Many Americans are too drugged-out to work
The reports suggest a circularity to the crisis in America’s rust and manufacturing belts: the loss of jobs and wage stagnation has led to widespread disaffection, alienation and drug abuse; and drug abuse has led to joblessness, hopelessness and disaffection.
But the anecdotal and economic evidence is compelling.
- LinkedIn’s Chip Cutter found a West Virginia company where “up to half of applicants either fail or refuse to take mandatory pre-employment drug screens.” The executive of another company called the drugs epidemic “probably the biggest threat in manufacturing, period.”
- “In Congressional testimony earlier this month,” Cutter writes, “Federal Reserve chair Janet Yellen related opioid use to a decline in the labor participation rate. The past three Fed surveys on the economy, known as the Beige Book, explicitly mentioned employers’ struggles in finding applicants to pass drug tests as a barrier to hiring.”
One hopeful note: In a note to clients on July 5, Goldman Sachs’s Jan Hatzius said a hard look does not show that the current unemployed are in fact permanently unemployed. “We see little basis for writing off the remaining pool of unemployed, whose rate of drug use has not risen nearly as much as one might think from the surge in drug deaths,” the note said.