Tight labor market can lower standards

September 18, 2000
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Human resource professionals are calling this the tightest labor market in 40 years. According to the federal Department of Labor, the unemployment rate is about 4.4%. And while that is great for the economy and for personal incomes, employers are finding it harder to get the workers they need.

“The mad scramble we’re seeing for workers poses the very real threat of turning back the gains employers have made in the war against workplace drug abuse,” said Christine McGovern.

McGovern, widely regarded as an expert on drugs in the workplace, is workers’ compensation marketing manager of the Ohio Casualty Group, Hamilton, Ohio. She has helped more than 1,000 companies implement, improve, or monitor their drug-free workplace programs.

According to McGovern, in a tight labor market, companies are more likely to relax their standards when hiring people. “I’ve spoken to a lot of companies who have either ignored positive drug tests or scrapped post-job offer drug testing of applicants altogether,” she said.

“They say they simply can’t afford to lose anybody or turn anybody away. I tell them that they’re trading one problem for a much more serious one. After all, drug-abusing employees can kill a business.”

Statistics

Companies that employ part-time workers may be at particular risk.

According to the federal government’s Substance Abuse and Mental Health Services Administration (SAMHSA), 7.7% of part-time workers abused drugs in the past month, compared with 6.5% of full-time workers.

According to McGovern, companies depending on the unemployed or workforce-in-waiting to pick up the labor slack may be disappointed.

SAMHSA reports that 13.8% of the unemployed had used drugs in the past month.

A study by the University of Michigan in 1996 showed that 18% of college students had used some type of illegal drugs in the past 30 days. A survey designed by the Core Institute yielded similar results for the period 1995-96, finding that 18.6% of college students had smoked marijuana in the prior 30 days.

According to a 1998 University of Michigan study, 25.6% of high school seniors are already using drugs. The study shows that this rate almost doubled from the 14.4% of seniors who were using drugs in 1992.

“In the rush to find workers in this tight labor market, employers need to remember to protect themselves first,” McGovern said. She noted that workplace drug abuse costs companies in the U.S. more than $100 billion annually. “There’s a great deal of difference between a good employee and a warm body, and we see that every day in companies we insure across America.”

Tolerance

According to McGovern, companies in construction and the building trades have among the highest rates of employee drug usage compared to other employment sectors. It isn’t even uncommon for companies to accept a certain amount of substance abuse among employees and applicants.

“Some employers say, ‘As long as all they use is marijuana, we don’t care. It’s a pretty soft drug.’ They might even have used it in the past themselves. Other companies are afraid they wouldn’t have anyone to hire if they excluded marijuana users. They feel that at least they’re getting some output, some productivity, even though they might pay more in workers’ comp or health care costs.”

McGovern cited one insurance industry study that showed drug users are involved in three to four times more accidents and file five times more workers’ comp claims than non-users.

“I don’t know that I believe that it’s that high. But I have to believe that a forklift driver who uses drugs is more likely to have an accident than one who doesn’t use drugs,” she said. “We’ve had customers who have been able to reduce or deny claims because of the use of alcohol or drugs. Some states won’t let you reduce or deny claims.”

McGovern said some states are offering discounts on workers comp rates for employers that have drug-free workplace programs. Participants include Florida, Alabama, Georgia, Tennessee, South Carolina, and Ohio. Ohio Casualty Group offers credits in about 25 states. “That’s an incentive to business” she said.

For more information, contact Ohio Casualty Group at 888-788-4242; www.ocas.com (website).

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