The effect of labor market conditions on disability applications and awards

The U.S. Social Security Disability Insurance (SSDI) program is designed to provide income support to workers who become unable to work because of a severe, long-lasting disability.  In this study, we use administrative data to estimate the effect of labor market conditions, as measured by the unemployment rate, on the number of SSDI applications, the number and composition of allowances and denials, and the timing of applications to disability onset.  We analyze the period of the Great Recession, and compare this period with business cycle effects over the past two decades, from 1992 through 2012.