A person stands atop a cliff

The Earnings Cliff

LivAbility Magazine

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A person stands atop a cliff

The Earnings Cliff :
Working and Receiving SSDI Benefits

by Susan Webb, VP of Employment Services, Ability360
Many people receiving Social Security Disability Insurance (SSDI) recover enough to return to work. If they do, they can work 12 months above a certain amount of earned wages without affecting their SSDI benefits. After 12 months, however, SSDI cash benefits stop. This is called the “earnings cliff”. But what happens if you reach the 13th month and it takes longer than that to earn enough to make working more feasible?

Meet Andrew. He is 42 years old and receives SSDI benefits of $1,158 per month or $13,896 per year. Andrew has a learning disability, such that he is limited in the kind of work he can do. However, he worked as a courtesy clerk in a supermarket for 14 years and worked himself up to a wage rate of $13.20 an hour or $27,465 per year, twice the amount he currently receives in benefits. But Andrew developed a secondary disability that took him out of the workforce for three years. Now he is ready to go back to the same job, but has to start over at $8.20 an hour or $13,193 after taxes. Andrew is capable of full-time work, but if he works full time, his income will actually be less than not working at all!

Meet Robert. He is 49 years old and has a bachelor’s degree in Computer Science but has not worked since 2002. His SSDI benefit is $1,930 per month. With his education being so out of date, Robert will start a 6-month course in January, 2016, in web development to make himself marketable in today’s workforce. Starting salary in Arizona for a newly-trained web developer is $31,540 or $2,033 per month after taxes, barely more than his current benefits. It will take Robert years to increase his salary enough to make work pay rather than not working at all.

These are current stories, and these are real people. At ability360 Employment Services, we hear these stories every day. These are not isolated occurrences. Some people do manage to go back to work at a high enough level that their income is substantially more than benefits, and their quality of life improves dramatically. Some people work at not much more than benefits because they just want to work and believe it is their obligation to do so. Others limit the hours they work or the salaries they make so they can keep benefits and work too, albeit at a much lower rate than they are capable of achieving – we call this “parking” on benefits.

This rule has been in place for decades although the workplace has changed dramatically from an agrarian/manufacturing economy to a knowledge worker/service economy. In decades past, a family could live quite well on a salary from a job, even without a high school diploma. But times have changed, and the SSDI rules have not kept up. One year is simply not enough to make work more attractive than not working, especially starting over at an entry-level job.


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The Social Security Trust Fund that we all pay into and that pays SSDI benefits is due to go broke in 2016, prompting Congress to explore major changes and updates to the system. On November 2, 2015, President Obama signed the “Bipartisan Budget Act of 2015.” SSDI reforms were tacked onto the “Act” that moved money from the retirement fund into the disability fund to keep it solvent until 2022 while more reforms are explored. One provision of the “Act” mandates the Social Security Administration (SSA) to test a benefits offset that reduces benefits $1 for every $2 earned. Will such an offset encourage more people like Andrew and Robert to work? Such a policy would allow beneficiaries to work as much or as little as they can and still always be better off working. The project to test the offset needs to be designed and rolled out quickly. The “Act” makes it voluntary for any beneficiary to participate. We will keep you posted in LivAbility as things unfold.

If you have questions or comments, please e-mail Susan Webb at susanw@ability360.org


Susan Webb
VP of Employment Services, Ability360

Susan Webb currently serves as Vice President of Ability360 Employment Services. Webb also served as Ability360’s Executive Director from 1991 – 2000.

Webb has served more than 30 years as a local, state and national disability public policy advocate. In 1988, she was appointed by President Reagan to the U.S. Access Board, where she chaired the task force that developed the first ADA Accessibility Guidelines mandated and incorporated into the Americans with Disabilities Act. Later, she recognized that even with the ADA, people with disabilities still remained unemployed or underemployed because of Social Security Disability program disincentives. As a Board Member of the National Council on Independent Living (NCIL) and Chair of its Social Security Subcommittee, Susan advocated for the passage of the Ticket to Work and Work Incentives Improvement Act (TWWIIA), which President Bill Clinton signed into law December 18, 1999. TWWIIA offers opportunities and incentives to remove barriers to successful employment and reduces reliance upon government entitlements for thirteen million Americans currently stuck in “the system”. Webb was one of 12 citizens appointed by President Clinton and Congress to the Ticket to Work and Work Incentives Advisory Panel in 2000. At that time, Webb vacated her post as Executive Director to launch an Ability360 department focused specifically on implementing the Ticket to Work in Arizona.

Webb earned a Bachelor of Science degree in Industrial and Organizational Psychology from Wayne State University, Detroit, Michigan, earned a Master of Business Administration from the University of Phoenix, and a Juris Doctorate from Concord Law School, Los Angeles, CA. She is also certified as a Senior Professional in Human Resources (SPHR) by the Society of Human Resource Management.