This paper isn’t conclusive. First of all, the authors’ measure of temporary changes in labor demand could have statistical problems that make it unreliable for this sort of measurement. Second, the effect of weak labor markets on drug use might be longer term -- people who think they’ll be unemployed only briefly might not turn to drugs, while people who see no prospects might start using heroin or fentanyl. Although the authors try to control for long-term labor market conditions, there’s always the chance they’ve missed something.
Nonetheless, evidence is piling up that the opioid epidemic is eroding the foundations of the U.S. economy by impairing the labor force. It’s a problem that policymakers need to address urgently.
Although President Donald Trump has declared the epidemic a national emergency, he hasn’t done much to address it. For one, he should stop trying to cut Medicaid benefits, which help addicts receive needed treatment. Government health insurance should be expanded, not shrunk. Legalizing marijuana at the federal level would help, too -- legalization has been found to lower opioid use.
It will be a generation before the impact of the horrendous opioid epidemic fades from the national statistics. But with the right steps now, the U.S. might at least be able to end it more quickly.
This article provided by Bloomberg News.