Dr Matthew Thomas, Social Policy and
Penny Vandenbroek, Statistics and Mapping
Key issues
Australia is lagging behind most other OECD (Organisation for Economic Co-operation and Development) countries in terms of employment of people with disability.
The Disability Employment Services program, which assists people with disability to find and retain employment, is due to end in 2023, and the Department of Social Services is currently working on a replacement model.
People with disability
The United Nations Convention
on the Rights of Persons with Disabilities defines people
with disability as including those having ‘long-term physical, mental,
intellectual or sensory impairments’ which may act as a barrier to a person’s
full, effective and equal participation in society. The convention outlines the
ways in which the principles of full involvement can be achieved, including
through inclusive communication, universal design, reasonable accommodation and
by alleviating discrimination. Australia formally ratified
this convention on 17 July 2008. Addressing this
commitment from the domain of labour force participation, this article explores the employment outcomes for working age
(15 to 64 years) people with disability.
How are rates of disability
measured?
The Australian Bureau of
Statistics (ABS) measures disability based on a suite of extensive survey questions.
Participants are asked whether they have any conditions that have lasted, or
are expected to last, 6 months or longer. Whether these conditions limit,
restrict or impair the person’s involvement in a range of everyday activities
(for example, using public transport, communicating or walking 200 metres) is
used to assess core activity disability- from mild to severe. People with disability
are also assessed as to whether they have a schooling or employment restriction,
or some other non-specified impairment.
The term ‘disability’ is
used here to capture a range of impairments, activity
limitations and participation restrictions. Reported disabilities from key ABS surveys,
such as Disability,
ageing and carers, can be broadly
categorised as: sensory (hearing, vision, speech); intellectual; physical; psychosocial
(mental illness, memory problems, social or behavioural difficulties); head
injury, stroke or acquired brain injury; or other (a long-term condition that
requires medication or treatment and restricts daily activities).
In 2018,
Australians with disability constituted 13% of the working age population. This
estimate was about 18% when extended to the total population. From 65 years
onwards, the prevalence of disability increases; however, this is also a time
when the level of employment decreases considerably and people may become eligible for the Age Pension.
Labour force status
The labour force consists of the
employed (paid work of one hour or more per week) and the unemployed (not in
paid work, actively seeking work and available to work). The participation rate
expresses the labour force as a proportion of the relevant population, in this
case working age. In
2018, the participation rates for people with disability
ranged from 27% for people with profound or severe disability to 59% for people
with mild disability. In contrast, people with no disability had a participation
rate of 84%. Figure 1 helps to illustrate that people with any level of disability
are less likely to be in the labour force than those without.
Figure 1 People (15 to 64 years) by level of
disability and labour force status, 2018
Source:
ABS, Disability, Ageing and Carers, Australia, 2018 (Canberra: ABS, 2019), Table
8.1; Parliamentary Library calculations.
Employment
The rates of employment among
people with disability vary based on their level of disability. In 2018, just over 2-in-10 people with profound or severe disability
were employed. While the employment rate was higher for people with moderate disability
(4-in-10 people), or mild disability (5-in-10 people), all of these rates were
lower than for people with no disability (8-in-10 people). In most
circumstances, people with disability are more likely to be employed part-time
than full-time.
Just
under half (48%) of people with any disability were employed in 2018, with variation in employment rates by type of
disability. The ABS organises types of disabilities into 5 broad groups:
- sensory and speech
- intellectual
- physical restriction
- psychosocial
- head injury, stroke or acquired brain
injury.
Within each of these groups
there may be a range of disabilities and employment outcomes. For example, 35%
of people with sensory and speech disability work full-time and 16% work
part-time (about 50% are employed). Employment rates within this group are
lowest for people with loss of speech (26%) and highest for people with loss of
hearing (59%), while rates for those with loss of sight are in between (43%).
People with physical
disabilities had the second highest employment rates (at 44%) of the broad
disability groups. However, within this group there was variation in the rates
by disability type, from 23% of people with breathing difficulties to 45% of
people with disfigurement or deformity. People with intellectual disability and
those with a head injury, stroke or acquired brain injury had comparable
employment outcomes, with less than a third of each group being employed (32%
and 29% respectively).
