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Employment of the Disabled, Work Changes Due to COVID, and Disability Policy

By Mark J. Warshawsky

December 30, 2022

The Occupational Requirements Survey (ORS), conducted by the Bureau of Labor Statistics (BLS), gathers information from employers on the physical, educational and cognitive requirements of jobs throughout the US economy. This data is available to the Social Security Administration (SSA) to determine eligibility for disability benefits; however, it has been four years since the first complete ORS data set was published and the SSA still does not use it. The recent rise in telework, among other factors, has further joined the labor market of the disabled to that of the overall population, giving the SSA even more reason to incorporate the gathering ORS data in their eligibility decisions.

According to the BLS, the labor force participation rate (LFPR) of the disabled is at an all-time high and the unemployment rate (UER) of the disabled is at an all-time low. Although the UER of the overall population is now also low, the LFPR of the overall population has not yet recovered from the lows of the 2020 recession. Indeed, by reasonable comparisons across various metrics and time periods, the employment of the disabled has increased much more than that of the overall population, particularly recently.

From December 2011, towards the beginning of the recovery from the Great Recession, to December 2019, just before the deep but short COVID recession, the LFPR of the overall population declined modestly from 63.8 to 63 percent, perhaps reflecting the beginning of the retirement of the baby boom generation. The LFPR of the disabled over that period, however, was essentially flat, moving from 20.7 to 20.5 percent. The contrast of the UER is even stronger—for the overall population, it moved from 8.3 to 3.4 percent, a decline of 4.9 percentage points, while for the disabled, the UER moved from 13.5 to 7 percent, a decline of 6.5 percentage points.

The more recent experience shows an even larger contrast between the overall population and the disabled, in favor of the disabled. From May 2020, the beginning of the recovery from the COVID recession, to November 2022, the month with the most recent data, the LFPR for the overall population changed from 60.7 to 62.1 percent, only a 1.4 percentage point increase, while the LFPR for the disabled moved from 20.4 percent, essentially unchanged from before the recession, to 23.7 percent, a 3.3 percentage point increase. Looking at the UER, the contrast is there as well—for the overall population, the decline over the recent period was from 13 to 3.4 percent, a move down of 9.6 percentage points, whereas for the disabled, the decline in the UER was from 17.9 to 5.8 percent, a decrease of 12.1 percentage points.

It’s also worth noting consistent trends in Social Security Disability Insurance—the incidence rate of new benefit awards has been surprisingly low recently (although there are also administrative problems at the SSA that may be a recent factor) and the recovery rate for existing beneficiaries is elevated.

What could account for the superior employment performance of the disabled, especially recently? A recent NBER working paper by Harvard Professors Ne’eman and Maestas notes that the relative positive employment growth recently experienced by the disabled is heavily concentrated in teleworkable, essential, and non-frontline occupations. They state that the particularly strong employment growth in teleworkable occupations suggests that the expansion in telework may have had a positive impact on disability employment. In particular, in regression analysis, Ne’eman and Maestas find from Q2 2021 through Q2 2022, disabled employment in teleworkable occupations had outpaced non-disabled employment there by 18.6 percent, largely driven by the increase in the LFPR. This is logical because for many people with certain types of mental and physical disabilities the avoidance of a long commute, a quiet and controlled home workplace, and other telework accommodations may allow for more continuous and productive work.

There is some evidence that these more favorable work conditions may last past the COVID epidemic. According to a survey by the Kessler Foundation of supervisors from US employers in spring 2022 compared to a similar survey done in 2017, more supervisors said that their organizations had a process to provide requested accommodations to employees with disabilities, a centralized accommodation fund, flexible working arrangements like job sharing, and, in particular, there is much more use of a flexible work schedule and the option to work from home some or most of the time.

The best way to officially confirm, quantify, and describe in detail this apparent change in work conditions and to incorporate it in decisions by the SSA on eligibility for disability benefits is to continue the annual fielding of the ORS of employers for the SSA and to use the ORS data in the SSA adjudication process.

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