Employment Declines Among People with Disabilities: Population Movements, Isolated Experience, or Broad Policy Concern?

Abstract

We began by asking whether the decline in employment among those with disabilities was broad-based or narrowly focused, explained by population shifts or changes in behavior and/or opportunities among those with disabilities, or simply reflective of exogenous deteriorations in health, relatively immune from policy corrections. Our findings point strongly towards changes in behavior and/or opportunities as the key to understanding the recent decline. We show that employment declines were very broadbased across key population subgroups, that the largest contributions to the decline were among subgroups most connected to the labor market, and that shifts in population shares actually contributed positively, rather than negatively, to employment among those with disabilities during the 1990s. These findings tell us that there are no simple answers to the disturbing trend in employment. Instead the decline appears to owe to a complex combination of behavioral and policy changes that come together to dramatically alter the connection of people with disabilities to the labor market during the 1990s.

Keywords: Labor supply