How Working age People with Disabilities Fared over the 1990s Business Cycle

Using data from the March Current Population Survey (CPS) we show that while the longest peacetime economic expansion in United States history has increased the economic well-being of most Americans, the majority of working age men and women with disabilities have been left behind. Robust economic growth since the recession of the early 1990s has lifted nearly all percentiles of the income distribution of working age men and men without disabilities beyond their previous business cycle peak levels of 1989. In contrast, the majority of working age men and women with disabilities did not share in economic growth over this period. Not only did their employment and labor earnings fall during the recession of the early 1990s but their employment and earnings continued to fall during the economic expansion that followed

Economics of Disability Research Report #5: Economic Outcomes of Working-Age People with Disabilities over the Business Cycle – an Examination of the 1980s and 1990s

We examine the rate of employment and the household income of the working-age population (aged 25-61) with and without disabilities over the business cycles of the 1980s and 1990s using data from the March Current Population Survey and the National Health Interview Survey. In general, we find that while the employment of working-age men and women with and without disabilities exhibited a procyclical trend during the 1980s business cycle, this was not the case during the 1990s expansion. During the 1990s, the employment of working-age men and women without disabilities continued to be procyclical, but the employment rates of their counterparts with disabilities declined over the entire 1990s business cycle. Although increases in disability transfer income replaced a significant fraction of their lost earnings, the household income of men and women with disabilities fell relative to the rest of the population over the decade

Children in Poverty: Trends, Consequences, and Policy Options

Outlines trends and factors in the U.S. child poverty rate and reviews research linking poverty and lower levels of child well-being, including educational and cognitive, social and emotional, economic, and health outcomes. Makes policy recommendations

Curing the Dutch Disease: Lessons for United States Disability Policy

In the 1990s, the United States reformed welfare programs targeted on single mothers and dramatically reduced their benefit receipt while increasing their employment and economic wellbeing. Despite increasing calls to do the same for working age people with disabilities in the U.S., disability cash transfer program rolls continue to grow as their employment rates fall and their economic well-being stagnates. In contrast to the failure to reform United States disability policy, the Netherlands, once considered to have the most out of control disability program among OECD nations, initiated reforms in 2002 that have dramatically reduced their disability cash transfer rolls, while maintaining a strong but less generous social minimum safety net for all those who do not work. Here we review disability program growth in the United States and the Netherlands, link it to changes in their disability policies and show that while difficult to achieve, fundamental disability reform is possible. We argue that shifts in SSI policies that focus on better integrating working age men and women with disabilities into the work force along the lines of those implemented for single mothers in the 1990s, together with SSDI program changes that better integrate private and public disability insurance programs along the lines of the reforms in the Netherlands, offer the best hope of improving their employment rates and economic well-being as well as reducing SSDI/SSI program growth.

Self-Reported Work Limitation Data: What They Can and Cannot Tell Us

Data constraints make the long-term monitoring of the working-age population with disabilities a difficult task. Indeed, the Current Population Survey (CPS) is the only national data source that offers detailed work and income questions and consistently asked measures of disability over a 20-year period. Despite its widespread use in the literature, the CPS and surveys like it have come under attack of late, with critics discounting the results of any research obtained from such data. We put these criticisms in perspective by systematically examining what the CPS data can and cannot be used for in disability research. Based on comparisons with the National Health Interview Survey (NHIS), a data set with much more information on health than the CPS, we find that the work limitation-based definition of disability available in the CPS underestimates the size of the broader population with health impairments in the NHIS, but that the employment trends in these two populations in the NHIS are not significantly different from one another. We then show that the trends in employment observed for the NHIS population defined by self-reported work limitation are not statistically different from those found in the CPS. Based on these findings, we argue (1) that the CPS and other nationally representative employment-based data sets can be used to monitor trends in outcomes of those with disabilities and, (2) that the dramatic decline in the employment of people with disabilities we describe in the CPS during the 1990s is not an artifact of the data

The Transformation in Who is Expected to Work in the United States and How it Changed the Lives of Single Mothers and People with Disabilities

In the 1990s, social expectations of single mothers shifted towards the notion that most should, could, and would work, if given the proper incentives. This shift in expectations culminated in the passage of the Personal Responsibility and Work Opportunity Reconciliation Act in 1996, commonly known as welfare reform. As a result, ADFC/TANF caseloads fell along with cash transfers to single mothers who did not work. A decade later the earnings and household income of single mothers are significantly higher and moving more in synch with the U.S. economy. In stark contrast and despite espoused goals to the contrary, public policies toward working age men and women with disabilities have remained imbued with the notion that most cannot and thus, would not work, no matter what incentives they faced. As a result, SSDI/SSI expenditures and caseloads have increased and the earnings and household income of working age men and women with disabilities have fallen, leaving them even further behind the average working age American than they were a decade ago. Using data from the Current Population Survey we follow the economic well-being and employment of single mothers and working age men and women with disabilities over the past two major United States business cycles (1982-1993 and 1993-2004) and show that despite the dramatic decline in AFDC/TANF funding, single mothers’ economic well-being, labor earnings and employment all have risen substantially. In contrast, despite the dramatic increase in SSDI/SSI funding, the economic wellbeing of working age men and women with disabilities remained stagnant, as their labor earnings and employment plummeted.

Disability benefit growth and disability reform in the US: lessons from other OECD nations

Abstract Unsustainable growth in program costs and beneficiaries, together with a growing recognition that even people with severe impairments can work, led to fundamental disability policy reforms in the Netherlands, Sweden, and Great Britain. In Australia, rapid growth in disability recipiency led to more modest reforms. Here we describe the factors driving unsustainable DI program growth in the U.S., show their similarity to the factors that led to unsustainable growth in these other four OECD countries, and discuss the reforms each country implemented to regain control over their cash transfer disability program. Although each country took a unique path to making and implementing fundamental reforms, shared lessons emerge from their experiences. JEL codes J14, J18</jats:p

Recounting Winners and Losers in the 1980s: A Critique of Income Distribution Measurement Methodology

The 1980s have been characterized as a time when the “rich got richer and the poor got poorer.” Using a cross-over point methodology used in several recent studies, we show how sensitive the measurement of winners and losers can be to seemingly small differences in methodological practice. Specifically, we show sensitivity to the years compared, the income sharing unit chosen, and the inflation index used. Our results show that these and other studies of economic well-being exaggerate losses by mixing cyclical with cross-cycle effect