New Study Reveals Economic Benefits of Reducing Teens’ Psychological Stress

A new study reveals that enhancing adolescent mental health can yield billions in economic savings for the U.S. by improving labor force participation and reducing public assistance costs. Researchers suggest these findings should inform federal policy decisions.

In a new study published in PLOS Medicine, researchers led by The Kennedy Forum, a mental health nonprofit in the United States, reveal a compelling link between adolescent mental health and substantial economic benefits. This novel research could redefine federal budgeting for mental health policies, emphasizing the long-term financial gains of prioritizing youth mental well-being.

Led by Nathaniel Counts, chief policy officer at The Kennedy Form, the team analyzed data from 3,343 participants in the National Longitudinal Study of Youth 1997. This comprehensive study captures information through regular interviews.

By exploring data from the year 2000, when the participants were aged 15 to 17, and again in 2010, the researchers were able to pinpoint significant correlations between teen mental health and economic outcomes in adulthood.

Their findings are eye-opening: adolescents suffering from clinically significant psychological distress are less likely to participate in the labor force a decade later and earn, on average, $5,658 less annually.

These metrics provide a tangible way for government budget analysts to estimate the economic benefits of policies aimed at improving adolescent mental health.

To illustrate, the research team modeled a hypothetical policy that expands access to preventive mental health care, targeting just 10% of adolescents who might otherwise experience psychological distress.

The result? A projected U.S. budget saving of $52 billion over 10 years, stemming solely from increased labor participation.

“As the U.S. faces a crisis in adolescent mental health, the need for greater investment has never been more urgent. Previous studies found that investing in mental health early could save money down the line. Our new research finds that, at the scale of the United States economy, improvements in adolescent mental health may bring many billions of dollars of federal budget benefits over 10 years, potentially offsetting the costs of policy change that could cover critical services for young people, such as integrated care,” Counts said in a news release.

This study stands out because, unlike prior research, it presents its findings in a format directly applicable to standard economic models used in policy assessments. This could pave the way for these critical considerations to be included in federal decision-making processes.

The researchers also highlight the need for future studies to further refine these parameters, making the case for more robust investment in adolescent mental health services.

By integrating the economic benefits of mental health policies into federal budgeting, policymakers could not only improve the lives of young people but also realize significant financial savings for the country. The implications of this study strongly support the case for increased mental health funding and policy reform to support the next generation.