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Home Publications Blogs Beat the Press WSJ Finds the Real Cause of Weak Recovery: Disabled Workers

WSJ Finds the Real Cause of Weak Recovery: Disabled Workers

Monday, 08 April 2013 09:07

Folks who follow the economy might have thought that cutbacks in government spending, the continued weakness of construction, or the large trade deficits were the causes of the slow recovery, but the WSJ has the real scoop: it's workers going on disability. The WSJ ran a piece headlined,"Workers Stuck in Disability Stunt Economic Recovery," that told readers:

"The unexpectedly large number of American workers who piled into the Social Security Administration's disability program during the recession and its aftermath threatens to cost the economy tens of billions a year in lost wages and diminished tax revenues.

Signs of the problem surfaced Friday, in a dismal jobs report that showed U.S. labor force participation rates falling last month to the lowest levels since 1979, the wrong direction for an economy that instead needs new legions of working men and women to drive growth and sustain a baby boomer generation headed to retirement"

Let's see how this one is supposed to work. According to the Bureau of Labor Statistics were 11.7 million people who were counted as unemployed last month. This means that they were actively looking for work. On the other hand, a separate survey of firms showed that there were 3.3 million job openings. This means that there were 3.2 workers looking for jobs for every opening that was listed. We also know that there are millions of other workers who would like a job, and are not on disability, but have given up looking for work because they don't see any jobs available.

Okay, so now we put the Wall Street Journal's news division in charge of the disability program and they throw 9 million workers off disability. How exactly does this create more jobs? Are the companies that were already seeing many applicants for each job openings going to start offering more jobs when this ratio increases further?

Keep in mind that most of the additional applicants do have serious disabilities, only 40 percent of applicants for disability are approved, as the WSJ article notes. Also, one-third of these had to go through an appeals process. So almost all of these people will have some condition that at least seriously impairs their work ability, even if it does not make it altogether impossible to work.

So the WSJ apparently wants us to believe that when these 9 million people are thrown off disability -- people with bad backs, severe fatigue, terminal cancer -- companies will suddenly start offering millions of additional jobs. That's an interesting economic theory.

Comments (4)Add Comment
written by PeonInChief, April 08, 2013 10:34
More important than the fact that a disability might seriously impair their ability to work is the fact that employers who have choices (3.2 workers per available job) would not hire people who require accommodation. And it's very difficult for a disabled worker to prove discrimination when there are so many other workers lined up.
Job Creating Brainpower of 9 Million Disabled Rescued by Obama and WSJ
written by Last Mover, April 08, 2013 12:04
Okay, so now we put the Wall Street Journal's news division in charge of the disability program and they throw 9 million workers off disability. How exactly does this create more jobs?

Has Dean Baker gone completely daft? Doesn't he realize that Obama is all over this like flies on dog poop?

Specifically, Obama with remarkable foresight predicted that the sudden growth in SS disability payments was effectively the same as a brain drain of productive resources from the economy, since most disabled still have sufficient brain power to be productive makers instead of moocher takers.

That's why Obama set up a program to map brains of the disabled along with everyone else so areas responsible for productive making and incentives to be productive from the supply side can be copied and implanted into brains of moochers born without these essential genes of successful capitalists.

Dean Baker just can't appreciate the genius of the WSJ. Those 9 million workers are not yanked off disability and tossed onto a landfill of heartless humanity with no hope of ever earning another dime.

No way. Those workers will earn their keep byselling copyrighted copies of their data mined brains thanks to the insight of Obama and the WSJ, and no thanks at all to Dean Baker, basher of copyrights and other essential property right drivers of capitalism.
WSJ is in a different calendar zone
written by nassim Sabba, April 08, 2013 12:52
Indeed that article would have been great if published exactly a week ago, on April 1.
Supply Side Theory
written by john h, April 08, 2013 7:46
maybe all the applicants can go into the harbor and the water displaced will make everyones' boats rise ?


supply more applicants for fewer jobs so that wages and benefits will trickle down.

reminds of heritage found. "govt. dependence" study touted by conservatives that shows avg. total benefits of a person receiving govt. aid add up to $32k and draw the conclusions that too many people are dependent at too high of a level on the govt. and that this must be changed.

what would these geniuses have the folks who need this money to survive suggest since either the jobs arent there, or dont pay enough to live ?

seems more like an argument for "basic income" or living wage to me.

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About Beat the Press

Dean Baker is co-director of the Center for Economic and Policy Research in Washington, D.C. He is the author of several books, his latest being The End of Loser Liberalism: Making Markets Progressive. Read more about Dean.