Various aspects of inclusion and exclusion for people with disabilities have been analysed in previous studies for the NDA and the Equality Authority, including cross-sectional analysis of available data from representative household surveys (Gannon and Nolan 2004, 2005). On almost all the measures studied, people with chronic illness or disability fared worse than others in their own age group. It is however difficult to tease out from such a "snap-shot" precisely the role played by disability itself, as opposed to other factors - since those affected by disability may also be distinctive in other ways, such as age, education and labour market experience. The Living in Ireland Surveys followed the same people from one year to the next, and so can be used to track individuals not experiencing disability and then subsequently reporting disability, and others who move from reporting disability to not doing so. The change in the outcomes of interest - labour force status, earnings, household income and social participation - as disability status changes can then be studied directly. This improves our capacity to estimate the effects of disability with precision and allows the channels whereby these effects operate to be traced with more confidence.
This study has exploited this potential of the longitudinal data from the Living in Ireland surveys, presenting an investigation of the dynamic relationship between disability and exclusion. Specifically, it has investigated how employment, income and income poverty, and social participation change as onset of or exit from disability is observed in the panel surveys. The position of those reporting disability throughout the life of the panel was also studied, to get a sense of the effects of such persistent disability. The key questions being asked are what we can learn from the experience of these people with differing experiences of disability about how much impact disability itself has on employment, income and poverty, and social participation. As emphasised in previous reports, the measurement of disability in a survey context poses considerable definitional and methodological difficulties, and disability can be captured in only a very crude fashion in a general household survey like the Living in Ireland Survey.
The study relied on data from the Living in Ireland Survey over the period from 1995 to 2001, described in Chapter 2 and in greater detail elsewhere. In that survey, in any year about 20% of the adult population reported having a chronic illness or disability. Tracking individual adults from 1995 to 2001, about twice that many reported such an illness or disability at some point over the seven years. Our interest here has been in three different sub-sets of that total: those for whom we observe the start of a spell of disability over the life of the survey, those for whom we observe the end of such a spell, and those who reported disability in all seven years of the survey. Including in the analysis not only those observed with a disability "transition" during the panel survey but also those persistently disabled meant that the duration of disability, which might be expected to have a major role in determining its impact, was not neglected.
The impact of disability "onset" was studied by focusing on persons in the survey who reported no chronic illness or disability for two years, followed by two years when they do report illness or disability. The analytical strategy employed was then to compare their situation with those "at risk" of onset who did not actually experience it - in other words, those who reported two consecutive years without disability in the panel and were then observed for a further two years without disability. (Someone who reported disability throughout the panel was not "at risk" in this sense, because the onset of disability could not be observed.) A total of 235 individuals were observed in the panel experiencing disability "onset", defined in that way. Older people were seen to be more likely than others to experience onset, and being in a low-income household was also associated with an increased probability of onset.
We then went on to examine the relationship between disability onset and employment. When observed in a cross-section, about 70% of those not reporting a longstanding/chronic illness or disability and of working age in the Living in Ireland Survey were in employment, compared with 40% for those reporting such a condition. Focusing on those observed to experience onset, only about 60% were employed before that happened - these individuals were already more prone to unemployment and inactivity than others. When disability onset then occurs, the employment rate for these individuals fell from 60% to 46%, and in the year after onset this fell a little more to 43%.
Statistical analysis of these individuals then showed that, having taken a range of personal and household characteristics into account, the onset of disability was associated with a decline of about 20 percentage points in the probability of being active in the labour force. Where the chronic illness or disability did not hamper the person in their daily activities it was seen to reduce the probability of being in employment by about 10 percentage points, whereas when it did hamper them that reduction was closer to 30 percentage points. Those already in low-income households were more likely to move from being active to inactive, as were women and those with low levels of education.
The impact of disability onset on household income and income poverty was also examined. From a cross-sectional perspective, average household income (adjusted to take the needs of larger versus smaller households into account) for individuals in the sample reporting a chronic illness or disability was only about 80% of the corresponding average for those not reporting such an illness or disability. Focusing on those observed to experience onset of disability during the period of the survey showed onset to be associated with a decline in household income. When other individual and household characteristics were included in the statistical model the estimated effect of onset was reduced by about one-third, but was still statistically significant and substantial. Household income in the year of onset was estimated to be about 15% lower than it would have been if the person had not become ill/disabled. For those experiencing onset of a disability that hampers them severely, the predicted impact on income was considerably larger. Household income fell partly because of reduced employment, but also because some of those remaining in employment worked fewer hours.
