The available data indicate that less than a third of disabled working-age adults are employed, and, when they are, they are paid lower wages. Their incomes are low even after including transfer payments. The problem of identifying a disabled person and the nature of the labor market are reviewed in this article. It is argued that in addition to imposing functional limitations, disability steals time and shortens life expectancy. The Americans with Disabilities Act is intended to improve the plight of the disabled by mandating equal employment rights, a rights approach that worked well for race and gender but will not do for the task at hand. People with disabilities do not constitute an identifiable minority. They move into and out of a state of being disabled and exhibit different degrees of limitation and different life expectancies. The aim of eliminating labor market discrimination is important, but equal access to jobs and public places will not significantly improve the well-being of disabled persons unless it is integrated into a larger disability policy program including rehabilitation, medical care, and income transfers.
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References
1.
1. Bureau of National Affairs, 18 July 1990.
2.
2. Ibid.
3.
3. In the annual March Supplement to the Current Population Survey, the basic house-hold survey, an individual is classified as having a work limitation if one or more of the following conditions are met: the person (1) has a condition that prevents him from working or limits the kind or amount of work he can do, (2) ever retired or left a job for health reasons, (3) did not work in the survey week because of a long-term illness or disability that prevents the performance of any kind of work, (4) did not work in the previous year because he was ill or disabled, (5) is under 65 years of age and covered by Medicare, (6) is under 65 and a recipient of Supplemental Security Income. If one or more of the last four conditions is met, the individual is counted as having a severe work limitation. The survey is administered only to working-age adults, 16 to 64 years of age. See Robert L. Benefield and John M. McNeil, Labor Force Status and Other Characteristics of Persons with a Work Disability: 1981 to 1988, Current Population Reports, series P-23, no. 160 (Washington, DC: Government Printing Office, 1989).
4.
4. See Lawrence D. Haber, “Operating Definitions of Disability: Survey and Administrative Measures,” in Disability in the United States, ed. S. Thompson-Hollman and I. F. Storck (New York: Springer, 1991), pp. 228-41. Haber reports the low estimate—8.5 percent—from the 1980 Census of Population and similarly low estimates from the March Supplements to the Current Population Survey. Haber notes that the more extensive and detailed health questions in surveys such as the National Health Interview Surveys appear to increase the reported incidence of disability. The highest estimates are from surveys of the Social Security Administration.
5.
5. Ibid. See footnote 3 for a common definition of being severely disabled.
6.
6. Michael Grossman, “On the Concept of Health Capital and the Demand for Health,”Journal of Political Economy, 80:223-255 (Mar. 1972).
7.
7. Mitchell LaPlante, “The Demographics of Disability,” in The Americans with Disabilities Act: From Policy to Practice, ed. Jane West (New York: Milbank Memorial Fund, 1991), pp. 55-77 (hereafter cited as ADA).
8.
8. If no adjustments are made for age and education, the annual earnings of part-year disabled workers were 96.8 percent of earnings of nondisabled part-year workers. If age and schooling are held constant, the earnings are around 70 percent of those of similar non-disabled workers.
9.
But see also John Bound, “The Health and Earnings of Rejected Disability Insurance Applicants,”American Economic Review, 79:482-503 (June 1989). Bound has challenged the estimated size of the work disincentive effects of the Social Security Disability Insurance program by examining the work experience of individuals whose applications were denied.
10.
10. Walter Oi, “Three Paths from Disability to Poverty” (Technical Analysis Paper no. 57, U.S. Department of Labor, Assistant Secretary for Policy, Evaluation, and Research, Oct. 1978). This result was based on data from the 1972 wave of the Michigan Panel Survey of Income Dynamics. The participation rate for wives of severely disabled men was below that for wives of nondisabled men, which may reflect the need for more care.
11.
