This past October, the Society of Actuaries Mortality and Longevity Strategic Research Committee, in conjunction Millman, published a report titled “Economic Impact of Non-Medical Use in the United States”.
According to the report, the overall estimated cost of the opioid crisis to the U.S. economy has been $631 billion for the four-year period 2014 to 2018. The impact to the following areas of the economy has been:
- Healthcare: $205 billion
- Premature mortality: $250 billion
- Lost Productivity: $96 billion
- Criminal Justice Activities: $39 billion
- Child and Family Assistance and Education: $39 billion
Low and high cost estimates are projected in the report for 2019, ranging from $172 billion to $214 billion, and the costs of non-medical use of opioids are expected to continue to grow in future years.
The report provides detailed cost estimates by year and for sub-categories of the above areas of the economy.
More specific to Colorado, the American Action Forum produced an analysis of the impact of the opioid crisis on Colorado’s labor force participation. The report found that a loss of millions of hours slowed the state’s economic growth by 0.5 percent between 1999 and 2015.
According to the American Action Forum:
As the number of individuals absent from the labor force due to opioids grew, Colorado’s economy lost an increasing number of work hours. Between 1999 and 2015, Colorado cumulatively lost a total of 360 million work hours. Since opioid dependency led more women out of the labor force than men, the majority—56 percent—of the lost work hours was attributed to Colorado’s decline in female labor force participation. Specifically, the state’s economy lost 200 million work hours due to absent female workers, and lost 160 million work hours due to absent male workers.
This opioid-induced loss in female labor participation translated into a substantial loss to Colorado’s economy, estimated as a cumulative loss of $11.7 billon between 1999-2015, slowing Colorado’s real GDP growth rate by 0.3 percentage points. The decline in male workers cost Colorado’s economy $9.3 billion, which reduced the state’s real GDP growth rate by 0.2 percentage points.
The American Action Forum analysis concludes:
From 1999 to 2015, Colorado’s economy cumulatively lost $21.0 billion in real economic output, which translates to the state’s annual real GDP growth rate slowing by 0.5 percentage points. To put this loss in perspective, from 1999 to 2015, Colorado’s real GDP grew 2.1 percent annually. Had opioids not drawn 27,400 prime-age workers out of the labor force, the state’s economy would have grown about one-fifth faster.
In Colorado, a concerted effort is underway to bend the arc of the opioid crisis. The momentum of the crisis is daunting and will take many years to subdue. The progress made to mitigate its impact is expected to have a benefit to Colorado’s future economy in addition to the lives and livelihood of the residents of our state.
José Esquibel serves as associated director of the Center for Prescription Drug Abuse Prevention and director of the Colorado Consortium Prescription Drug Abuse Prevention.