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Opioids and Post-COVID Labor-Force Participation

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Listed:
  • Francesco Chiocchio
  • Jeremy Greenwood
  • Nezih Guner
  • Karen A. Kopecky

Abstract

At the onset of COVID-19, U.S. labor-force participation dropped by about 3 percentage points and remained below pre-pandemic levels three years later. Recovery varied across states, with slower rebounds in those more affected by the pre-pandemic opioid crisis, as measured by age-adjusted opioid overdose death rates. An event study shows that a one-standard-deviation increase in pre-COVID opioid death rates corresponds to a 0.9 percentage point decline in post-COVID labor participation. The result is not driven by differences in overall health between states. The effect of prior opioid exposure had a more significant impact on individuals without a college degree. The slow recovery in states with more opioid exposure was characterized by an increase in individuals who are not in the labor force due to disability.

Suggested Citation

  • Francesco Chiocchio & Jeremy Greenwood & Nezih Guner & Karen A. Kopecky, 2025. "Opioids and Post-COVID Labor-Force Participation," Working Papers 25-13, Federal Reserve Bank of Cleveland.
    • Handle: RePEc:fip:fedcwq:99976
    DOI: 10.26509/frbc-wp-202513
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    More about this item

    Keywords

    labor-force participation; health; opioids; COVID-19;
    All these keywords.

    JEL classification:

    • I12 - Health, Education, and Welfare - - Health - - - Health Behavior
    • I14 - Health, Education, and Welfare - - Health - - - Health and Inequality
    • J11 - Labor and Demographic Economics - - Demographic Economics - - - Demographic Trends, Macroeconomic Effects, and Forecasts
    • J12 - Labor and Demographic Economics - - Demographic Economics - - - Marriage; Marital Dissolution; Family Structure
    • J21 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Force and Employment, Size, and Structure

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