National Drug Strategy
National Drug Strategy

The costs of tobacco, alcohol and illicit drug abuse to Australian Society in 2004/05 - Summary Report

4. Productivity

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Drug abuse causes a loss of national productive capacity in the paid workforce as a result of drug-attributable death and sickness. Losses are also experienced in the unpaid workforce (the household sector) from the same causes. Against these losses are the savings in national resources that would have been consumed if the drug-attributable deaths had not occurred. Net production losses represent the gross reduction in productive capacity less these consumption savings. Table 8 presents estimates of the reductions in productive capacity that resulted from drug abuse in 2004/05.

Table 8, Paid and unpaid production costs of drug abuse, 2004/05

Alcohol Tobacco Illicit Total Proportion
drugs of gross
costs
($m) ($m) ($m) ($m) (%)
Labour in the workforce
Reduction in workforce
Male 2,741.4 4,030.1 762.3
Female 469.3 939.3 127.1
Total reduction in workforce 3,210.7 4,969.5 889.4 9,069.5 39.7
Absenteeism
Male 228.5 646.9 698.9
Female 139.4 132.7 34.6
Total absenteeism 367.9 779.6 733.5 1,880.9 8.2
Total paid production costs 3,578.6 5,749.1 1,622.9 10,950.5 47.9
Labour in the household
Premature death
Male 1,294.4 5,806.9 314.6
Female 129.5 3,349.5 143.9
Total premature death 1,423.9 9,156.4 458.5 11,038.8 48.3
Sickness
Male 60.7 452.8 30.1
Female 86.3 233.9 6.9
Total sickness 146.9 686.7 37.0 870.6 3.8
Total unpaid production costs 1,570.8 9,843.1 495.5 11,909.4 52.1
Total paid and unpaid production costs 5,149.4 15,592.2 2,118.3 22,859.9 100.0
Consumption resources saved
Male 1,464.1 5,534.8 367.8
Female 147.2 2,048.3 101.6
Total consumption resources saved 1,611.3 7,583.1 469.5 9,663.9
Total net production costs 3,538.0 8,009.1 1,648.9 13,196.0
Percentage of total net production costs 26.8% 60.7% 12.5% 100.0%


Of the total net production costs of $13.2 billion, tobacco accounted for by far the largest share (60.7 per cent or $8.0 billion). Alcohol represented 26.8 per cent ($3.5 billion) and illicit drugs 12.5 per cent ($1.6 billion). Of the gross production costs of $22.9 billion, workforce losses represented 47.9 per cent ($11.0 billion) and household losses 52.1 per cent ($11.9 billion).

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