TreasureX Researchnber.wpOSHA Inspections Cut Injuries at Nearby Workplaces Too, Study Finds
Matthew S. Johnson, David Levine, Michael W. Toffel · September 14, 2026
A new NBER working paper by Matthew S. Johnson, David Levine, and Michael W. Toffel looks at whether workplace safety inspections do more than fix the site being inspected. The challenge is that regulators tend to target problem workplaces, and nearby sites often share the same local conditions, making it hard to separate cause from correlation.
The authors get around this using OSHA's Site-Specific Targeting program, which picks workplaces for inspection based on injury rates near a sharp cutoff. That setup creates something close to random variation in who gets inspected. Comparing workplaces just above and below the line, they find that an inspection reduced injuries at uninspected establishments in the same ZIP code by about 11 percent — roughly the same size as the direct effect on the inspected site.
Why it matters: because one inspection appears to change behavior at several nearby workplaces, the total injuries avoided is several times larger than the direct effect alone. For investors, this suggests workplace-safety regulation may deliver bigger returns than standard cost-benefit analyses assume, and that compliance risk can spread across a local labor market rather than staying inside one facility. Sectors with heavy physical operations — construction, manufacturing, logistics, and parts of energy and consumer cyclical — are most exposed.
Source: National Bureau of Economic Research — https://www.nber.org/papers/w35646#fromrss
Educational content only, generated with AI assistance from public research abstracts. Not investment advice.