 percent of the decline in prime-age labor-force participation between February 2020 and June 2021.
Keywords: substance abuse; labor force participation; COVID-19; opioids; methamphetamine
JEL Codes: E24; I12; J11; J21
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| increased substance abuse during the pandemic (I12) | decline in labor force participation rates among prime-age workers (J21) |
| opioid and methamphetamine users (I12) | significantly lower labor force participation rates (J21) |
| increased substance abuse (I12) | additional individuals out of the labor force (J49) |
| increased substance abuse (I12) | significant impact on labor force participation (J21) |