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Drug and Alcohol Abuse Slowing Labor Force Recovery, Fed Finds

April 14, 2022, 5:16 PM

Federal Reserve policy makers and researchers who have been puzzled by the slow return of U.S. workers to the labor force during the Covid-19 pandemic may have found a new explanation: alcohol and drug abuse.

Increased substance abuse accounts for between 9% and 26% of the decline in prime-age labor-force participation between February 2020 and June 2021, according to a new study by Federal Reserve Bank of Atlanta researcher Karen Kopecky, Jeremy Greenwood of the University of Pennsylvania and Nezih Guner of the Universitat Autonoma de Barcelona.

Labor force participation of workers ages 25 to 54 hasn’t fully recovered after ...