In a recent study performed by the University of Nebraska-Lincoln, researchers uncovered that males who apply, and are ultimately rejected for, Social Security Disability benefits tend to have lower earnings in the decade prior to making their SSD application than do men who are approved for benefits.
According to the study, men who were denied Social Security benefits made 8.5 less than those who were ultimately approved for benefits six years before both groups applied. In the months leading up to the application, denied applicants made 22 percent less than those who were approved.
In addition, the study stated, applicants who were rejected tended to participate in the labor force much less than approved applicants, and left jobs more quickly as the application date approached.
Economics professor Seth Giertz, who led the research, attempted to explain the results. “Financial factors may be a driving factor in a large number of disability applications,” he said. “Federal disability programs have undergone tremendous growth in recent decades and appear to be discouraging able-bodied adults from staying in the labor force.”
However, there are many alternate theories as to the reason for the disparity. One is the nature of the rejected applicants’ disabilities. Perhaps the applicants were suffering from mental illnesses, substance abuse, and other diseases that are more difficult to diagnose and treat.
If this is the case, their lowered earnings and decreased time spent in the work force could be indicative of life-long struggles with their disabilities, instead of their finances and eagerness to receive federal benefits for their disabilities. As those who receive Social Security Disability benefits well know, the average disability payment is meager at best – usually averaging $1,000 per month. It seems implausible that an adult would voluntarily remove himself from the work force just to receive those slight benefits.
Source: Newswire, “Study Uncovers Much Different Work Histories for Disability Rejects, Beneficiaries,” 23 May 2011