As Unemployment Runs Out, Disability Applications Go Up

I don't think this is as simple as people faking injuries in order to stay afloat. A lot of middle-aged people with disabilities would rather work, and used to be able to find jobs that made working possible. Now the options have been choked off (along with their health insurance) and health conditions are getting worse, as they tend to do with age. But of course that's not how the politicians will spin it. The Wall St. Journal:

Many poor Americans seek Social Security disability payments as a financial life preserver when their unemployment benefits begin expiring, preliminary research by two economists shows.

The findings, released by the Obama administration Thursday, are based on interviews with unemployed workers for a study conducted by White House Council of Economic Advisers Director Alan Krueger and Andreas Mueller of Columbia Business School. Mr. Krueger recently joined the White House from his post teaching economics at Princeton University.

The findings offer a new window both into the struggles of the poor and the growing financial strain of one of the country’s largest entitlement programs.

Their research found that close to 10% of Americans between the ages of 50 and 65 who didn’t have access to at least $5,000 applied for Social Security disability benefits by the time their unemployment benefits were set to expire. The percent of this group seeking the benefits rose precipitously in the weeks leading up to the exhaustion of benefits, as it was below 1% with 50 weeks left in unemployment benefits.

Jobless Americans in this age range who had access to at least $5,000 were much less likely to seek SSDI benefits at any point while collecting unemployment benefits.

There has long been a relationship between unemployment rates and applications for disability benefits, with more Americans seeking entry into the program when it’s harder to find a job.


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