Goldman Sachs strategists have made an intriguing prediction: A surge in the use of weight-loss drugs like Ozempic could potentially supercharge the U.S. economy in the coming years. According to their estimations, the widespread adoption of these drugs could result in a significant boost to the nation’s gross domestic product (GDP).

“If GLP-1 usage ultimately increases by this amount and results in lower obesity rates, we see scope for significant spillovers to the broader economy,” the analyst note said, Fox Business reported. “Academic studies find that obese individuals are both less likely to work and less productive when they do.”

The forecast hinges on the premise that poor health poses a substantial burden on economic growth, primarily by limiting the workforce due to increased absenteeism and reduced productivity stemming from health-related issues. Goldman Sachs believes that addressing these health concerns, particularly obesity-related issues, could lead to a substantial uptick in economic output.

Specifically, the bank predicts that the increased use of weight-loss drugs known as GLP-1 agonists could potentially add an extra 1 percent to the nation’s GDP over the next decade. This translates to approximately $360 billion per year.

The rationale behind Goldman’s forecast is rooted in the detrimental impact of poor health on workforce participation and productivity. Obesity, in particular, is highlighted as a significant contributor to various health problems, including heart disease, strokes, and diabetes, which in turn hinder economic growth by limiting labor supply and productivity.

With the obesity rate in the U.S. hovering around 40 percent, the potential market for GLP-1 drugs is substantial. These drugs, which include Ozempic and Wegovy, have garnered attention for their ability to facilitate weight loss, with some users experiencing dramatic results. Studies have also suggested that these drugs may reduce the risk of cardiovascular events, further underscoring their potential health benefits.

“Combining current losses in hours worked and labor force participation from sickness and disability, early deaths, and informal caregiving, we estimate that GDP would potentially be over 10% higher if poor health outcomes did not limit labor supply in the U.S.,” Jan Hatzius, the chief economist at Goldman Sachs, wrote.

“The main reason we see meaningful upside from healthcare innovation is that poor health imposes significant economic costs. There are several channels through which poor health weighs on economic activity that could diminish if health outcomes improve,” Hatzius said, Business Insider reported.

Goldman Sachs’ projections are based on the assumption that between 10 million to 70 million Americans could be taking weight-loss drugs by 2028, depending on various factors such as clinical trial outcomes and insurance coverage. The bank envisions a scenario where increased usage of these drugs leads to lower obesity rates, resulting in significant economic spillovers.

Photo by Karolina Grabowska: https://www.pexels.com/photo/woman-measuring-waistline-with-a-pink-tape-measure-5714347/