Of the 5 broad groups,
people with psychosocial disability were least likely to be employed, with only
a quarter (26%) in employment. People with mental illness had the lowest
employment rate (13%), followed by people with social or behavioural
difficulties (16%) and those with memory problems (17%). Of this disability
group, people with a nervous or emotional condition were most likely to be
employed (26%).
International employment rate comparisons
In 2017, Australia’s
employment rate gap between people with and without disability ranked 20th in the OECD (exhibit 2, p. 21). This was a slight improvement
from 2010 when Australia ranked 21st in the OECD (p. 40). Figure 2 provides the ratio of Australian
employment rates by disability status. The ratio is calculated by dividing the
rate for people with any disability by the rate for people with no disability.
Figure 2 Employment rates of people by
disability status (left axis) and ratio of employment rates (right axis), 1998
to 2018
(a) People
who reported any type of disability, includes those with a non-specified
restriction or limitation.
Source: ABS, Disability, Ageing and Carers, Australia, various
years (Canberra: ABS, various);
Parliamentary Library calculations.
Disability employment
services
In Australia, the federal
government is responsible for providing employment services and income support for
people with disability. The employment services may be broadly divided into 2 main
categories:
- open employment services that provide
assistance to people with disability in gaining and/or retaining paid
employment in the open labour market
- supported employment services that provide
support to, and employment for, people with disability within the same
organisation.
Open employment services
are provided to people with disability through Australia’s mainstream
employment services program- jobactive- and the specialist Disability Employment Services (DES) program.
When a job seeker
registers for employment assistance, they complete a questionnaire- the Job Seeker Classification Instrument (JSCI). The JSCI is used to establish a job seeker’s
barriers to employment. If the job seeker is found to have a disability, they
may be referred for further assessment (either an Employment Services Assessment or Job Capacity Assessment). These assessments are used to determine a job
seeker’s work capacity in hour bandwidths and whether jobactive services
or DES are more appropriate to support them into employment.
The jobactive program
is administered by the Department of Education, Skills and Employment and the
DES program is managed by the Department of Social Services. Both jobactive
and DES have been privatised and contracted out to non-government for-profit
and not-for-profit providers.
The DES program
Two types of employment
support are provided to people with disability under the DES program- the
Disability Management Service (DMS) and the Employment Support Service (ESS). The
DMS is for people with disability who do not require long-term workplace support.
As at February 2022 the DMS covered 44% of the DES caseload. The ESS is for people who have a more severe or
profound disability and who are assessed as requiring continued workplace
support. The ESS covered 56% of the DES caseload in February 2022. DES programs can also involve
rehabilitation, capacity building, training, work experience and other
interventions.
In February 2022,
just over half (55%) of the people in the DMS had a physical disability as
their primary disability. The largest primary disability type in the ESS was people
with psychiatric conditions (42%).
Open employment service providers
In February 2022 there were 106
DES providers delivering services to job seekers across almost 3,800 sites. In March 2022 more than a quarter
(29% or 242,484 job seekers) of the total jobactive caseload had a
disability. Figure 3 depicts people with disability as a proportion of the jobactive
caseload for the past 5 years. The size of the jobactive caseload with
disability was fairly consistent until the onset of the COVID-19 pandemic in
early 2020, when the total jobactive caseload grew dramatically. This overall growth saw the relative proportion of people with
disability decline. However, this dip was only temporary and the proportion of jobactive
participants with disability has since returned to pre-pandemic levels.
Figure 3 People
with disability as a proportion of total jobactive caseload, 2017 to
2022 (a)
(a) Selected quarters, at March and
September of each year.
Source: National Skills Commission (NSC),
‘Jobactive caseload by selected cohorts time series March 2022’, Employment Regions (jobactive) downloads
(Canberra: NSC, 2022); Parliamentary Library calculations.
Supported employment service providers
Supported employment
services are provided through Australian Disability Enterprises (ADE). ADEs
are generally not-for-profit organisations that employ people with severe or
profound disability who cannot sustain employment in the open labour market but
are able to work at least 8 hours a week. Employers are paid to provide
supports in employment from National
Disability Insurance Scheme (NDIS) participants’
plan budgets and employees are paid a reduced (pro rata) wage that is meant to
reflect their productivity and competence in performing their work. Pay rates
are largely determined under the Supported Employment Services Award 2020 and using a range of wage assessment tools.
