Vocational rehabilitation observed to have no effect among low-income applicants of a disability pension
The impact of vocational rehabilitation could not be shown in the study which utilized preliminary decisions for vocational rehabilitation. Getting a preliminary decision did not have a clear impact on employment or earned income.
Since 2015, Finnish disability pension applicants who are rejected or receive a short-term temporary pension have also received a preliminary decision for vocational rehabilitation if they are eligible for vocational rehabilitation arranged by earnings-related pension providers.
A key requirement for eligibility is that the person must have received a certain amount of income insured under an earnings-related pension act during the previous five year. In 2022, the income limit is around 37,700 euros.
In this study, we examined how employment, unemployment and income developed for persons whose earnings were close to the threshold providing eligibility for the preliminary decision. The impact was evaluated two years after the applicants received their preliminary decision.
“Among those who exceeded the income limit, employment was slightly higher, unemployment slightly rarer and income higher than among those below the limit, but the differences were non-significant. Thus receiving a preliminary decision for vocational rehabilitation could not be shown to make a clear impact”, says Senior Researcher Mikko Laaksonen (Finnish Centre for Pensions).
Study shows no evidence of the general effectiveness of vocational rehabilitation
Based on this study, it is not possible to draw conclusions on the general effectiveness of vocational rehabilitation, given the narrow and specific study population.
“Vocational rehabilitation may be more efficient among those who sought rehabilitation on their own compared to those who received a preliminary decision in connection with their pension decision. Among all receiving a preliminary decision, the study population is also low-income and weakly attached to work”, Laaksonen explains.
Read the research article
Laaksonen M, Ilmakunnas I, Tuominen S. The impact of vocational rehabilitation on employment outcomes: A regression discontinuity approach. Scandinavian Journal of Work, Environment & Health 2022; 48(6): 498-506.
