Examining the relevance of employment integration policies on disability benefit receipt: a multilevel analysis of older working age adults in 16 countries

Abstract

Purpose: Nearly all advanced economic countries have adopted employment integration policies to improve the labor market outcomes of workers with disabilities and to reduce enrollment on disability benefits. To date, research has yet to investigate whether the adoption of integration policies is associated with a reduced likelihood of an older working age adult receiving disability benefits.

Materials and methods: This study, drawing on data of older working-age adults from the Survey of Health Ageing and Retirement in Europe, the English Longitudinal Study of Ageing, and the Health and Retirement Study, applies multilevel logistic regression to investigate the relationship between country-level integration policies and the likelihood of disability benefit receipt in 16 OECD countries.

Results: No clear association was identified between the adoption of major integration policies (comprehensiveness of vocational rehabilitation systems, employer obligation policies, work-incentive rules, benefit suspension options, and early intervention efforts) and an individual’s likelihood of receiving disability benefits. The minimum level of disability required to receive benefits was, however, identified as a significant country-level factor.

Conclusions: The findings of this study may prove useful for policy makers who must weigh the costs and benefits of expanding integration measures targeted at those nearing the state pension age.

Implications for Rehabilitation

• Many countries have adopted integration policies to improve employment outcomes of adults with work-disabilities.

• No clear association is identified between the adoption of integration policies and a reduced likelihood of receiving disability benefits among older adults in 16 countries.

• The strictness of the definition of disability used to determine eligibility is identified as a significant country-level predictor.

• Policy makers should carefully weigh the costs and benefits of expanding integration measures targeted at those nearing the state pension age.

Keywords:

• Disability policy
• rehabilitation
• multilevel modeling
• comparative social policy
• OECD

Disclosure statement

No potential conflict of interest was reported by the authors.

Notes

1 See also Börsch-Supan et al. [11] for a more recent study demonstrating the relevance of compensation policies for understanding the cross-country variation in rates of disability benefit receipt. It is important to note that these studies focus on the effects of compensation policies and do not explore the integration policy dimension that is the focus of this study.

2 Data on the pension ages in each country came from OECD [37].

3 SHARE data for Estonia, Ireland, Israel, and Slovenia were not included because policy scores were not assigned by the OECD and Sweden was not included because a scoring issue was identified with the employer obligation variable. Sweden had the highest score for employer obligations among all countries yet requires considerably less from employers than other SHARE countries, particularly the Netherlands [24].

4 A limitation of this policy variable, which was produced by the OECD, is that it does not consider whether and to what extent environmental factors weigh into eligibility decisions [25].

5 As an additional sensitivity analysis, all regression analyses were also conducted using a probit model. The results did not differ substantively from the logistic regression results and are available upon request.

6 The default of 12 quadrature points was used with the Xtlogit command in Stata for the random effects regression in Model 1. A sensitivity test of the quadrature using the Quadchk command in STATA 15 for 8 and 16 quadrature points found no difference in the estimate of the log of the variance of the random component.

Additional information

Funding

This work was supported by a fellowship from the Disability Research Consortium of the Social Security Administration.