Study: Underage Drinking Costs U.S. $62B

Published: July 10, 2006

WASHINGTON – A newly published study by the Pacific Institute of Research and Evaluation (PIRE) shows that underage drinking costs America nearly $62 billion a year.

At thousands of youth parties across the country, the overwhelmingly favored intoxicant will be alcohol. And yet, public attention remains focused on preventing youth drug use, not alcohol use.

According to a statement released by PIRE, more young people drink alcohol than use illegal drugs; in fact, alcohol kills 4 times more kids than all illegal drugs combined. However, federal funding for preventing drug use is about 25 times greater than spending on underage drinking prevention.

——Article Continues Below——

Get the latest industry news and research delivered directly to your inbox.

“The problems caused by underage drinking are a devastating tidal wave of alcohol harm,” said Ted Miller Ph.D., lead author of the cost study.

“Alcohol-related traffic crashes, violence, teen pregnancies, STDs, burns, drownings, alcohol poisoning, property damage and other risks take a human and economic toll that’s much greater than illegal drugs,” he said. “Yet we spend so much more on youth drug abuse.”

Each year, underage drinking leads to almost 3,200 deaths and 2.6 million other harmful events, from serious injury to high-risk sex among youth, according to the study published in the July edition of Journal of Studies on Alcohol.

When assigning dollar totals to alcohol-related problems among youth, violence and traffic crashes dominate the costs. The study estimates that youth traffic crashes attributable to alcohol cost $13.7 billion a year while violence costs $34.7 billion. Violence includes the 500,000 incidences of rapes and assaults each year related to underage drinking. Alcohol-related problems cost an average of $4,680 per underage drinker each year.

“Drinks in bars, drinks in cars, drinks stolen from Mom’s liquor cabinet: the average harm from a kid’s illegal drink is $3,” Miller said. “That’s far more than the 85 cent price tag those drinks carry. It dwarfs the 10 cents in taxes we collect or the 40 cents in profit the alcohol industry reaps.”

The study estimates that underage drinking generates $18 billion in sales of beer, wine and liquor for the alcohol industry each year. Sales of alcohol consumed by minors provide $2 billion in annual tax revenues. At least 16 percent of all alcohol sold – a conservative estimate, according to Miller – is consumed by underage drinkers.

“That is huge! The industry denies it market to kids, but the signs are everywhere,” he said. “Alcopops are not for the martini set.”

The lack of enforcement of legal drinking laws continues to contribute to the problem of underage drinking, he said. Minors obtain alcohol in three principal ways: through illegal purchases, at parties and from the family liquor cabinet or refrigerator. Research shows interventions can successfully reduce underage consumption, including regular police checks on sellers and servers of alcohol, improving age-checking technology, zero alcohol tolerance for drivers under 21, driving curfews, and “social host” policies that hold adults liable when minors drink at home parties.

General controls on alcohol also have shown effectiveness in reducing youth drinking, such as restricting the number and location of retail outlets, maintaining government retail monopolies on wine and spirit sales, and increasing alcoholic beverage taxes.

Underage drinking costs by state from this study are available at

Posted in: News

Tagged with:

Strategy & Planning Series
Strategy & Planning Series
Strategy & Planning Series
Strategy & Planning Series
Strategy & Planning Series