11. This is suggested in the time-allocation data examined by Frank Stafford and Gregg J. Duncan, “The Use of Time and Technology by Households in the United States,”Research in Labor Economics, ed. R. G. Ehrenberg (Greenwich, CT: JAI Press, 1980), 3:335-375.
12.
12. Gerben DeJong, Andrew Batavia, and R. Griss, “America's Neglected Health Minority: Working Age Persons with Disabilities,”Milbank Quarterly, 67(2) supp., pp. 311-351 (1989).
13.
13. Cited in Fredrick C. Collingnon, “The Role of Reasonable Accommodation in Employing Disabled Persons in Private Industry,”Disability and the Labor Market, ed. Berkowitz and Hill, pp. 196-241.
14.
14. The March 1988 data pertain to male workers and are reported in Benefield and McNeil, Labor Force Status, tab. 6, pp. 36-37. The Illinois survey is contained in Corinne Kirchner, Don Harkins, and Robert Esposito, “Issues and Strategies toward Improving Employment of Blind or Visually Impaired Persons in Illinois” (Report, American Foundation for the Blind, Mar. 1991).
15.
15. Barry V. Bye and Gerald F. Riley, “Eliminating the Medicare Waiting Period for Social Security Disabled Worker Beneficiaries,”Social Security Bulletin, 52:2-15 (May 1989).
16.
16. William G. Johnson and James Lambrinos, “Wage Discrimination against Handicapped Men and Women,”Journal of Human Resources, 20:264-277 (Spring 1985). The validity of their statistical procedure for estimating the discrimination component of the wage difference can be challenged. There are reasons other than employer discrimination that lead to differences in the coefficients of education, work experience, and other explanatory variables in their wage equation.
17.
17. Edward H. Yelin, “The Recent History and Immediate Future of Employment among Persons with Disabilities,” in ADA, ed. West, pp. 129-149.
18.
18. The results of this shift are reflected in a dramatic change in the structure of relative wages. The ratio of wages for college versus high school graduates as well as the wage ratio for men 45 versus 25 years old were both considerably higher in 1989 than they were in 1980. The studies that analyze these changes can be found in Marvin Kosters, Workers and Their Wages (Washington, DC: AEI Press, 1991).
19.
19. The regulations describe seven clauses to define the concept of essential functions.
20.
20. See Handbook: The Americans with Disabilities Act (Washington, DC: Government Printing Office, Oct. 1991), sec. 1630.4.
21.
Walter Y. Oi , “Labor as a Quasi-Fixed Factor,”Journal of Political Economy, 70:538-555 (Dec. 1962).
22.
22. Masanori Hashimoto and Ben T. Yu, “Specific Capital, Employment Contracts, and Wage Rigidity,”Bell Journal of Economics, 11:536-549 (1980).
23.
23. See Handbook: Americans with Disabilities Act.
24.
He admitted that if more disabled workers obtained jobs, the average accommodation costs would rise. T. Chirikos criticized the Berkeley study and argued that if the ADA is successful in expanding employment, there will be an even sharper rise in accommodation costs than that suggested by Collingnon. Thomas N. Chirikos, “The Economics of Employment,” in ADA, ed. West, pp. 150-179.
25.
Walter Oi , “Disability and a Workfare-Welfare Dilemma,” in ibid.
26.
26. Nancy Lee Jones, “Essential Requirements of the Act: A Short History and Overview,” in ADA, ed. West, pp. 25-54.
27.
27. Jane West, “The Social and Policy Context of the Act,” in ADA, ed. West, p. 8.
28.
28. In Oi, “Disability and a Workfare-Welfare Dilemma,” I conjectured that resources would be devoted to litigation instead of to producing goods and services. High punitive damages could induce some successful plaintiffs to choose retirement instead of returning to work. Class-action suits are unlikely, given the case-by-case determination of disability.
29.
29. Richard V. Burkhauser, “Morality on the Cheap: The Americans with Disabilities Act,”Regulation, 13:47-56 (Summer 1990).
