Eschaton: There's Another No Work Option: Laid Off:
Ed Glaeser writes a lot of words dancing around the obvious issue:
I believe that recipients of the [SSDI] aid are typically in pain, but many have a choice between suffering at work and going on disability. In boom times, the work option may seem more attractive, but as labor options contract, a steady check from the federal government can seem the better choice. The recession surely explains much of the 24 percent increase in the number of people receiving Social Security disability insurance since 2007.
It's an economist way to think about things, that someone being in the labor force means they're choosing the "work option." But in recession the options for some are no work and no money (otherwise known as "homelessness") or managing to qualify for disability (average monthly payment about $1100, max benefit about $2500). If you have some form of disability, you might be able to work if you have a job and employer that can accommodate you, but lose that job and you're probably going to be out of luck.
This isn't really mysterious stuff. Someone is 61, has a moderate disability, and loses his/her job. There is no work option.
