Legalized Marijuana May Lead to Fewer Workers’ Compensation Cases Among Older Employees According to New Study by William Paterson University Professor Rahi Abouk

Rahi Abouk

As more states legalize recreational marijuana, a new study shows a resulting decline in the rate of workers’ compensation claims and benefit amounts among older employees, according to Rahi Abouk, health economics professor and director of the Cannabis Research Institute at William Paterson University, in recent study published in the National Bureau of Economic Research (NBER) with three other authors

The possible reason behind it? “Better pain management,” according to Abouk.

“We found that this population group substitutes cannabis for other pain medication treatments such as opioids, which improves their capacity to work, thereby making fewer mistakes and reducing injuries,” he says. When workers in pain have easier access to marijuana as a form of chronic pain management, the study shows that this may reduce their need for workers’ compensation and help them work longer.

The researchers focused on workers age 40 to 62 since they are more likely to experience health conditions for which marijuana may be a therapeutic substitute. Using data from 2010 to 2018, they studied several surveys of workers’ compensation claims, cannabis and pain medication drugs. Results show that propensity to file workers’ compensation claims and annual income from workers’ compensation decline by 20 percent after recreational marijuana is legalized.

The study also shows a decline in the non-fatal work injury rate and the incidence of work-limiting disabilities, and a corresponding reduction in the use of opioids following recreational marijuana law passage.

“This is important because it sheds light on how older adults in the U.S. are using recreational cannabis as a pain medication and how it affects the labor market outcome, such as workers’ compensation claims and the likelihood of having limited disabilities,” adds Abouk.

Abouk is the lead author of the working paper, “Does Marijuana Legalization Affect Work Capacity? Evidence from Workers’ Compensation Benefit,” along with Keshar M. Ghimire, University of Cincinnati - Blue Ash; Johanna Catherine Maclean of Temple University; and David Powell of the RAND Corporation.