Those with disabilities see a fourth-quarter 14.8 percent unemployment rate, 60 percent higher than unemployment rate for other workers
Belleville, Ill. – January 19, 2010 – Throughout 2009, unemployment for people with disabilities continued to significantly outpace the high unemployment rate other workers experienced, according to a quarterly study by Allsup, a nationwide provider of Social Security disability representation and Medicare services.
The
Allsup Disability Study: Income at Risk shows the number of people applying for Social Security Disability Insurance (SSDI) benefits continues to climb, reaching a record-high 2.8 million applicants in 2009; the highest ever recorded and the highest year-over-year increase. Chronic illness and other disabling conditions force thousands of people to leave their jobs each month. In addition, rising SSDI applications may be a result of individuals with worsening disabilities who have been out of work because of the recession and now realize they are medically unable to return to work.
The fourth-quarter Allsup study shows unemployment averaged 14.8 percent for people with disabilities, compared to 9.3 percent for people with no disabilities, according to non-seasonally adjusted data from the U.S. Department of Labor.
On average, in the past 12 months, people with disabilities experienced a 60 percent higher unemployment rate than those without disabilities.
Monthly unemployment rates for people with disabilities showed a slight easing since the record-high 16.9 percent rate in August. For October, the unemployment rate for people with disabilities was 16.5 percent, declining to 13.8 percent in December. Monthly unemployment rates for people with no disabilities, in comparison, ranged from 9.2 percent to 9.5 percent during the fourth quarter.
The Bureau of Labor Statistics also reported that in December about 40 percent of those unemployed had been jobless for 27 weeks or more.
“Enduring a lengthy period of unemployment is a challenge for all workers, but those with disabilities may experience worsening health conditions and other issues that can complicate their return to work,” said Paul Gada, personal financial planning director for Allsup.
“One of the common frustrations for people with disabilities is making the decision that they are not physically capable of returning to work, even though they have the desire,” said Gada. “Deciding to file for SSDI benefits becomes a necessity for financial reasons, but it’s not an easy choice to make.”
SSDI Applications Reach Record High; Highest Year-to-Year Claims Increase
The Allsup Disability Study: Income at Risk shows that the number of people with disabilities unable to work and applying for SSDI continues to climb. Disability applications rose to 2,816,244 during 2009 compared to 2,320,396 for 2008. This represents a 21.4 percent increase in initial SSDI claims year to year.
The Allsup study shows that SSDI claims generally have increased during the seven recession periods since 1969. With nearly 500,000 additional disabled workers applying for SSDI in 2009, it also represents the largest year-to-year increase in the number of new SSDI claims since the SSDI program began in 1956. In addition to the recession and high unemployment, the aging of the population also is likely contributing to the increase in applicants. As people age they are more likely to experience a disability or an increased severity of existing disabilities.
The Social Security Administration (SSA) estimates pending claims will grow to 1 million by fiscal year-end 2010. The SSA reports that more than 722,000 cases are pending at the hearing level, with an average wait time of 491 days.
“Deciding when to apply for SSDI is one of the most critical decisions for someone with a disability,” said Gada. “You may hold off with the hopes of returning to the work force, despite clear signs that you can’t work. But this puts you at even greater financial risk, particularly given how long the SSDI process can take.”
Securing Future Income
People unable to work due to a disability should become educated about the requirements for seeking SSDI benefits, said Gada. They also need to clearly understand the specific details of SSDI program provisions designed to help their finances. Among these are:
- Regular monthly income: SSDI is a regular monthly payment and usually provides annual cost-of-living increases (though none for 2010). In December, the average monthly benefit for a disabled worker was $1,064.
- Medical and prescription drug benefits: Regardless of age, 24 months after a person’s date of entitlement to SSDI cash benefits, he or she is eligible for Medicare.
- COBRA extension: Securing healthcare coverage prior to being eligible for Medicare is essential. People who receive SSDI benefits may be able to extend the length of their COBRA benefits an additional 11 months.
- Protected retirement benefits: SSDI ends at retirement age when recipients transition to Social Security retirement benefits. SSDI entitlement “freezes” Social Security earnings records during a person’s period of disability. Because the years in which a person collected SSDI benefits are not counted when computing future benefits, Social Security retirement benefits may be higher than if the earnings were averaged with those years of zero earnings.
- Dependent benefits: Dependents under age 18 of people receiving SSDI benefits may be eligible for benefits.
- Long-term disability benefits: People with private long-term disability insurance often are required to seek SSDI by the provider. Complying with this requirement could help protect their ability to receive long-term disability income and other benefits.
Individuals uncertain of their eligibility for SSDI benefits can contact the Allsup Disability Evaluation Center at (800) 279-4357 for a free evaluation.
About Allsup
Allsup is a nationwide provider of Social Security disability, Medicare and workers’ compensation services for individuals, employers and insurance carriers. Founded in 1984, Allsup employs more than 600 professionals who deliver specialized services supporting people with disabilities and seniors so they may lead lives that are as financially secure and as healthy as possible. The company is based in Belleville, Ill., near St. Louis. For more information, visit
www.Allsup.com.
The information provided is not intended as a substitute for legal or other professional services. Legal or other expert assistance should be sought before making any decision that may affect your situation.
Editor’s Note: Details on the Allsup Disability Study: Income at Risk are available at