Labor Gaps as Opportunities: How Workforce Shortages Can Impact Employment for People with Disabilities
The pandemic accelerated technological advances and demographic shifts in society, significantly impacting the employment landscape. Changes in the style and structure of work, including remote work—combined with the renewed worker focus on personal priorities—have created challenges and opportunities for many industries seeking to fill open positions.
The resulting labor shortages present opportunities for people with disabilities seeking employment. Both public sector and state-based, private sector incentives for employers who want to hire workers with disabilities can increase employment opportunities for disabled individuals.
Workers With Disabilities Can Fill Public Sector Job Vacancies
State government is one of many sectors struggling with labor shortages. To address this issue, state and local policymakers have pursued creative strategies to recruit, promote, hire and retain state government employees, including those from historically underemployed groups.
One approach seeks to increase the participation of people with disabilities in the labor force, often through the adoption of State as a Model Employer policies. SAME policies are formal initiatives by state governments to promote inclusive employment practices for disabled people.
For example, New York passed legislation mandating state agency website accessibility and allowing employees with disabilities to work part-time in certain state jobs. California mandated that state agencies develop reasonable accommodation policies for workers. Massachusetts operates a Reasonable Accommodation Capital Reserve Account designed to supplement existing agency resources. The Council of State Governments, in collaboration with the State Exchange on Employment & Disability, provides resources on SAME policies enacted across states.
State governments have also reduced barriers for people with disabilities and other historically underrepresented groups by streamlining hiring processes. One strategy involves shifting to skills-based hiring, which assesses a candidate’s relevant experience and expertise rather than their level of education.
As of October 2024, at least a dozen states have removed degree requirements from state employment, and others have taken similar steps. For example, in 2022, Colorado Gov. Jared Polis issued an executive order mandating the state to evaluate whether degree requirements can be removed from positions. In 2023, in an effort to increase the number of applicants for state positions, Arizona enacted legislation mandating reviews of all state roles to determine whether four-year degree requirements could be removed. Virginia Gov. Glenn Youngkin also recently removed degree requirements from most state jobs.
Implementing hiring preferences for historically underrepresented groups in the public sector is another strategy. For example, Virginia in 2022 and West Virginia in 2023 mandated state hiring preferences for underrepresented groups, such as veterans and people with disabilities.
Historically, the apprenticeship model has been associated with trades, but policymakers are increasingly using this strategy to fill public sector roles—or at least make them more accessible to people without formal education.
In 2023, Idaho enacted legislation to remove funding barriers for state agencies hiring apprentices. Virginia enacted legislation in 2022 directing the Board of Workforce Development to draft recommendations to create an office dedicated to apprenticeships. Washington created a committee of state agency human resources managers to develop public sector apprenticeship programs. Ohio’s Vocational Apprentice Program provides apprenticeship opportunities for people with disabilities. This broadening of the apprenticeship model can help historically underrepresented workers, including those with disabilities, access a career in the public sector.
Incentives and Supports Can Benefit Both Employers and Workers in the Private Sector
The private sector has also addressed workforce shortages by embracing talent pools historically underrepresented in the labor force. Several states have enacted legislation in recent years incentivizing employers to hire people with disabilities, including creating and/or increasing tax credits for businesses that do so. Maryland increased the wages eligible for the credit from the first $9,000 earned to the first $15,000 earned. In 2023, North Dakota increased the tax credit offered to employers from 5% to 25% of $6,000 in wages for hiring a person with a developmental disability or severe mental illness.
In addition, states are recognizing that disability etiquette training can create a welcoming and supportive work environment for people with disabilities. For example, all Massachusetts state employees must complete a disability awareness training within one year of employment and Illinois requires all state agencies to send a hiring manager annually to training on hiring people with disabilities.
Some states are creating additional supports for smaller employers. Many small businesses are open to hiring workers with disabilities, but are daunted by the potential cost of providing reasonable accommodations. While a federal tax credit does exist to help offset these costs, states can provide additional funding to incentivize the hiring of people with disabilities. Last year, Minnesota created through legislation the Employer Reasonable Accommodation Fund to reimburse small to midsize employers for costs they incur to provide reasonable accommodations. States can also educate employers on the cost and range of possible reasonable accommodations, since many are low-cost or free, with the Office of Disability Employment Policy’s Job Accommodation Network reporting that many have a one-time cost as low as $300.
This publication was funded by the U.S. Department of Labor’s Office of Disability Employment Policy (DOL/ODEP) through the State Exchange on Employment & Disability. This document, and any other organization’s linked webpages or documents, do not necessarily reflect the views or policies of DOL/ODEP, nor does the mention of trade names, commercial products, or organizations imply endorsement by the U.S. government.