“An extraordinary number of people are taking opioids in one form or another,” said Powell, during economic testimony before the House Financial Services Committee. “It weights on labor force participation, largely but not exclusively on younger males and younger women. It’s a national crisis really.”
“The humanitarian aspect is completely compelling. But the economic impact is also quite substantial,” Powell said.
The rate of labor force participation, which captures people working and those who want jobs, has steadily fallen since the Great Recession caused by the 2008 financial crisis, according to the U.S. Bureau of Labor Statistics, stagnating near 63% over the last 5 years.
Janet Yellen also addressed the opioid crisis impact on the economy during her time as Fed chair before Powell. In economic testimony before the Senate Banking Committee in 2017, Yellen said, in comments similar to Powell’s, that rampant opioid abuse in the U.S. is related to the decline in labor force participation among prime-age workers.
Health policy experts generally agree with Powell and Yellen about the magnitude of the opioid crisis and how it’s partly responsible for that decline in the labor participation rate.
More than 130 people in the U.S. die every day from opioid overdoses, with about 47,000 people dying in 2017, according to data from the U.S. Centers for Disease Control and Prevention. The proliferation of opioids is a major issue for U.S. lawmakers and the Trump administration, which have vowed to crack down on illicit use.
President Donald Trump on Wednesday morning addressed the epidemic during a speech from Washington, D.C.
“We’re aggressively confronting the opioid, fentanyl and drug addiction epidemic,” Trump said before signing his executive order to overhaul the nation’s kidney care market. “We’re making tremendous strides.”
Earlier this year, a former CEO of Rochester Drug Cooperative, one of the nation’s largest drug distributors, was indicted on what prosecutors say are the first criminal charges against an executive of a drug company to stem from the opioid epidemic. In addition, the federal government reached a $20 million settlement with the company over its alleged role in the crisis.
The federal charges came as OxyContin maker Purdue Pharma, who has been blamed for igniting the epidemic, faces some 1,600 lawsuits and possible bankruptcy. The Stamford, Connecticut-based company has been accused by nearly every U.S. state of downplaying how dangerously addictive its blockbuster pain killer is while exaggerating its benefits.