The Role of Education in The Disability Employment Gap

There is a gap between the employment rates of disabled and non-disabled people in the UK, which stood at 33 percentage points in 2019. This Disability Employment Gap (DEG) is a cause for concern in government and among anyone worried about poverty and disadvantage. We aim to better understand the DEG by decomposing it into its constituent parts and constructing counterfactual scenarios to demonstrate how it would change if inequalities in education were eliminated or structural barriers to employment were removed. Our results show that if the average education levels of disabled people could be raised to those of non- disabled people, without changing other characteristics or structural barriers in the labour market, then the DEG could be reduced by just 4pp (12%). However, if structural barriers could be eliminated such that a disabled person with a given level of education has the same probability of employment as a non-disabled person with the same level of education, then the DEG could be reduced by over 28pp (85%), a quarter of which would be achieved through eliminating barriers faced by people with no formal qualifications. These findings challenge the notion that tackling supply side issues alone would substantially reduce the DEG and highlight the continued relevance of barriers in the labour market that are disproportionately hindering the employment prospects of disabled people.