As policymakers consider how to replenish the fund that pays for Social Security Disability Insurance (DI), they should understand why the rolls have grown. Nearly 9 million disabled workers received DI at the end of 2014, roughly three times the 1980 figure of 2.9 million. Five demographic factors explain fully two-thirds of that growth.
(For more about these factors — and why some scholars, including economists David Autor and Mark Duggan and researchers at the Federal Reserve Bank of San Francisco, report a smaller demographic contribution — see our earlier paper here.)
In sum, these five demographic factors alone would have generated over 4.1 million more DI beneficiaries in 2014 — causing their number to rise from 1980’s 2.9 million to 7 million. That leaves fewer than 2 million beneficiaries tied to other factors.
The Social Security actuaries express the number of people receiving DI using a rate that adjusts for four of these five factors (though not for “women’s catchup”). Over the 1980-2014 period, that rate rose from 3.1 percent of the working-age population to 4.6 percent. That’s certainly a significant increase, but not nearly as dramatic as some have painted (see graph).
We’ll be back soon with many of the reasons for the rest of DI’s growth.