Turning to relative income poverty, from a cross-sectional perspective 30% of those reporting chronic illness or disability fall below 60% of median household income, a widely-used measure of income poverty, compared with 17% of those not reporting such a disability. Disability onset was then seen to be associated with very substantial increase in the probability of being below that income threshold. Personal and household characteristics of those affected played some role in increasing this risk, but even when they were taken into account disability onset per se increased the "at risk of poverty" rate by 7 percentage points. Much of this increase in poverty risk was attributable to lower employment.
The relationship between social participation and disability onset was also analysed from a dynamic perspective. Cross-sectional figures show those reporting a chronic illness or disability with lower rates of social participation on some indicators than those not reporting such illness or disability, though their levels of participation on average are quite high. When disability onset was observed during the panel survey, however, only one of our four social participation indicators registered a decline. Statistical analysis suggested that only onset of severely hampering disability was associated with a significantly lower level of participation, whereas disability that hampered the individual to some extent or not at all did not have such an association.
The impact of disability "exit" was studied by focusing on persons observed in the panel reporting two consecutive years with a disability followed by two years without such a disability. They were compared with those "at risk" of exit who did not experience it - those reporting disability for two years in a row but not then reporting two disability-free years. The number of cases observed with a disability "exit" defined in this way was 138. Among all those "at risk", persons initially in work were more likely than others to exit disability.
The employment rate of those observed to exit disability in this way rose from about 50% to 58% comparing the year of exit with the previous year. Statistical analysis of these individuals confirmed that exiting disability was associated with an increase of about 7 percentage points in the probability of being in employment, having controlled for personal and household characteristics.
Exit from disability was also found to be associated with an increase in household income. Personal and household characteristics accounted for some of this apparent effect, but when they were taken into account exit itself was still associated with an increase of about 10% in predicted household income. Exit from disability appeared to be associated with some reduction in poverty risk, but when other characteristics were added to the explanatory model, notably the person's education level, that effect was no longer statistically significant. Similarly, the estimated impact of exit on social participation was not statistically significant.
As well as examining what happened on disability onset and exit, we also looked at those reporting persistent illness/disability, that is over all seven years of the panel survey. A total of 180 cases had that experience, accounting for 7% of all respondents and 16% of those who reported disability at any point over the life of the survey. Those experiencing persistent disability were disproportionately older and less well educated than others.
Persistent disability was associated with a greatly reduced likelihood of being in work, with only 13% of these individuals in employment throughout the period of the panel, compared with half of those of working age with no reported disability experience. When a range of other personal and household characteristics was taken into account, such persistent disability was estimated to be associated with a 42 percentage point reduction in the likelihood of being in employment. This represents a very substantial reduction, with all the implications that has both for income and for broader participation in the life of society.
Persistent disability over the life of the panel survey was also strongly linked to lower household income. Even when the personal and household characteristics, including education level, of the individual were taken into account, the predicted household income of someone reporting persistent disability was 20% lower than someone who was otherwise similar but had no experience of disability over the period.
Persistent chronic illness or disability also substantially increased the probability of being below the relative income poverty threshold. When other individual and household characteristics were taken into account, the predicted "at risk of poverty" rate was 13 percentage points higher for someone who experienced persistent disability, compared with those who experienced no disability over the panel period. Once again reduced employment seemed to be the key channel through which disability increased poverty risk.
Finally, having a chronic illness or disability throughout the life of the panel significantly affected the expected level of social participation. After controlling for personal, and household characteristics, the predicted rate of participation (in all four aspects measured) for those reporting disability throughout the panel was 9 percentage points lower than for those with no experience of disability over the period.
The findings of the study, summarised in this chapter, serve to deepen our knowledge and understanding of the impact of disability on key outcomes. They complement the evidence from previous research about the impact of persistent disability on the probability of being in work, on household income and poverty, and on social participation. Furthermore, they quantify the impact of disability onset on that probability, having taken other characteristics of the individual and their household into account. Perhaps the single most important finding is that disability onset and persistent disability, even when everything else we know about the person and their household are taken into account, are each associated with a very substantial reduction in the likelihood of being in work, and primarily through this channel also result in lower household income and a higher risk of poverty. This poses a major challenge for policy in relation to tackling the many-faceted barriers to obtaining and maintaining employment that face people with disabilities, as well as in designing income support policies that provide an adequate standard of living for those relying on that support while also promoting employment.