In 2009, the number of applications for disability insurance surpassed the three million mark for the first time in the history of the program. This reflects an increase of twenty-seven percent across the country. Officials claim one of the reasons for the surge in applications is a shaky economy.
Many companies have begun downsizing in an effort to stay afloat during the economic downturn. Also as a result of that downturn, no new jobs are being created. Not only have the newly unemployed workers lost whichever benefits they had through their jobs, they are flooding an already saturated job market. A recent study reported just yesterday found that there are currently five people for every one job opening in the country. The current unemployment rate of a staggering ten percent lends credence to this estimate.
Lowell Kepke, the deputy communication director of the San Francisco Social Security Department puts it plainly. “The economy has this effect,” said Kepke. “People who have lost their jobs and have a disabling condition may consider their condition the reason they cannot work.”
The Social Security Administration (SSA) says 2009 also saw an increase in the number of retirement benefit applications. The total number of applicants for retirement benefits in 2009 was 2.6 million, which is an increase of eleven percent over 2008’s number of retirement applicants. The unstable economy and poor job market are also reasons for this increase as well. People are taking earlier retirements due to the flailing economy and partly at the suggestions of their employers. Others who had been working with disabilities in recent times have also started applying for benefits instead of remaining in the unstable job market any longer. Another variable in the retirement equation is that baby boomers are now reaching retirement age and applying for benefits.
Right now there are roughly eight million disabled Americans who receive monthly benefits from the SSA. The total dollar amount that the SSA pays each month in benefits is about $8 million. The average disability allowance per person is $1,064. The SSA also pays retirement benefits from the same trust from which disability payments are issued. In comparison, there are approximately thirty three million retired Americans receiving a total of around $40 million each month. The average monthly retirement benefit through the SSA is $1,167. Some applicants are both retired and disabled, which allows them to collect both kinds of benefits. In situations such as this, one of the benefit allowances is usually reduced.
People should not assume that the disability rolls are going to grow with this influx of new applicants. Qualifying for disability benefits is a tedious process. The SSA states that only thirty seven percent of applicants are approved for disability benefits on their first application. Those who do not qualify at first must file an appeal, which can take years to process. Although a lot of applicants choose not to bother filing the appeal, over fifty percent of those who do file the appeal are approved.