Wage and Employment Growth in America’s Drug Epidemic: Is All Growth Created Equal?

The rise in drug overdose deaths in the United States since the turn of the millennium has been extraordinary. A popular narrative paints a picture whereby opioid overdoses among white, male, less-educated, rural workers have been caused by reduced economic opportunities borne by such people. In this article, we causally test the validity of this theory by using Bartik-type variables to explore the relationship between local economic conditions and county opioid overdose death rates. We add to the literature by exploring how both employment and wage growth in different types of industries are related to opioid overdose deaths for the population as a whole, as well as for rural (vs. urban), male (vs. female) and white (vs. black) populations. We find mixed evidence. Our results confirm that wage and employment growth in industries more likely to employ low-skill workers are important protective factors for rural, white males. However, we also find evidence that economic improvements in low-skill industries are just as important in protecting blacks and women against opioid overdoses, and for workers in metro counties. We also find evidence that employment growth in high-paying industries has led to increases in opioid overdoes rates.

Betz, M. and Jones, L.E. (2018). Wage and employment growth in America’s drug epidemic: Is all growth created equal? American Journal of Agricultural Economics, 100(1), 1357-1374.