The geography of the disability employment gap: Exploring spatial variation in the relative employment rates of disabled people

The UK is one of the most spatially unequal countries in the developed world, and there is a long recognised need to ‘level up’ the economy. A strong case can be made to suggest that disabled people are particularly disadvantaged when living in a ‘left behind’ area and hence have the most to gain from levelling up. The disability employment gap, that is the difference between the employment rates of non-disabled people and disabled people, was 31 percentage points (pp) in Great Britain as a whole between 2014 and 2019 but ranged from 17pp to 43pp at local (ITL3) level. Using novel decomposition techniques we find that the key drivers of this spatial variation, each explaining similar shares, are local population characteristics and economic structure, including the level and nature of labour demand in geographical areas and the industry composition of the area. However, spatial variation in healthcare capacity, social capital, employer policies towards disability and the stringency of statutory welfare provision do not appear to have an effect on the gap. Our results suggest that locally adapted policies to narrow the gap may be more effective than a one-size-fits-all approach.