The Disability Advantage

Even as the number of workers with disabilities grows because of factors like the Iraq war, fewer of them are finding jobs. Here's one employer that bucks the trend.

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On a recent morning, Connie Presnell pulled into the parking lot of Habitat International, a carpet, turf, and contract manufacturing company in Chattanooga. She drove past towering lawn ornaments (one's a metal giraffe), and then parked near the building, where she manages the factory floor. As the company's 30 employees punched in, Presnell received word that Habitat had to ship 13,000 boxes to a Tropicana cannery overnight. She assigned a dozen of her fastest workers to the task and, as the sound system cranked up rock music, they got down to work. As usual, the order was delivered on time.

What makes this story remarkable is that Presnell's A-team was made up entirely of people with cerebral palsy, Down syndrome, schizophrenia, and other disabilities. At Habitat, in fact, nearly every employee (including some managers) has a physical or mental disability or both. And yet, Habitat excels by many measures. Its quality-control statistics are especially enviable. During peak season, from January to June, the factory turns out up to 15,000 rugs a day, five or six days a week. Yet the plant's defect rate is less than one-half of 1%. Only about 10 rugs have been cut incorrectly in the company's history. "We've never had a back order," boasts David Morris, Habitat's owner and CEO. "If we fall behind one day, we'll all work hard to catch up."

Morris credits his workers--who are paid regionally competitive wages for factory work--with the company's impressive financial performance. Profits have risen every year for the past decade, against a steady $14 million in sales. And to think, Morris says, shaking his head, that at first, giving these workers a chance "had to be forced down my throat."

More Disabled, But Fewer Are Employed

It's been 15 years since the first President Bush signed into law the Americans With Disabilities Act, which prohibits discrimination against people with disabilities in all parts of society, including the workplace. Nearly 50 million Americans--a segment of the population larger than the number of either Hispanics or African Americans--are covered by the ADA.

But while the ADA improved the treatment of people with disabilities in many tangible ways--think curb cuts and wheelchair ramps--its legacy with respect to employment has been mixed. In fact, since the ADA went into effect, employment among people with disabilities has declined. Between 1990 and 2004, employment rates dropped by 30% for people with disabilities, according to research conducted by Andrew J. Houtenville, a researcher at Cornell University (see chart). "And this in a time frame when employment rates for other people increased," notes Pamela Loprest, of the Urban Institute.

Economists and policy experts argue over why this is so. Some think specific language in the ADA scares employers, others contend that Social Security's disability insurance program compels people not to work. Whatever the cause, one thing is clear: People with disabilities constitute a growing share of the available work force--their ranks swelling because of medical advancements, the aging population, and importantly, the war in Iraq. More than 15,000 troops are likely to be wounded this year, and the rate of amputation, in part because of the prevalence of roadside bombings, is twice that of any previous war. Meanwhile, Social Security and Medicaid are in the midst of reforms aimed at encouraging employment among people with disabilities, says Houtenville. One proposal would move people into training programs more quickly following an injury. Another would allow people to keep federally funded benefits while they get back on the job, he says. But who will hire these workers?

Managers' Concerns, Real and Imagined

Managers who employ people with disabilities often say that many of the perceived concerns are exaggerated. Hidden costs are rare, for example. Researchers at Rutgers University found that 73% of companies employing people with disabilities spent nothing on accommodations, while those that did spent $500 on average. What's more, federal and state tax credits are available to defray the costs. Fears that disabled workers are injury-prone also seem to be overblown.

Still, managing workers with disabilities does require sensitivity and stamina. At Habitat, workers have had seizures on the factory floor. Every couple of weeks, an employee loses bowel or bladder control. To cope, Morris installed showers in the factory. Employees clock out, clean up, and change into a fresh set of clothes that they keep on hand. Then there are workers who have chronic behavioral issues. "I have one employee who has temper tantrums a couple of times a week," says Presnell. "He hits himself, and jumps up and down and screams."

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