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Changes in wage discrimination against people with disabilities (DeLeire 2000)

Citation

DeLeire, T. (2000). Changes in wage discrimination against people with disabilities: 1984–93. The Journal of Human Resources, 37(1), 144-158.

Highlights

  • The study’s objective was to estimate changes in wage discrimination against people with disabilities before and after the Americans with Disabilities Act of 1990 (ADA). 
  • The author used data from the 1984, 1992, and 1993 panels of the Survey of Income and Program Participation to compare earnings for people who reported functional and work limitations, people who reported only functional limitations, and people who reported no limitations. The percentage of the gap between the first two groups that was not explained by control variables and self-reported health status was attributed to discrimination, and that percentage was compared between 1984 and 1993 to estimate the effect of the ADA.
  • The study found earnings gaps between people with no disabilities and those with work limitations and/or functional limitations in each year, and the share of the gap explained by discrimination rose slightly after passage of the ADA.
  • The quality of causal evidence provided in this study is low. This means that we are not confident that the estimated effects were attributable to the passage of the ADA; other factors are likely to have contributed.

Intervention Examined

The Americans with Disabilities Act of 1990

Features of the Intervention

The ADA prohibits discrimination against persons with disabilities. Enacted in July 1990 and first implemented in January 1992, the law bars employers from discriminating against persons with disabilities in all aspects of employment, including hiring, firing, wages, and training. The legislation also requires employers to provide reasonable accommodations to help employees with disabilities complete the functions of their jobs, provided the accommodations do not impose undue hardship on the employer. Reasonable accommodations may include adjusting work schedules or equipment, providing qualified readers or interpreters, or modifying facilities to improve accessibility. When the ADA first went into effect in 1992, it applied to government employers and private employers with 25 or more employees; an addendum in 1994 extended coverage to private employers with 15 or more employees.

Features of the Study

This study examined the effect of the ADA on the share of the disability wage gap explained by discrimination rather than by health status, productivity, or other factors using data from the Survey of Income and Program Participation. Using a wage decomposition procedure, the author first compared wages of people who reported both functional and work limitations to those of people without those limitations to determine the extent of wage differences that were unexplained by individual-level demographic, self-reported health, and job-related control variables. (Functional limitations were defined as difficulties with an activity of daily living and could include wheelchair or long-term cane use.) The unexplained differences could be attributed to both productivity differences and discrimination. Second, by estimating a similar model comparing wages of people who reported only functional limitations to those of people without functional limitations, who are assumed to have similar productivity at work, the author identified the extent of wage differences due to discrimination only. The gap in the wage differences computed from the two models could then be attributed to productivity differences.

The author compared the percentage of the wage gap between workers with and without limitations that was attributed to discrimination between 1984 and 1993 to assess the effect of the ADA on discrimination. The analyses were based on data from all states.

Findings

  • The study found that the earnings of workers with both functional and work limitations were significantly lower than those of workers without those limitations by about 28 percent in 1984 and 42 percent in 1993. The earnings of workers with only a functional disability were significantly lower than those of workers without a functional disability by about 8 percent in 1984 and 10 percent in 1993.
  • In 1984, 5 percent of the disability wage gap was attributed to discrimination. In 1993, 8.1 percent of the disability wage gap was attributed to discrimination. This increase suggested little impact of the passage of the ADA in 1990 on the extent of wage discrimination against persons with disabilities.

Considerations for Interpreting the Findings

This study relied on a number of assumptions about the comparability of the groups analyzed in terms of productivity and disability status. If these assumptions were not met, the percentage of the wage gap attributed to discrimination might be biased either up or down. For example, the study assumed that people with both functional and work limitations did not have more severe disabilities than those with only functional limitations. If their disabilities were more severe, it might be inappropriate to assume they faced the same levels of wage discrimination. In addition, the study assumed that a person with a functional limitation but no work limitation was no different in terms of productivity than a person with neither limitation after controlling for self-reported health status. If functional limitations had an effect on productivity at work beyond the effect of work limitations, it might be inappropriate to assume that the unexplained difference in wages between those with only functional limitations and the those with no limitations reflected only the effect of discrimination.

Causal Evidence Rating

The quality of causal evidence provided in this study is low. This means that we are not confident that the estimated effects were attributable to passage of the ADA; other factors are likely to have contributed.

Reviewed by CLEAR

August 2015

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