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.