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Panelists: Benefit "cliff" discourages some people with disabilities from taking jobs
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Summary
Speakers at a meeting said fear, confusion and the math of lost benefits can make increased earnings unattractive for people receiving public disability supports; they urged clearer rules and simplification for employers and beneficiaries.
Speakers at a meeting discussed how the "benefit cliff"—the point at which small increases in earnings lead to large reductions in public benefits—discourages some people with disabilities from accepting work or taking on more hours.
Panelists said the effect is driven by both fear and simple arithmetic: beneficiaries sometimes face a net loss or negligible gain in income when benefits are reduced, and they also receive mixed or unclear guidance from agencies. That combination, speakers said, can keep people from pursuing employment or promotions.
"Fear is definitely part of it. There's no doubt about it," said Wallfish, a representative of Full Circle Employment, which works with people with disabilities. Wallfish testified that misconceptions and inconsistent information compound the problem.
The discussion opened with a reference to research from the Utah-based Sutherland Institute, which the meeting noted found that 43 percent of statewide current and recent safety-net participants had at some point turned down work or extra hours out of concern about triggering a benefits cliff. Panelists said that in many cases the loss of benefits can be greater than, or close to, any additional take-home pay.
Speakers also described limits in how agencies communicate protections. "There are only a few trained staff within the Social Security offices that are able to implement and understand the protections that are there," Wallfish said, adding that inconsistent explanations from different sources increase recipients' uncertainty.
Another panelist said simplifying program rules and better information flow would help employers and jobseekers. "Anything that's simpler makes it easier to make decisions," the panelist said. The speaker described instances in which employees who disclosed benefit status were later not hired or were released, and said complexity deters both disclosure and hiring.
Panelists urged that demystifying benefits and clarifying protections should be a bipartisan effort so employers can more confidently offer opportunities and workers can advance without risking larger losses in total household resources.
The panel did not record any formal votes or policy actions during the discussion. Participants called for further study and clearer communication among benefit administrators, employers and advocates to reduce the cliff's disincentive effects.
