Discussion of: 

The Effect of Job Displacement on DI Claims and Awards Over the Busine

BOB WEATHERS, SOCIAL SECURITY ADMINISTRATIONAUGUST 1, 2018
Key Findings:

Provides some preliminary evidence that workers impacted by mass layofapplication and awards rates than similar workers who are not directly imThe effect changes over time, and appears correlated with the cost of job relative generosity of the programCaveats and Possible Extensions:Is the construction of the counterfactual reasonable? Need to see more presentation that supports the “key assumption” as well as sensitivity anaPresentation should use “comparison group” instead of “control group” texperimental designMight be useful to examine the effect on the allowance rate (awards/app
Why Examine Factors Related to DI Application

Awards?Improve information base for DI projectionsAssess whether the program is working as intendeIdentify potential policy changes


Some combination of:

◦ Economy and labor market—temporary ◦ Drop in hearings level allowance rates—temporary? 

◦ Increased health care (ACA)◦ Field office consolidations◦ Attorney representation◦ Something more fundamental?

Reasons and relative magnitudes are important for understanding:

◦ Influence on DI projections and the financial status of the OASDI program

◦ Possible disability policy improvements 
(2) Is the DI Program Working as Intended?

Issues that might be further explored in the paper:◦ Identification of SSA disability not simple, requires evaluation of medical 

work capacity to arrive at a yes or no decision

◦ Might be some concern if the effect on awards rate matched application 

◦ Would be very useful to examine the effect on the allowance rate (awardPaper might also discuss implications of potential changes to the program:◦ GAO has recommended modernizing disability policy◦ SSA updating the occupational information used for making disability det
Source: Actuarial Note #153 “Disabled Worker Allowance Rates: Variation Under Changing E
(3) Disability Policy: Reducing Human Capi

Disability application and appeals process can take 1 to 2+ years

◦ Many applicants are not working to support their disability claim◦ Long periods out of the labor market may lead to decay in human 

Evidence that denied face challenges re­entering the labor market

◦ Autor, Maestas, Mullen, and Strand (2017) “Does delay cause de

What to do? Maybe additional employment support for:

◦ Displaced workers and others prior to disability application?◦ Applicants after an initial state DDS denial?◦ Denied disability applicants?
0

1020304050607080

10 9 8 7 6 5 4 3 2 1 

Years Before Application

The Case for Employment Support prior to Application: 

Earnings Above Annualized SGA Begin Decline Years Before Application

Claim allowedClaim denied

Source: Jackson Costa (2017) “The Decline in Earnings Prior to Application for DInsurance Benefits,” Social Security Bulletin, Vol. 77, No. 1.
Research addresses an important issue, and results will be informat

assessing both DI projections and disability policyInnovative use of administrative recordsPreliminary results show some effects, but I have some concerns abconstruction of the counterfactual and the sensitivity of the findingalternative specificationsIt might also be useful to examine effects on the allowance rate: Is displaced workers?The presentation represents a really good first step, I look forward tadditional results in the future