Severity of Work Disability and Work*

Abstract

A dynamic labour force participation model is used to capture the effect of severity of disability on labour force participation using a sample of working age Australians drawn from the Household, Income and Labour Dynamics in Australia survey. The role of work limitation is shown to be significantly dissimilar across gender, age and severity groups. The simulated impact of limitations is most dramatic for low-skilled women. The new work requirements imposed on Disability Support Pension recipients are shown to be highly effective for this group.