One Size Does Not Fit All: A New Look at the Labor Force Participation of People with Disabilities

Michelle Yin and Dahlia Shaewitz

Although overall U.S. unemployment rates are nearly back to normal after the Great Recession that began in 2007, millions of working-age adults with disabilities are willing to work but do not have jobs and do not count as unemployed. Disability remains a primary reason Americans are not in the workforce—32% of people not looking for a job reported that they are disabled; this figure continues to rise. This paper examines labor market outcomes for this population by disability type at both the national and state levels.

Since at least the mid-1970s, policymakers have shifted their attention from income support for people with disabilities to policies designed to promote labor participation and employment. Despite the array of federal policies, executive orders, and incentive programs intended to increase employment and employability of people with disabilities, labor market outcomes have not improved for this population in more than 40 years. Current policy typically addresses people with disabilities as one homogeneous group. However, people with disabilities require different types and levels of accommodations and the cost of providing vocational rehabilitation and employment-specific services varies by disability type as well.

The researchers' analysis reveals that the labor participation choices and employment experiences of people with disabilities vary substantially by disability type. These patterns remain similar even after controlling for individual characteristics, suggesting a need to account for this diversity if policymakers aim to improve the labor market outcomes for this population.