Disabled Workers Saw Record Employment Gains in 2023, But Gaps Remain

Authors’ note: The disability community is rapidly evolving to use identity-first language in place of person-first language. This is because it views disability as being a core component of identity, much like race and gender. Some members of the community, such as people with intellectual and developmental disabilities, prefer person-first language. In this column, the terms are used interchangeably.

Today, the U.S. Bureau of Labor Statistics released its annual review of people with disabilities in the labor market. The review illustrates the workforce advancements that people with disabilities made in 2023 and highlights the gaps they still face. This column describes notable findings from the data release to provide insight into disabled workers’ labor market experiences. During the economic recovery from the COVID-19 pandemic, a tight labor market has emerged, alongside increased telework options. This has helped improve disabled workers’ employment rates, which rose to record highs in 2023. Also in 2023, on average, disabled workers’ unemployment rates fell to a record low.

Despite these record gains, however, stubborn gaps remain. Disabled workers still experience an unemployment rate that is twice as high as that of workers without a disability, and they remain considerably less likely to be employed.

Employment rate for disabled people hit record high in 2023

During the labor market recovery following the COVID-19 pandemic, disabled people have made notable employment gains, benefiting from opportunities created by tight labor market conditions and increased workplace flexibilities such as telework. Employment rates for working-age disabled women and men hit record highs in 2023—36.1 percent and 38.2 percent, respectively. (see Figure 1) Notably, disabled women have seen the largest improvements in their employment rates compared with pre-pandemic, reducing the gender gap between disabled men and women. Gaps in employment rates for workers ages 16 to 64, both with and without a disability, also fell to record lows.

Despite these gains, however, working-age disabled women and men still have significantly lower employment rates—around half the rates of their counterparts without disabilities. (see Figure 1) Including adults ages 65 and older further widens the gap. Strikingly, when people of all ages are included, those without disabilities were three times more likely to be employed in 2023 than those with disabilities: The average annual employment rate for people without disabilities was 65.8 percent, while the rate for people with disabilities was 22.5 percent. Moreover, Asian workers with disabilities have the lowest employment rate compared with other racial and ethnic groups, and are the one group whose employment rate has not increased or recovered following the pandemic. From 2019 to 2023, the employment rate of Asian people with disabilities fell by 1.7 percentage points. Such gaps in employment rates reveal a large swath of the disabled community that may be discouraged from looking for employment and are untethered from the labor market.

The unemployment rate for disabled people has fallen to record lows

In 2023, the unemployment rate for disabled people was, on average, a record low of 7.2 percent. (see Figure 3) Yet disabled people actively seeking work still struggled to obtain employment at much higher rates than nondisabled people. Their record-low unemployment rate of 7.2 percent was still around twice as high as the 3.5 percent experienced by nondisabled people. This unemployment gap demonstrates the additional barriers that disabled people face during the job search process, including the difficulties of finding a job that fits their skill sets or offers the accommodations necessary to perform the role as well as the harmful effects of discrimination.

Notably, Black and Hispanic disabled people experienced higher unemployment rates in 2023—at 10.2 percent and 9.2 percent, respectively. The unemployment rates of these groups are consistently above the average for disabled workers, due to the additional hardships of intersecting and compounding racism and ableism; they also reflect the disparities in employment seen in the labor market overall.

People with disabilities are almost twice as likely to work part time

In 2023, 29 percent of disabled workers worked part time—their lowest rate on record but still higher than the 16 percent of workers without disabilities who do so. Historically, people with disabilities have been more likely to work part time, at a rate nearly double that of the population without disabilities. (see Figure 4) This is due in part to occupational segregation, where disabled workers are more likely to work in industries that commonly offer more part-time positions. In 2023, disabled workers were more likely than nondisabled workers to be employed in service occupations such as food services and health care support, maintenance occupations, and retail trade.

The concentration of disabled workers in low-wage and part-time positions contributes to a wage gap in which people with a disability earn a median wage of 66 cents for every $1 made by people without a disability. This wage gap is exacerbated by Section 14(c) of the Fair Labor Standards Act, which allows employers to pay disabled workers less than the federal minimum wage of $7.25 per hour. Furthermore, the government benefit programs on which many disabled people rely, such as Medicaid and Supplemental Security Income (SSI), have low asset and/or income limits that penalize disabled people for working and saving money. Asset and income limits prevent disabled people from achieving basic economic security without risking the loss of crucial support systems—forcing many people into part-time work. These limits combine with low pay to lead to increased rates of poverty and a wealth gap between people with and without disabilities.

Conclusion

The Bureau of Labor Statistics’ 2023 review of people with disabilities in the labor force revealed that disabled people made notable gains in the labor market despite the persistence of barriers to becoming and staying employed. In order to close the remaining gaps in the labor market, however, policymakers must implement strong worker protections and create a labor force that works with and for disabled people. They can do this by:

• Increasing funding to programs in the Retaining Employment and Talent after Injury/Illness Network (RETAIN), which help newly disabled people remain at their place of employment after becoming chronically ill or disabled.
• Increasing workplace accommodations, including by addressing air quality, continuing to provide telework opportunities, and guaranteeing paid sick leave and paid family and medical leave.
• Strengthening employee protections by passing the Protecting the Right to Organize (PRO) Act and enhancing the U.S. Department of Labor’s ability to enforce workplace classification laws.
• Increasing investments in data collection surrounding disabled people’s experiences in the labor market as well as into the impacts of long COVID.
• Raising the minimum wage to at least $17 per hour.
• Eliminating Section 14(c) of the Fair Labor Standards Act.
• Updating social safety net programs, including by raising asset limits for programs such as SSI.

* Analysis is based on Table 9 from Week 63 of the Census Bureau’s Household Pulse Survey.

The authors would like to thank Mia Ives-Rublee and Lily Roberts for helpful feedback and David Correa for fact-checking.