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Workers With Disabilities in Large and Small Firms: Profiles from the SIPP

Written by:
Working Paper Number SEHSD-WP1990-13 or SIPP-WP-127

Introduction

Research on disability management has paid relatively little attention to the special problems posed by the financial and management constraints of smaller companies. The oversight is an important one, as businesses with under 100 workers employ over a third of the American labor force, and those with less than 500 account for fully half of all employment. Anecdotal and survey evidence suggest that small firms are less likely to make work accommodations, to have formal disability management programs or hiring policies for disabled job candidates, or to retain employees after a disabling sickness or injury. The typical small company faces formidable barriers in dealing with disability. These constraints include limited economies of scale and a lack of specialized personnel or benefits staff to take charge of making work accommodations, limited training facilities and opportunities for shifting disabled employees to alternative jobs within the company, fewer provisions for medical and disability benefits, and weaker financial incentives for controlling disability-related costs.

On the other hand, small businesses remain an important source of work and training opportunities for disabled people. Research on the general labor force has consistently shown that small firms are more likely to hire job candidates considered "high risk" by larger employers, including youth, new labor force entrants, and the long-term unemployed. As we will see, this tendency applies to disabled job-seekers as well. Though they provide less formal or job-specific training, small firms do provide a springboard of general training and experience which enables their employees to compete for jobs with better pay and benefits elsewhere.

Even in the area of disability management, small businesses have two important--though often underrated--advantages over large companies. One is the degree of flexibility and informality that is possible in a small-scale operation: there are greater opportunities for flexible or reduced work hours, job sharing, or the redefinition of jobs to accommodate a disabled employee. These informal "common-sensical" practices are not always recognized as accommodations by the employer, and may be far more common than we realize. A second advantage is that the relatively short chains of command in most small firms make it possible for employees with disability problems to discuss their needs directly with those making the ultimate decisions in the company. Once the firm's decision makers are convinced of the value of an intervention, there are fewer organizational barriers to quick, decisive action.

The need to address the special problems of disabled people in smaller firms has drawn attention to the lack of good statistical background information on this population. The need for such information will grow after implementation of the Americans with Disabilities Act, which will require job accommodations by companies with as few as 15 employees. But apart from anecdotal evidence, very little is known about differences in labor force characteristics or job conditions for workers with disabilities in large and small firms.

Page Last Revised - October 8, 2021
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