This Product Sets The Economy Back By Billions Every Year

(Photo by Spencer Platt/Getty Images)

(Photo by Spencer Platt/Getty Images)

Most people grow up well-aware that smoking — or tobacco use of any kind, really — is incredibly harmful and dangerous to our health. While it’s largely a matter of personal choice whether or not someone decides to pick up the habit, the costs to the economy at large can be much more monstrous than anyone really realizes.

Now, we can put a dollar figure on it.

Last year, Gallup released the results of a study they put together that found smoking is the direct cause of $278 billion in lost productivity and excess medical costs. They arrived at that figure by analyzing the cost of missed workdays due to poor health, tallying up smoking breaks and associated health costs that were not incurred by employees who do not smoke. Gallup‘s figures indicate that just over 19% of the U.S. workforce can be identified as smokers, which accounts for up to nearly 29 million people.

Source: Gallup

Source: Gallup

For the study, 67,000 people were interviewed, which included questions like: “During the past 30 days, for about how many days did poor health keep you from doing your usual activities?” and “How many actual workdays in the last month did you not work due to poor health?”

The results, seen above, may only be the tip of the proverbial iceberg, however.

The $278 billion figure is rather staggering all on its own, and it’s not too much of a stretch to think that those who need to absorb or incur those costs — namely businesses or taxpayers, for the most part — are not happy about it. For perspective, each missed workday can cost an employer up to $341 per day, and smoke breaks alone, calculated as partial absenteeism, can end up costing more than $3,000 per year.

For those who do actually end up taking the hit in terms of dollars and cents, is there anything that can actually be done about it? This is undoubtedly a question that many employers have asked over the years, and it doesn’t appear that an answer has materialized as of yet. Federal law doesn’t dictate that smokers have a legal entitlement to smoke breaks, although there are laws that say employees need to have a break every so often. Of course, employees could always just leave their work stations to step outside for a cigarette, which amounts to partial absenteeism expenses.

Another thing that might drive employers up the wall? People who are not even smokers are not immune to the negative health repercussions that tobacco use presents. In 2006, the Centers for Disease Control and Prevention estimate that $5.6 billion in lost productivity was attributed to exposure to second-hand smoke. These are employees who do not even use tobacco, yet are experiencing negative health effects and tallying up costs — both in terms of their health and monetarily.

So what options do employers, whether they be private or otherwise, have in trying to wrangle in the extra costs associated with employees who smoke? Is it ethical to discriminate against applicants or current employees based on a habit? Hell, is it even legal?

Well, it depends. Many states have laws that protect smokers from being discriminated against, but it’s not hard to imagine that those laws will eventually be overturned or shot down as the overall number of smokers declines, and the incredible costs become more apparent. Of course, that does bring up all sorts of issues revolving around privacy and personal choice, but it is likely something that will be addressed in the future. After all, $278 billion in expenses is nothing to ignore.


Source: CDC

The good news is that smoking rates have been declining for many years now. As the leading cause of preventable death and disease in America, health professionals have done their best to educate the public about the hazards of tobacco use for decades now. Obviously, many people have listened as smoking rates have dropped, but roughly one out of every five Americans still uses tobacco.

Again, that’s a matter of personal choice, but the costs are not simply being shouldered by those who choose to smoke. The cost is being shoved onto everyone else, both employers and onto the health care system at large. Perhaps that will spur on even more change, now that dollar figures in the hundreds of billions are being attached to smoking, that will only add to the stigma?

The CDC says that there are market-based approaches to lowering smoking rates as well. They say that the single most effective way to lower smoking rates is to increase the price of cigarettes. By their calculations, a 10% increase in cigarette prices correlates to overall consumption dropping by 3%-5%. If consumers can feel the pinch on a micro-transaction level, at what point will that translate to calls from big business to tackle the issue head-on as well?

Epidemiologist Brian King of the CDC’s Office on Smoking and Health has further commented on how pricing can influence smoker’s behavior, telling HealthDay News that, “In 2009, the Family Smoking Prevention and Tobacco Control Act was implemented, which gave the FDA the authority to regulate tobacco.”

“Also, in 2009, the federal tax rate for cigarettes increased from 39 cents a pack to $1.01 a pack. We know that increasing tobacco prices is the single most effective way to reduce smoking,” he added.

Again, most people are well-aware of the implications that smoking has on one’s personal health. But where is the line drawn when the costs are being transferred to employers and taxpayers? With a price tag of $278 billion, how long before some serious action is taken to curb smoking’s effects? If rates keep dropping, perhaps no action will be taken. But if there’s one thing we’ve learned over the past several years about American businesses, it’s that if there is a way to cut costs and strengthen the bottom line, it’ll likely find a way to make it happen.

Follow Sam on Twitter @Sliceofginger

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