Around 20,000 people with disability are employed in
ADEs, doing work like packaging,
assembly, production, recycling, plant husbandry, garden maintenance and
landscaping, cleaning, laundry and preparing food. Figure 4 provides the top 5 industries
of employment for people with a profound or severe disability compared with
people who had no disability. People with severe disability had higher levels
of employment in manufacturing, covering several of the activities undertaken in
ADEs. Industries related to food and administrative tasks were ranked sixth and seventh.
Figure 4 Top 5 industries of employment for
people (15 to 64 years) by selected disability, 2018
Source: ABS, Disability, Ageing and Carers, Australia, 2018 (Canberra: ABS, 2019), Table
9.1; Parliamentary Library calculations.
ADEs have recently been the
subject of controversy, with some supported employees complaining in royal commission public hearings about the low rates at which they are paid.
Rates of pay for ADE employees are a longstanding issue.
Recent developments in
open disability employment services
The Department of Social
Services is currently designing a replacement disability employment support
model as the DES program is due to expire on 30 June 2023. The Department’s consultation process included people with disability, employment services providers,
academics, and the wider community. Submissions closed on 1 February 2022.
The DES replacement program
is taking place in the context of broader reforms to Australia’s
publicly-funded employment services system. jobactive is to be replaced
by Workforce Australia from 1 July 2022. This program will see the most job-ready and
digitally literate of job seekers use self-service arrangements, while more
disadvantaged job seekers will receive intensive face-to-face services. Digital
employment services have already been rolled out nationally in response to the
COVID-19 pandemic, and from 1 January 2022, DES-program job seekers have had
the option of accessing employment services and fulfilling their mutual
obligation requirements online.
The Community Development Program, which delivers employment services to job seekers in
remote Australia (primarily Aboriginal and Torres Strait Islander people), is
also to be replaced by a new Remote Engagement Program, to commence in 2023.
Other relevant
developments include the:
Disability Employment
Services program review
A mid-term review of the DES program was conducted by the Boston Consulting Group from May
to August 2020. The review involved analysis of both the efficacy and efficiency
of the program, and the 2018 program reforms. The reforms sought primarily to
improve participant choice and control, expand DES program coverage, and reduce
the incidence of ‘creaming and parking’- practices through which providers boost
their employment outcome payments by selecting job seekers who are more likely
to find and keep work (creaming) and collect administration fees for harder-to-place job seekers but offer them little or no assistance in finding work
(parking). The review was originally scheduled for December 2020 but was brought
forward due to significantly increased program costs that the review argued were
not matched by a commensurate rise in employment outcomes.
In the 2 or so years
following the 2018 reforms, the DES caseload was found to have risen by 46%.
This contributed to program expenditure increasing from around $800 million in
2017–18 to $1.2 billion in 2019–20. The review found that during the same
timeframe there had been a decline in overall employment outcomes (jobs secured
and employment duration), and that the average cost of achieving these outcomes
had increased by around 38%. The review argued the reduction in employment
outcomes could not be attributed to broader labour market conditions.
The review findings have
been contested by some DES providers. For example, the CEO of Disability Employment Australia suggested the review was ‘deeply flawed’ as a result
of having investigated employment services in the middle of the COVID-19
pandemic, when unemployment was at record high levels. Subsequent DES outcome reports indicate that employment outcomes of program
participants have increased following the easing of COVID‑19
restrictions.
The review identified challenges
for the DES program, including limitations in service quality due to providers’
lack of disability expertise, and the complexity of the system rules that
inhibit providers’ ability to be flexible and innovative or tailor their
support to the needs of individual job seekers. The review was also critical of
the lack of integration and clear pathways between the NDIS and the DES
program, ‘despite their common program goals’ (p. 85).
