Changing Labor Markets and Mental Illness
Many of the sequelae of mental illness – motivational, affective, and cognitive – translate into impairments in the skills that contribute to labor market productivity. A recent review summarized the evidence on cognitive dysfunction for seven categories of mental illness (Millan et al. 2012) concluding that for many people with mental illness, “cognitive dysfunction is broad-based and seriously affects real-world functioning.” More specifically, this review elucidates the important impacts of mental illness on attention, working memory, executive function, speed of processing information, and social cognition. These deficits combined with some of the motivational (e.g., sense of purpose, goal orientation) and affective features of mental illnesses, limit productivity. The impact on productivity stemming from mental illness is exacerbated by the onset of a number of these illnesses in late adolescence and early adulthood, compromising the accumulation of human capital in the forms of education, training and job experience, leaving people with these diagnoses at a lifelong disadvantage (Breslau et al. 2008). While there is a great deal of heterogeneity in the impacts of mental disorders on various dimensions of productivity, mental illnesses have consistently been shown to create large disease burdens.
For many people with a mental illness, as for most people, work is beneficial (Luciano AE, GR Bond, RE Drake, 2014). For people with severe mental illnesses, work has a therapeutic effect and leads to more social interaction and better general well-being.
The skill impairments associated with mental illness have always made it challenging to integrate people with severe mental illness into the workforce. However, there is good reason to believe that, despite improved treatment, the changing nature of work makes this integration more challenging. The 21st century labor market demands a different set of skills than were needed in the past. Automation of routine tasks has been accelerating; technological improvements in information and communications technology require a workforce that has the capacity to engage in non-routine cognitive-intensive work (Gaggl and Wright 2017) . These technological trends decrease demand for low-wage jobs that require workers who can perform routine cognitive and non-cognitive tasks. This pattern of change in workforce demand may have profound effects on the employment prospects for people with mental illnesses. Specifically, if people with mental illnesses are disproportionately employed in jobs where the demand for the skills that they retain is declining they may be disproportionately disadvantaged by the evolution of U.S. labor markets. This, in turn, raises concerns about both the economic and therapeutic circumstances this sub-population will face in the coming decades.
In this paper, we describe three issues of relevance to the dynamic relationships between mental illness and the changing labor market: What are the trends in labor force participation (LFP) for people with mental illnesses for the years 1997-2017; what are the trends over time in disability application among people with mental illnesses; and does the composition of skills required by jobs held by people with mental illnesses differ from that of the general population? We use data from the National Health Interview Survey (NHIS) for the years 1997-2017 and the Occupational Information Network (O*NET) survey of jobs. We offer some hypotheses about what our findings mean for employment of people with these illnesses in the coming decades.
This research was supported by a grant from the U.S. Social Security Administration (SSA) as part of the Retirement and Disability Research Consortium (RDRC). We are also grateful to the Robert Wood Johnson Foundation for financial support. The findings and conclusions are solely those of the authors and do not represent the views of SSA, any agency of the federal government, or the NBER Retirement and Disability Research Center.