How Do Macro-Level Contexts and Policies Affect the Employment Chances of Chronically Ill and Disabled People? Part II: The Impact of Active and Passive Labor Market Policies

Abstract

The authors investigate three hypotheses on the influence of labor market deregulation, decommodification, and investment in active labor market policies on the employment of chronically ill and disabled people. The study explores the interaction between employment, chronic illness, and educational level for men and women in Canada, Denmark, Norway, Sweden, and the United Kingdom, countries with advanced social welfare systems and universal health care but with varying types of active and passive labor market policies. People with chronic illness were found to fare better in employment terms in the Nordic countries than in Canada or the United Kingdom. Their employment chances also varied by educational level and country. The employment impact of having both chronic illness and low education was not just additive but synergistic. This amplification was strongest for British men and women, Norwegian men, and Danish women. Hypotheses on the disincentive effects of tighter employment regulation or more generous welfare benefits were not supported. The hypothesis that greater investments in active labor market policies may improve the employment of chronically ill people was partially supported. Attention must be paid to the differential impact of macro-level policies on the labor market participation of chronically ill and disabled people with low education, a group facing multiple barriers to gaining employment.

Employment and income among first-time cases diagnosed with non-affective psychosis in Stockholm, Sweden: a follow-up study 2004/2005–2010

“…Previous studies suggest that the Swedish active labour market policies and employment protection policies seem to result in better employment possibilities for persons with longstanding illness than in other liberal welfare states [20,21]. Still, in our study, persons with non-affective psychosis face a hard situation with poor chances of employment.…”

“…Other consequences following the disease are loss of income and increased costs for personal care and treatment [17], causing stress and anxiety [18], which may impair recovery [19]. The Swedish welfare system is designed to ameliorate adverse social and economic consequences of disease among those who cannot earn their living through work, and has been considered comprehensive and generous in comparison with other countries [20,21]. Active labour market policies to include persons with a chronic illness in the labour market have been a hallmark of Swedish policies.…”

“…This has resulted in higher employment rates among those with a chronic illness in Sweden compared to corresponding groups in countries with passive policies, e.g. Canada and the United Kingdom [21]. Persons who are not able to work because of disease may get sickness benefit, or if the condition is permanent, a disability pension [22].…”

Delayed and differential effects of the economic crisis in Sweden in the 1990s on health-related exclusion from the labour market: A health equity assessment

“…The female labour force participation rate peaked at the end of the 1980s but is still very high in Sweden by international standards. Despite the crisis, employment rates among people with LLSI also remained high compared to levels in other countries (Holland et al 2011a;2011b). This is a major achievement of the Swedish welfare state and raises the counterfactual question of how much worse the situation might have been for people in a vulnerable position on the labour market without such a strong system to start with.…”

“…Comparing the fate of people with and without LLSI on the labour market, we found evidence of differential employment consequences by social class, but that these inequalities were smaller in the Nordic countries than in Britain and Canada, due to differences in active labour market policies as well as the wider labour market policy context (Holland et al 2011a and2011b).…”