At least two things about cigarettes are popularly understood: 1. They are extremely harmful to your health. 2. They are expensive. But “expensive” is a subjective term. What is the personal cost of smoking? And what is the more broad economic impact of the tobacco industry? While there is no simple answer to these questions, there is much to explore regarding the financial, medical, and environmental burden of commercial tobacco use.
Individual Cost, Communal Bill
The average cost for a pack of cigarettes in Michigan today is $8.27.1 To put that into perspective, the average Michigan smoker of median income would spend roughly 7% of their earnings on cigarettes.2 3 There are other direct and indirect costs of tobacco use. Smokers can pay as much as 50% higher on health insurance premiums4, and copays for medications and frequent office or hospital visits add up quickly. There is also opportunity cost, or the loss of potential gains from using funds for tobacco and tobacco related illness rather than investing into other aspects of life. One study estimated the total lifetime cost of smoking for an individual in Michigan was $2,193,645.5 Smoking, and the use of other tobacco products, is a heavy expense for the individual, but it also places a heavy financial burden on society.
Direct and Indirect Cost
The CDC reported that the U.S. spends $226.7 billion in one year on public and private health care costs related to tobacco use. Over half of this figure is tax funded. For perspective, that averages to each household paying $1,223 in taxes yearly just for tobacco related health care expenses. The CDC report states there is an additional $6.99 billion in health care costs related to secondhand smoke.6 Tobacco related illnesses also demand medical resources, and delays in care can increase the severity – and cost of treating – other patients.
Exploring the Environmental Cost
The treatment of tobacco related illness requires significant energy use and creates a massive amount of medical waste. This, along with the environmental damage related to production and consumption of tobacco products, contributes to a growing economic and existential problem. The White House recently released a report which claimed that by 2100 extreme weather events related to climate change could cost the country $2 trillion each year.7 It is difficult to estimate the economic impact of something as nebulous as the tobacco industry, which requires significant deforestation, water consumption, and carbon emissions to operate. One study found that the cost to simply address pollution caused by cigarette butts in the 30 largest U.S. cities was $264.5 million each year.8 Concern has been raised about even greater danger posed by electronic cigarette pollution.
Liability, Lies, Limits
The cost to address these problems must be borne by someone, and the tobacco industry is spending a fortune to deflect that responsibility onto the individual, with society ultimately left to pick up the bill. It’s a tough battle for anti-tobacco activists. In 2020, tobacco companies spent $28.2 million lobbying Congress alone.6 Accountability is a hard sell when tobacco companies are able to legally pay politicians, spend $23 million a day on marketing, and sponsor their own “research”. Perhaps, though, the fact that tobacco companies need to spend so much to survive is a positive sign. As our society continues to gain better understanding of personal wellbeing, the broad implications of public health, and the danger of climate change, the facts will be too loud to hush. The simple conclusion is that the true cost of tobacco will always be too much.
- This Smokefree.gov calculator shows how much money is saved over time after quitting cigarettes.
- ASH (Action on Smoke and Health) provides a wealth of information on the effects of the tobacco industry and what legal/policy measures can be taken to eventually end tobacco related deaths.
- Tobacco Free Funds provides information on funds that invest in tobacco manufacturers or entertainment agencies that promote tobacco use.
If you would like to learn more about tobacco reduction and cessation, please contact our team:
Melissa Small – Ypsilanti/Jackson Tobacco Treatment Specialist
Monica Allen – Detroit Tobacco Treatment Specialist
1: “Cigarette Prices by State 2022” World Population Review. Retrieved from: https://worldpopulationreview.com/state-rankings/cigarette-prices-by-state
2 & 3: Calculated using (average cost x average consumption) divided by median income.
2: “US Households Number of Cigarettes Smoked on an Average Day 2020” Statista. July 2021 Retrieved from: https://www.statista.com/statistics/275993/us-households-number-of-cigarettes-smoked-on-an-average-day/
3: “Median Individual Income in Michigan” Data Commons. Retrieved from:
4: “Marketplace Premiums Rise Faster For Tobacco Users Because Of Subsidy Design.” HealthAffairs. September 2020. Retrieved from: https://www.healthaffairs.org/doi/full/10.1377/hlthaff.2020.00015
5: “The Financial Cost of Smoking by State” WalletHub. January 2022. Retrieved from: https://wallethub.com/edu/the-financial-cost-of-smoking-by-state/9520
6: “The Toll of Tobacco in the United States” Tobacco Free Kids. November 2021. Retrieved from: https://www.tobaccofreekids.org/problem/toll-us
7: “The Future Cost of Climate Inaction 2 Trillion a Year Says the Government” NPR. May 2022. Retrieved from: https://www.npr.org/2022/04/07/1091258821/the-future-cost-of-climate-inaction-2-trillion-a-year-says-the-government
8: Schneider, J. E., Scheibling, C. M., Peterson, N. A., Granados, P. S., Fulton, L., & Novotny, T. E. (2020). “Online Simulation Model to Estimate the Total Costs of Tobacco Product Waste in Large U.S. Cities.” International journal of environmental research and public health, 17(13), 4705. https://doi.org/10.3390/ijerph17134705