NCPA - National Center for Policy Analysis

Surprising Drop In Workplace Injuries

September 14, 2000

The workplace became much safer during the 1990s, and experts are trying to figure out why. They have more or less ruled out any impact from Occupational Safety and Health Administration policies. But they do agree that the drop in lost workdays has had the effect of expanding the pool of available labor, as well as allowing employers to save on workers' compensation costs.

  • Since 1992, the number of work-related injuries and illnesses has fallen 15 percent -- to 6.7 per 100 full-time workers, from 8.9.
  • This unexpected improvement translates to at least a $125 billion annual lift for the economy.
  • In 1998, there were 5.9 million cases of work-related injuries and illnesses -- mostly injuries -- in the private sector.
  • If the pre-1992 cyclical pattern had held, there should have been 3 million more.

The decline in injuries is remarkable because it reverses a historical pattern discovered by Robert S. Smith of Cornell in 1972. He found that injuries usually rise when unemployment falls because work intensity increases and many inexperienced workers are hired. Yet the tightest labor market in a generation has coincided with the lowest work-related injury and illness rate since the Bureau of Labor Statistics started tracking it.

The rate of fatal occupational injuries has dropped 13 percent since 1992. And the cost to employers for workers' compensation fell by one-third from 1992 to 1998 -- for an aggregate savings of $25 billion in 1998, adjusted for inflation.

A number of analysts credit business owners with the improvement, It was they, after all, who invested in newer and safer plants and equipment during the 1990s boom years.

Source: Alan B. Krueger (Princeton University), "Economic Scene: Fewer Workplace Injuries and Illnesses Are Adding to Economic Strength," New York Times, September 14, 2000.


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