Cleveland Fed researches opioid impact on region’s economy

Research by the Cleveland Federal Reserve Bank concludes that opioid abuse causes economic conditions to decline and abuse rates do not go up as a result of downturns in the economy (Source: “Cleveland Fed researches opioid economic impact,” Canton Repository, June 1, 2018).

Researchers found that prime-age men and women in areas with higher opioid prescription rates were less likely to participate in the labor force and have jobs from 2006 to 2016. The difference was nearly 5 percentage points for men and 1.4 percentage points for women between areas with the highest and lowest prescription rates. “That’s effectively like doubling your unemployment rate,” said Mark E. Schweitzer, the Cleveland Fed’s senior vice president of research and community development.

Cleveland Fed surveys of regional businesses, economic development agencies and social service providers showed that opioid use made it harder for companies to find workers who could pass drug tests and strained social services, such as foster care and addiction treatment.

But when researchers looked at data from the Great Recession, they found opioid use during that time remained stable despite a tough economy.

The Cleveland Fed is one of 12 regional Federal Reserve Banks, and its district covers Ohio, western Pennsylvania, eastern Kentucky and the northern panhandle of West Virginia, a region that has been hit hard by the opioid crisis.

Schweitzer said the research doesn’t say that ending opioid prescriptions would send everyone back into the labor force. Nor did the research consider the rise of illegal, synthetic opioids such as fentanyl. The paper also cautioned against the idea that an improved economy would solve drug abuse issues.