Jobs

Report: Bloated Social Security Disability Program Drains Economy

Accounts for as much as a quarter of declining labor participation

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The rise in workers in the Social Security disability program threatens to cost the economy billions in lost wages and reduced taxes, a report states.

Signs of the problem surfaced Friday in a jobs report that showed U.S. labor force participation rates falling in March to the lowest level since 1979, combined with an unexpectedly large number of workers who entered the disability program during the recession and its aftermath, The Wall Street Journal reported Monday.

The flight of workers, since the recession, to the Social Security Disability Insurance program accounts for as much as a quarter of the drop in participation rates, Michael Feroli, J.P. Morgan's chief U.S. economist estimates.