No, High Workers Aren't What's Wrong with America's Economy

Bosses keep complaining that they can't find middle-class workers with clean urine—as if that's a real reason why inequality is so high in this country.
August 10, 2017, 7:50pm

America's most recent jobs report pegged unemployment at a 16-year low: just 4.3 percent. But while there have been recent signs of life for low-income workers, thanks in part to higher minimum wages in a number of cities and states, middle-class income isn't exactly taking off, and some decent-paying positions are going unfilled. Some employers and leaders of the business world, perhaps intent on skirting their own role in America's galloping inequality, seem to think drugs are a big reason why.


As the New York Times reported, in select rural corners of the country, employers are complaining that almost half of job applicants can't pass a drug test. The Federal Reserve's latest "Beige Book," an anecdotal report from its various district branches, cites similar complaints from businesses looking to hire. A Washington Post feature last weekend detailed one Wisconsin factory's decision to actually replace workers, some of whom couldn't pass drug tests, with robots.

The picture that emerges is of an America where corporations want to do right by the public, but simply can't find enough people who aren't stoned or about to shoot up to work for them.

Except there's a lot of evidence suggesting the business community has the causes of the labor shortage backward—or at least is missing the historical context here. The real problem is not some drug-related a-motivational syndrome, but decades of job loss wreaking havoc on communities, where what few jobs were available rarely paid off, and drug use skyrocketed. To blame the specter of drug addiction for shortages of labor is an odd response when persistent unemployment helped create this problem in the first place.

To take the preeminent drug problem of our time—opioids—as an example, according to one post-election study, the regions where the epidemic is most serious are often also the ones in which deindustrialization has wrought the most havoc. In these despairing environs, existing jobs often pay rock-bottom wages, and many workers with the means and skills to take higher-paid positions have taken off in search of education and opportunity elsewhere. It's not exactly surprising that businesses remaining in these extremely depressed areas would have difficulty hiring.

Check out our look at one person's struggle with the uniquely dangerous opioid fentanyl:

Katherine McLean, an assistant professor of sociology at Penn State University, has extensively studied McKeesport, a former steel mill town near Pittsburgh. Today, she said, the area is so bereft of opportunity that locals were excited about possible jobs when a strip club considered opening; another desirable source of growth was a potential new courthouse. "If you are able to get an education and come from a family with some resources, you leave," she told me, noting this pattern among her own relatives from the region.

In interviews with residents participating in addiction treatment, McLean asked why they thought overdose was so common in McKeesport. Nearly all talked about lack of decent jobs—not pharma company pushers or gangs bringing in drugs. "The one thing they describe as a good job opportunity in the area is dealing," she told me.


Although drug problems can obviously lead to unemployment, especially if they cause legal issues, decades of research suggests losing a job or not having one in the first place can also spur and worsen addiction. And high rates of addiction don't suddenly appear and create unemployment problems—instead, rising long-term unemployment tend to precede spikes in addiction, producing areas with the highest levels of "deaths of despair," via overdose, suicide and alcohol-related causes.

Take what happened to some of America's black communities in the 1980s. African Americans were among the first to suffer from rising youth unemployment as factory jobs disappeared in the second half of the 20th century; as de-industrialization progressed, both crack use and sales increased. Back then, the white middle class was healthier, and despite media fear-mongering, long-term crack addiction never really picked up steam in the suburbs.

These days, in high-wage areas of the country, if bosses are having a ton of trouble finding employees with drug-free urine, it's not showing up in testing data: A nationally representative sample of around 6.5 million pre-employment urine tests conducted by Quest Diagnostics, one of the premier lab-work companies in America, found that the failure rate was just 4.4 percent in 2016, the latest figure available.

The state with the highest proportion of positive drug tests for any reason (pre-employment, random, or post-accident) was Oregon, at 6 percent—which, as you will not be surprised to learn, was largely driven by positive marijuana tests. Also important: the state does not seem to be having a huge problem finding skilled workers. Oregon's unemployment rate was 3.7 last month, a few ticks below the current national rate of 4.3 percent. While those figures could be skewed by lower labor force participation—people giving up on the job hunt—if drugs were preventing hiring in a big way, a rate this low should never have been attainable.


"Clearly there are some difference in positivity rates, but still not approaching 50 percent in the data we're looking at," Barry Sample, senior director of science and technology for Quest, told me in an interview. Testing for opioids in urine is complicated, and Quest does not aggregate these drugs into a single category. But to take one example, the highest rate of positive tests in any region of America observed for codeine or morphine was 2.4 percent; the highest rate of positives for a metabolite that indicated heroin use was 0.6 percent.

Since these tests do not include fentanyl and its derivatives, some people who use opioids are clearly being missed. But that's true whether you are an employer complaining of nearly 50 percent fail rates or Quest, which has been conducting research on levels of positive drug tests among millions of workers annually since 1988.

Alan Krueger, who chaired President Obama's Council of Economic Advisors from 2011-13 and is now a professor of economics at Princeton, published a widely covered study last year finding 29 percent of working-age men currently out of the labor force took prescription pain medication daily. A full third, he found, had a disability.

The study described a silent surge in the number of nonworking men—those who are neither employed nor looking—to around 11 percent of those between 25 and 54. Krueger's told the Times that one factor here may include addiction—and that up to 10 percent of workers with low-paying jobs are being held back by drug use. But his study did not distinguish between people taking opioids for chronic pain and those who are addicted—and since the professor has a forthcoming paper on the issue coming out this fall, he was reluctant to wade into the drug issue too deeply.


Krueger did tell me, however, that wages are a big part of this story—one that paints a picture of a relatively hollow job market so far in the Trump era. "I think that employers have grown too accustomed to an environment where they didn't have to raise wages to recruit talented workers in the US," he said. "This is changing with the unemployment rate below 5 percent. But many employers have not changed their mindset."

Another issue that employers have to consider is weed—and whether testing for it really makes sense for most jobs. Seven states and the District of Columbia have legalized recreational use of the drug, and 29 tolerate medical use. Meanwhile, a positive urine test for pot doesn't prove impairment because metabolites can stay in the body for a full month.

With studies showing that legal-pot states tend to have lower rates of opioid addiction and overdose, picking on workers who prefer a drug less harmful than either opioids or alcohol may not be such a great idea. In fact, there's only weak evidence that testing for drugs other than alcohol improves safety at all in the workplace; other developed countries test less frequently.

That's probably because drug tests measure levels of drugs in the body—not impairment, which varies with factors like fatigue, stress, illness, and tolerance. Driving after up staying up for 24 hours, for example, may be just as risky as driving when legally drunk.

Some jobs obviously require sobriety or something close to it, especially those centering on the use of dangerous machinery. But a harsh regime of drug-tests appears to be depriving otherwise decent candidates of jobs more than it is preventing dangerously impaired people from harming the public.

It's America's fondness for drug-screening that needs to be called out—not actual drug use—for holding back the economy. "It seems like drug testing should be framed as a barrier to employment, instead of as this absolutely necessary and justified requirement for many of these industries," McLean, the sociologist, told me. Since employment is one of the most important factors in sustaining recovery from addiction, automatically rejecting workers due to positive tests can backfire for society in the long run.

Regardless of your view on the merits of drug testing, it's clearly wrong to suggest rampant drug use is holding back the growth of the middle class. A better bet is greedy bosses, and a political class that hasn't responded to workers' needs.

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