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ILO Employment Sector Working Paper No. 43, "The price of exclusion: The economic consequences of excluding people with disabilities from the world of work

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A crossroads has been reached internationally in terms of the status of people with disabilities in society. Countries worldwide are reviewing laws, policies, programmes and services for people with disabilities with a view to promoting their inclusion in all sectors of society and enhancing opportunities for them to earn a decent living, to contribute to the income of their families, or to make a contribution in the workplace. In parallel, there is a growing recognition that the exclusion of people with disabilities from the labour market has been at great cost to societies. To contribute to the information base used by decision-makers in allocating resources to programmes relating to the employability and employment of people with disabilities, the ILO commissioned an exploratory study of the macro–economic costs of excluding people with disabilities from the world of work. Building on previous research, this study developed a new approach that takes two drivers of economic losses into account: the gap between the potential and the actual productivity of people with disabilities; and thedifference between unemployment and inactivity rates of non-disabled people and people with disabilities. Together, these drivers yield the costs that society has to bear for excluding people with disabilities from the world of work. The approach was tested using data from a selection of ten countries in Asia (China, Thailand, and Viet Nam) and Africa (Ethiopia, Malawi, Namibia, South Africa, Tanzania, Zambia, and Zimbabwe). The overall losses and the relative importance of factors underlying these losses – disabling environment, unemployment and inactivity – are estimated for each country. The studyshows that by combining reasonable assumptions and adequate modeling, it is possible to generate data on the costs of exclusion, even for countries where reliable primary data are generally scarce, and suggests that these data are more robust than those generated by a global extrapolation approach.It is hoped that the exploratory study will be useful to governments in settingpriorities and in ensuring that people with disabilities are included in measures to tackle the effects of the global financial and economic crisis. It will hopefully stimulate debate and further research on the inclusion of people with disabilities from an economic viewpoint. Comments on the pilot study and its findings will be welcomed. Sebastian Buckup was the author of this working paper. The research, carried out with financial support from the ILO/Irish Aid Partnership Programme, was guided by Barbara Murray, Senior Specialist on Disability, and comments were received from Sara Elder, Economist, Employment Trends Unit, Ferdinand Lepper, formerly of the ILO Department of Statistics, and Debra Perry, Senior Disability Specialist. Anna Kealy edited the manuscript and Jo-Ann Bakker prepared it for publication.

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2009-01-01

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disabilities; policies; programmes; services; inclusion; sectors; workplace; resources; employability; environment; unemployment; productivity; case studies

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