The disability employment gap in European countries: What is the role of labour market policy?

Abstract

Across Europe, the labour market participation of persons with disabilities remains lower than that of persons without a disability. Our research examines this disability employment gap, looking specifically at its variation by country and gender. Additionally, we test the influence of labour market policies – testing both the social investment perspective and the welfare scepticism perspective – on the size of the gap, in an effort to determine whether a more generous welfare state raises or lowers the employment rate of people with disabilities. Using the European Union Statistics on Income and Living Conditions (EU-SILC), we show that Southern European countries have the smallest disability employment gap. Whereas stricter employment protection legislation is found to be beneficial for people with disabilities on the labour market, other labour market policies specifically intended to benefit this group do not strongly affect their chances on the labour market. These findings support the social investment perspective and show that social policies can have a positive effect on the employment of people with disabilities.