Disabled people make up just over a fifth of the UK working age population but tend to have lower levels of employment. Although discrimination against disabled people is illegal by law, employment gaps remain and policy interventions are needed to reduce inequalities.
Employment rates for people with disabilities are generally lower than for people without disabilities. This trend, observed around the world, is known as the disability employment gap and is an important indicator of disability-related inequalities in the labour market.
Monitoring and identifying the causes of the employment gap for people with disabilities provides insight into how to address the gap.
Definition of disability
Although the concept and measurement of disability is subject to debate, disability is generally defined as the presence of a limiting long-term health problem. For example, according to the UK Equality Act (Equality Act 2010), disabled people are defined as people who have a health problem that has a significant and long-term adverse effect on their normal daily activities. This includes both physical and mental health problems.
Information on disability in the UK is collected through household surveys, with individuals assessing their own health status and activity limitations against this definition. As defined by the Equality Act, 23% of the UK’s working age population are disabled ( UK Office for National Statistics, ONS, 2023 ). Over the past decade, the prevalence of disability has been increasing (see Figure 1 ).
Figure 1: Prevalence of disability among the UK working age population, 2013-23 Source: Analysis of A08: Labour market status of people with disabilities, Labour Force Survey, UK Office for National Statistics (ONS)
What is the disability employment gap?
Recent labour shortages, driven in part by an increasing proportion of the population out of the labour market due to long-term health conditions, have focused renewed attention on labour market outcomes for people with disabilities.
One key measure of disability-related labor market inequality is the disability employment gap (also known as the DEG), which is the percentage point difference between the average employment rates of working-age people without disabilities and people with disabilities.
Higher values ​​correspond with lower relative employment rates for disabled people or greater inequality. Current estimates based on the Labour Force Survey, the UK’s largest household survey, suggest a DEG of 30 percentage points, with an employment rate of 53% for disabled people, significantly lower than the employment rate for non-disabled people (83%).
There is evidence of DEG in many developed countries and it persists in the UK labour market. This is despite the fact that disability is a protected characteristic in equality law, making discrimination against disabled people illegal.
This gap persists despite various government policies, including welfare benefit reforms aimed at increasing employment rates for people with disabilities.
The average DEG hides differences between regions and subgroups with different individual and disability-related characteristics: for example, the DEG is wider among people with fewer educational qualifications or more severe disabilities.
Nevertheless, the DEGs serve as a useful summary indicator to explore the drivers of disability and monitor trends over time. The DEGs are also a key indicator used by the UK government to track progress on disability-related inequalities.
This had previously been a formal policy target: in 2015 the government committed to halving the DEG from 33 percentage points, though it was later reversed.
What factors explain the DEGs?
DEG is related to disability-related disparities in finding employment (job seekers) and maintaining employment (existing workers).
The DEG explanation includes the idea that people with disabilities face pre-existing disadvantages, meaning that they may have different attributes, such as qualifications, even before their disability occurs.
It is also argued that disability may alter work capacities, abilities and even work preferences, such as those arising from changes in the value of leisure time or changes in eligibility for government welfare assistance, including disability benefits.
In practice, DEGs are often divided into two parts.
The first part is due to the composition, or differences, of the average characteristics of disabled and non-disabled people. A good example is that disabled people in the UK have, on average, lower qualifications than non-disabled people, which causes the DEG to widen.
The second component is the DEG that exists even after accounting for differences in characteristics such as education. In other words, it is the component of the DEG that exists between otherwise comparable disabled and non-disabled individuals.
In the UK, both disability-related characteristic differences and disability-related differences in employment between comparable individuals contribute to the DEG, but isolating the specifics of the latter is difficult – for example, it is difficult to separate the role of employer discrimination from other disability-related differences in work preferences or workplace productivity, because these are all typically difficult to measure.
Attempts have been made to identify discrimination by examining DEGs among subgroups of people with disabilities, including those with stronger and weaker disabilities, which are associated with workplace prejudice and productivity.
However, the best way to identify employer discrimination is to use experimental research methods that send comparable job applications to fictitious disabled and able-bodied individuals and track employers’ responses.
While these studies tend to focus on recruitment and relate to specific types of disability in specific occupations, the evidence is consistent with discrimination against people with disabilities (Bellemare et al., 2023; Ameri et al., 2017). Evidence shows that people with disabilities receive fewer interview invitations than non-disabled people with comparable qualifications and work experience.
What are the other key indicators of disability-related labour market inequality?
Disability-related labour market inequalities are not limited to obtaining and keeping a job: there is also evidence that disability is associated with wage gaps and job satisfaction disparities among employed people.
In terms of average (median) hourly wages, disabled employees in the UK earn around 14% less than non-disabled employees (ONS, 2021). These disparities are partly due to differences in the personal and work-related characteristics of disabled and non-disabled people, but cannot be fully explained by them.
Important questions remain about the extent to which these disparities vary by employer and its characteristics: evidence from the US supports the idea that employers influence outcomes, with disability disparities in work-related outcomes being narrower in workplaces that are perceived as fair to all employees ( Schur et al., 2009 ).
Recently, the UK Government launched a consultation on workforce reporting on disability, which will require employers to measure and report on the prevalence of disability among their employees and disability-related outcomes.
Similar to the Gender Pay Gap Transparency Act introduced in the UK in 2017, this could include publishing disability-related pay gaps within organisations, allowing employers to compare themselves with others.
What happened during Covid-19?
While it is always difficult to separate the impact of COVID-19 from longer-term trends, the DEGs stagnated during the pandemic, ending an earlier trend of decline (see Figure 2), while at the same time, the prevalence of disorders continued to increase (see Figure 1).
Figure 2: DEGs in the UK working age population 2013-23 Source: Analysis of A08: Labour market status of people with disabilities, Labour Force Survey, UK Office for National Statistics (ONS)
As such, the total number of job losses due to disability in the UK has increased since 2020. This trend has raised wider policy concerns beyond labour market inequalities, including debates about the impact of DEG on economic growth ( Haskel and Martin, 2022 ).
Increased remote working is one feature of the pandemic that has been suggested may improve the long-term prospects of people with disabilities in the labour market.
Arguments include that disabled people disproportionately benefit from increased flexibility and shorter commute times. So far, the evidence on this is inconclusive.
There are certainly reasons to be cautious: people with disabilities are less likely to hold higher-skilled, higher-paid jobs that offer more opportunities to work from home (Hoque and Bacon, 2021). Moreover, it is not yet clear what the long-term impacts of working from home will be on individuals’ careers.
Recommendations
There is a lack of evidence about what works to increase employment rates for disabled people in the UK, but it is clear that without significant intervention in the form of government policy or changes in employer practice, DEG is likely to persist.
As disability prevalence continues to rise, it will have an increasingly significant impact on economic performance and government welfare spending. Strengthening policy, employer and public awareness, recognition and understanding of disability-related inequalities in the workplace is therefore crucial.
Where can I find more information?
Who are the experts on this issue?
Mark BryanMelanie JonesDuncan McVicarJenny RobertsVicky WassAuthor: Melanie JonesPhoto: inside-studio for iStock
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