Are Alcoholics in Bad Jobs?

47 Pages Posted: 13 Jul 2000 Last revised: 1 Jul 2010

See all articles by Donald Kenkel

Donald Kenkel

Cornell University - Department of Policy Analysis & Management (PAM); National Bureau of Economic Research (NBER)

Ping Wang

Washington University in St. Louis - Department of Economics; National Bureau of Economic Research (NBER)

Date Written: February 1998

Abstract

Alcohol abuse has important implications for the productivity of the US workforce. The lost earnings of workers suffering from alcohol problems have been estimated at $36.6 billion in 1990. After completing schooling, young workers face critical labor market choices with long-ranging consequences for future jobs and lifetime earnings, while many of them also drink alcohol to excess. In this paper, we provide evidence on whether the drinking choices of young adults also have long-ranging consequences for future jobs and lifetime earnings. In doing so we extend previous research on the productivity effects of alcohol to include non-wage job attributes as part of total employee compensation. The goal of this research is to establish benchmark empirical patterns describing relationships between alcoholism and job choice. Our empirical results based on the National Longitudinal Survey of Youth (NLSY) data show that male alcoholics are less likely to receive a variety of fringe benefits, are more likely to be injured on the job, and work for smaller firms. When the conventional methodology is extended to include non-wage job attributes, of an estimated total loss of $2,380 per alcoholic, about $450, or almost 20% or the total, is the value of the lost fringe benefits. The data also show that male alcoholics are less likely to be in a white collar occupation but conditional upon being in a white collar occupation their earnings are similar to their non-alcoholic peers. While alcoholics are more likely to be in a blue collar occupation, conditional upon being in such an occupation they are estimated to earn 15% less than their non-alcoholic peers. These findings help evaluate the potential effects of alcohol, education and income policies and health policy.

Suggested Citation

Kenkel, Donald and Wang, Ping, Are Alcoholics in Bad Jobs? (February 1998). NBER Working Paper No. w6401. Available at SSRN: https://ssrn.com/abstract=226149

Donald Kenkel

Cornell University - Department of Policy Analysis & Management (PAM) ( email )

120 Martha Van Rensselaer Hall
Ithaca, NY 14853
United States
607-255-2594 (Phone)
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National Bureau of Economic Research (NBER)

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Ping Wang (Contact Author)

Washington University in St. Louis - Department of Economics ( email )

One Brookings Drive
St. Louis, MO 63130
United States

National Bureau of Economic Research (NBER) ( email )

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

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