The silent yet steady substitution of unemployment benefits with federal disability insurance is well covered in an episode of This American Life [1]. We, as a country, have a shoddy system for re-training low-skills workers facing technological obsolescence. We have also set up a system under which unemployment benefits are largely a state liability. Disability, on the other hand, is federally funded. The intersecti…
There is also an issue with disability benefits where they are structured with disincentives to work. The motivation to not pay disability to people who can work is understandable, but for people who can work some but whose disability hinders their ability to get a full-time job or one that's not highly paid, it's a disaster. http://marginalrevolution.com/marginalrevolution/2013/07/aid... This is a point that's not f…
What if we, as a society, could make it easier to obtain and sustain a good-paying job? Would people be still willing to go the route of disability? Maybe there are few jobs that many people can get. Or, maybe the 'costs' associated with working are too high. There's considerable social stigma for being 'disabled'' - why would someone take on that stigma?
I'm guessing that people are making a rational cost / benefit analysis.