Income at Risk: Job Recovery Still Lagging for Those with Disabilities, Reports Allsup

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People with disabilities end 2010 with higher unemployment rate than 2009, SSDI applications reach record high.

Throughout 2010, unemployment for people with disabilities continued to significantly outpace the unemployment rate other workers experienced, according to a quarterly study by Allsup, a nationwide provider of Social Security disability representation and Medicare plan selection services.

The Allsup Disability Study: Income at Risk shows the number of people applying for Social Security Disability Insurance (SSDI) benefits continued to climb, reaching a record 2.9 million applicants in 2010. This is the highest on record since the SSDI program began in 1956. Chronic illness and other disabling conditions force thousands of people to leave their jobs each month. With high unemployment, many of these individuals may find they are out of work and have worsening disabilities making them medically unable to return to work.

The Allsup study shows unemployment averaged 14.5 percent in the fourth quarter for people with disabilities, compared to 8.9 percent for people with no disabilities, according to non-seasonally adjusted data from the U.S. Department of Labor. On average, in the past 12 months, people with disabilities experienced a 57 percent higher unemployment rate than those without disabilities.

Monthly unemployment rates for people with disabilities eased since peaking at 16.4 percent in July. However, the unemployment rate for people with disabilities ended 2010 at 14.3 percent, even higher than 13.8 percent at year-end 2009. Monthly unemployment rates for people with no disabilities, in comparison, declined from 9.5 percent in December 2009 to 8.9 percent in December 2010.

The U.S. Bureau of Labor Statistics also reported that in December about 44 percent of unemployed workers, or 6.4 million, had been jobless for 27 weeks or more. This is up from 2.6 million in 2008 when Allsup issued its first study on disability and unemployment.

“A common frustration for people with disabilities is coming to the realization that they are not physically capable of returning to work,” said Paul Gada, personal financial planning director for the Allsup Disability Life Planning Center.

SSDI Applications Reach Record High: Boomers, Illness and Unemployment

The Allsup Disability Study: Income at Risk shows that the number of people with disabilities unable to work and applying for SSDI continues to climb. Disability applications rose to 2,935,798 during 2010 compared to 2,816,244 for 2009. This represents a 4.2 percent increase in initial SSDI claims year to year.

The Allsup study also tracks the general increase in SSDI claims through the past seven recessions since 1969. While the latest recession officially ended in June 2009, high unemployment rates continued in 2010. The aging of the population also is likely contributing to the increase in SSDI applicants, with the average age of people applying for disability close to 53—about midway in the baby boom generation. As people age they are more likely to experience a disability or an increased severity of existing disabilities.

“If you have put 30 or 40 years into working, it can be difficult to admit a disability is forcing you out of the labor market. Some people delay applying for SSDI benefits in the hopes that they can return to work and retire on their own terms,” Gada said. “However, if there are clear signs that you can’t work, delaying applying for SSDI puts you—and your retirement—at even greater financial risk.”

Securing Future Income

People unable to work due to a disability should learn more about the requirements for seeking SSDI benefits, said Gada. Allsup provides more information with an overview of SSDI on Individuals also need to clearly understand the specific details of SSDI program provisions designed to help their finances. Among these are:

  •     Regular monthly income: In December, the average monthly benefit for a disabled worker was $1,068.
  •     Medical and prescription drug benefits: Regardless of age, 24 months after a person’s date of entitlement to SSDI cash benefits, he or she is eligible for Medicare.
  •     COBRA extension: Securing healthcare coverage prior to being eligible for Medicare is essential. People who receive SSDI benefits may be able to extend the length of their COBRA benefits an additional 11 months.
  •     Protected retirement benefits: SSDI ends at retirement age when recipients transition to Social Security retirement benefits. SSDI entitlement “freezes” Social Security earnings records during a person’s period of disability. Because the years in which a person collected SSDI benefits are not counted when computing future benefits, Social Security retirement benefits may be higher than if the earnings were averaged with those years of zero earnings.
  •     Dependent benefits: If someone receiving SSDI benefits has dependents under age 18, they also may be eligible for benefits.
  •     Long-term disability benefits: People with private long-term disability insurance often are required to seek SSDI by the provider. Complying with this requirement could help protect their ability to receive long-term disability income and other benefits.

If you have questions about your eligibility for SSDI benefits, please contact the Allsup Disability Evaluation Center at (800) 279-4357 for a free disability evaluation.

About Allsup
Allsup is a nationwide provider of Social Security disability, Medicare and Medicare Secondary Payer compliance services for individuals, employers and insurance carriers. Founded in 1984, Allsup employs more than 700 professionals who deliver specialized services supporting people with disabilities and seniors so they may lead lives that are as financially secure and as healthy as possible. The company is based in Belleville, Ill., near St. Louis. For more information, visit

The information provided is not intended as a substitute for legal or other professional services. Legal or other expert assistance should be sought before making any decision that may affect your situation.

Editor’s Note: Details on the Allsup Disability Study: Income at Risk are available at Fourth quarter 2010:


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