JOB SEARCH / JAN. 08, 2015
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Study Says Disabled Veterans are Discouraged from Seeking Employment

Research has found that as disability enrollment increases, job entry for U.S. military veterans decreases.

Economist Mark Duggan from Stanford discovered that the two trends are completely opposite from each other.

"During the 1980s and 1990s, veterans were significantly more likely to work than were non-veterans. Today, the opposite is true," Duggan recorded in his research.

The economist started his investigation by looking at the number of enrolled veterans between 1950 and 2000. He then analyzed statistics dating from 2001 to 2014.

Throughout his study, Duggan found that:

  • Compared to the 18 percent of people who are currently enrolled, up to 10 percent were part of the program between the 50-year period.
  • During the 1990s until now, one in four veterans receive disability assistance compared to one in seven of previous service eras. 
  • In 2001, there were 2.3 million enrollees compared to 3.9 million in 2014.

Surprisingly, enrollment still enlarged from 2001 until 2014 even after the military veteran population dropped by 16 percent.

Duggan also compared the percentage of veterans versus non-veterans in the workforce during separate 4-year time periods:

From 2000 to 2004 there was a 0.9 percentage gap. 2005 to 2009 there was a 1.7 percentage gap. And from 2010 to 2014 there was a 4.3 percentage gap.

The number of veterans in the job market has obviously decreased over time.

Duggan described several factors that may play a role in this change.

1. Disability Compensation Has Increased

He says that the main reason behind this correlation is the rise in today’s disability compensation. Since most veterans are aware of the federal disability program’s financial upsurge, it has discouraged them from seeking employment altogether.

Duggan mentions in his study how a “reduction in labor force participation among veterans closely coincides with their increase in disability compensation enrollment,” especially during the new millennium.

2. Disability Coverage Expanded

Coverage has expanded since 2010, becoming much easier to apply for in recent years. The program now covers more disabilities than before. This change has prompted a large number of military veterans to leave the workforce.

3. Veterans Tend to Work for the Government Sector

For the past seven years, government jobs have been failing growth wise. Since most veterans typically work for the government on a local or national level, it’s harder for most former servicemen and women to find a job in the private sector.

4. The Military Causes More Harm Than Good

Military duties may be more demanding now than it was in previous years. This could be the reason that more people have claimed disability.

Duggan says that two philosophies contribute to the staggering numbers of working veterans:  “income effect” and “substitution effect.”

The “income effect” refers to a person’s refusal to find work because they have now found satisfaction in freedom while they receive additional income from the government. Coincidently, veterans may also view their circumstance from a “substitution effect” perspective. Meaning, additional work may take away from the maximum amount of disability benefits they may be eligible for under the program.

Evidence also reveals a disappointing truth.

Following the Vietnam War, disability enrollment continued to climb. As a result, veterans of today are more likely to be out of work and receive disability benefits than earlier predecessors.

Image: iStock

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