The review proposed several
recommendations and options to improve DES program performance and ‘restore the
sustainability of DES program caseload and expenditure’ (p. 6). These include:
- better targeting program support to job
seekers who need it the most and who are most likely to benefit from work
- realigning provider incentives to
prioritise employment (rather than education) outcomes
- improving program management ‘with informed
decision making and oversight’
- enabling providers to more easily enter and
exit the market
- enabling and encouraging providers to
exercise flexibility and innovation in the delivery of services
- increasing the amount of time providers are
able to spend assisting job seekers by optimising compliance and administrative
requirements
- allaying employer concerns about employing
people with disability and better assisting them to do so (pp. 7–9).
Consultation on a new disability employment
services model
Over a hundred submissions
were made in response to the department’s consultation paper on a new disability employment support model. While there was
substantial diversity in the responses, there were also some areas of general
agreement.
Some DES service providers
took issue with the findings of the DES review, arguing that the program is
largely effective and should be improved through incremental, evidence-based
reform. However, most submissions maintained that the program is not fit for
purpose and needs to be redesigned. Many submissions expressed concern that the
reform process was being rushed and suggested the current DES contract should
be extended by at least 12 months.
Broadly speaking,
submissions agreed that access to specialist disability employment services
should be made available to all people with disability, irrespective of whether
they are in receipt of government-provided income support. Many expressed
reservations that job seekers assessed as having a greater capacity to work will
be diverted towards Workforce Australia and self-service. There was also a
consensus that a new DES model should be a person-centred model with a
strengths-based approach.
Many submissions argued
that the new model should move away from a ‘work first’ approach towards one
that concentrates on realising long-term sustainable outcomes for job seekers
with disability. Such an approach could reward innovative models of assistance
that are more effective for people with disability. Suggestions included
customised employment, through which jobs are tailored to fit the skills,
interests, strengths, and support needs of a person with disability, while also
meeting business needs.
Several submissions argued
more emphasis on demand-side employment of people with disability is required.
It was suggested that governments could serve as role models- employing more
people with disability themselves, as well as funding research, projects and
innovative initiatives to improve attitudes towards people with disability. Increased
government engagement with employers to develop their confidence and capacity
to employ people with disability was also advocated.
While the NDIS and JobAccess can provide a wide
range of supports to move people with disability into employment, access to
these programs is limited. Submissions argued that greater knowledge of, and
access to, such employment supports could help both job seekers and employers.
Similarly, closer alignment between the new model and the NDIS could help job
seekers to gain and maintain employment.
Many submissions argued mutual
obligation requirements are counterproductive, serving as a barrier for job
seekers to gain employment; and punitive, given the lack of available jobs, especially
for people with disability. If mutual obligations are to be retained in the new
model, these submissions recommended that the compliance function (monitoring
adherence to these requirements) be shifted from employment service providers
to Services Australia or some other third party. Submissions argued that this
shift could improve relationships between job seekers and providers and
potentially lead to better outcomes.
Concluding comments
While well-designed and
well-funded employment programs can and do help job seekers to gain employment,
economic conditions are arguably a more significant determinant of employment
outcomes.
Disadvantaged job seekers,
including people with disability, are disproportionately affected by economic
downturns, such as the recent recession triggered by the COVID-19 pandemic.
If job seekers with
disability are to benefit from the current economic recovery, submissions to
the consultation on a new disability employment services model suggest that
this will require a strong focus on demand-side strategies and working with
employers to identify and create employment opportunities.
Further reading
Australian Human Rights Commission, Willing to Work, report of the National inquiry into employment discrimination against older Australians and Australians with disability, (Sydney: Australian Human Rights Commission, 2016).
Alexandra Devine et al., ‘Australia’s Disability Employment Services Program: Participant Perspectives on Factors Influencing Access to Work’, International Journal of Environmental Research and Public Health 18, no. 21 (31 October 2021).
Katharina Vornholt et al., ‘Disability and Employment- Overview and Highlights’, European Journal of Work and Organizational Psychology 27, no. 1 (2018): 40–55.
Karen Soldatic, Dina Bowman, Maria Mupanemunda and Patrick McGee, Dead Ends: How Our Social Security System is Failing People with Partial Capacity to Work, (Fitzroy, Victoria: Brotherhood of St Laurence, 2021).
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