The high cost of exclusion and what we need to do about it

The global exclusion of persons with disabilities comes at significant economic, political, and societal costs. Decades’ worth of data substantiates this claim, yet progress has remained elusive. Now, due to the disruptions of a global health crisis and recession, it is likely that the situation for persons with disabilities will worsen. But this does not and should not have to be the case.

The guiding principles of the United Nations Convention on the Rights of Persons with Disabilities (CRPD) and Sustainable Development Goals (SDGs) establish a framework for action and aspirational outcomes. Since the establishment of both, we have not seen any shortage of inspiring initiatives, spearheaded by leading disability community organizations and growing interest from different private sector firms.

Indeed, we can go so far as to say that advances in legislation and the adoption of responsive human rights treaties worldwide are the results of normative behavior changes on the topic of inclusion. However, some factors continue to go unaddressed, constraining the innovative potential of individuals and firms, as well as the prosperity of nations. It is with this recognition that the Portulans Institute has established a new project on the topic of global disability inclusion.

 Global Situation

Many studies establish a baseline understanding of the global situation for persons with disabilities. Often cited as the largest minority group, it is estimated that persons with disabilities comprise upwards of 15 percent of the world’s population or nearly 1 billion people.[1] However, what is commonly overlooked is the degree of diversity within the disability community. Persons with disabilities are the only group that represents the full breadth of intersectional identities of human beings. Across the community, we see the intersection of age, cultural background, disability type, economic situation, education level, gender, geographic influence, race, religion, and sexual orientation. But unfortunately, persons with disabilities are commonly thought of as a homogenous, monolithic group. The failure to recognize the diversity of the community, in terms of data collection and the formation of business strategies and public policy, is a critical factor in the global loss of productivity, innovation, and persistent exclusion. This reality is continuously reinforced by reports of global trends in educational attainment, employment, and rates of poverty. At the Portulans Institute, we view these complex issues through three dimensions of cost:

Economic Cost of Exclusion

Source: A Hidden Market: The Purchasing Power of Working-Age Adults With Disabilities Report, 2018.

Estimates suggest that nations forego up to 7 percent of their Gross Domestic Product (GDP) due to the exclusion of persons with disabilities.[2] Contributing factors for this estimate include the interplay between low investment in accessible education, leading to un- and underemployment, which increases the likelihood of poverty and dependence on social welfare programs.[3],[4] Such outcomes are perpetuated when public policies are created that do not consider the unique experience of persons with disabilities. As a result of exclusion, countries are not able to tap into the full potential of their citizens to realize the benefits of their contributions. We see this play out directly at the firm level.

When firms fail to see persons with disabilities as both contributors and consumers, they squander opportunities to expand market share and create economic and social value. The need to establish a “business case” for disability inclusion has continued to be a convenient reason for firms to avoid addressing their recruitment, hiring, and retention strategies. In 2020, this excuse rings hollow. Regarding persons with disabilities as contributors, there is a wealth of information that clearly shows how inclusion makes perfect sense regarding business. Studies find that firms that make inclusion a priority are four times more likely to generate higher shareholder returns within their industries.[5]  A rolling survey conducted in the United States shows that approximately 58 percent of workplace accommodations for persons with disabilities could be made at no cost and the investment for other situations averaged to be just $500. More importantly, for this nominal cost, firms experienced higher levels of retention and productivity, along with greater workforce diversity and morale.[6]

It stands to reason that the inclusion of persons with disabilities as workplace contributors leads to a more significant opportunity to address their potential as consumers. Estimates suggest that persons with disabilities have a combined $1.2T annual disposable income worldwide.[7] Despite this staggering figure, they are often not viewed as a target market for firms beyond niche products and services. Much of the private sector fails to recognize that persons with disabilities represent a major untapped market segment. One report suggests that firms can reach up to four times their target number of consumers if they design products and services that meet the needs of diverse groups.[8] This is especially true for the information and communication technology (ICT) market, with near limitless levels of economic and social benefits yet, they have not been realized despite a noted trend of increased accessibility features for both new products and services.[9]

Most compelling is the opportunity to simultaneously capitalize on the contributor and consumer benefits offered by persons with disabilities. By directly employing persons with disabilities to inform the design of products and services, firms create an environment where individuals are addressing barriers for others with a shared experience. This leads to a virtuous cycle of value creation for all stakeholders. Despite the clear case for inclusion, persons with disabilities still face unemployment levels that average double the rate of their non-disabled peers in developed countries and upwards of 80 percent in other parts of the world.[10]

Political Cost of Exclusion

While the economic cost of exclusion is well documented, the political costs are more nuanced. We view the political costs as the byproduct of policy and regulatory actions that fail to achieve their intended outcomes or create unintended consequences.

It is understood that the adoption of universal design principles can lead to significant cost savings and downstream benefits in the areas of construction and technology development.[11], [12] The same can be said for policymaking. By directly including the disability community in the design of education, employment, social welfare, and technology policies, governments worldwide could avoid the costly duplication of effort related to amendments or standalone legislation that attempt to correct unintended exclusion. This requires a recognition of persons with disabilities as students, taxpayers, and vital contributors to the workforce instead of the general depiction as just beneficiaries of social programs.

From a regulatory standpoint, we see the political costs as the interaction between compulsory action, free will, and unencumbered market activity. When the government seeks to correct a known issue with regulatory frameworks, it can lead to a range of unintended responses. This includes avoidance, increased fear of legal consequences, and underperformance relative to goals. A specific example is the enforcement of employment quotas for public and private sector hiring of persons with disabilities. Rather than address the root cause issues of social identity-based barriers (such as stigma and discrimination), and the consequences of exclusionary policymaking, governments across the world have established employment goals with associated financial penalties. The imposition of penalties for non-compliance can serve to worsen the issue they intend to correct as companies either avoid the issue altogether due to an association between marginalized groups and consequences or engage superficially without a commitment to fostering an inclusive culture. In some cases, firms may find themselves at a loss for where to begin because they lack context about the contributions persons with disabilities can provide to their industries. These outcomes lead to political costs for those who create and enforce regulations, especially when the results fall short of intended targets.

Social Cost of Exclusion 

Societally, the exclusion of persons with disabilities contributes to lost potential for innovation and entrepreneurship, as well as the political aspects of civic engagement and representation. We also see the social cost of exclusion in reinforced stigmas and discrimination, dependency on others, and increased pressure placed on caregivers and public systems, as well as the residual health impacts associated with poverty.[13]

Fundamentally, such issues originate from the social identity of persons with disabilities that are held by others and projected on the community or internalized due to a lifetime of experiencing discrimination. Society fails to place equal value on persons with disabilities and their nondisabled peers. This reality becomes even more complicated when we recognize the diverse intersection of identities with the persons within the community, and the additional barriers associated with age, gender, and race. The undervaluing of persons with disabilities is a root cause for underinvestment in education and workforce development programs that lead to the many problematic outcomes identified throughout this post.

Individuals, firms, and nations can begin to assess their behaviors and act toward positive change by recognizing the role that social identity-based barriers play in excluding persons with disabilities. As a social construct, this can be aided by addressing how persons with disabilities are depicted as either sympathetic, charitable caricatures, as heroes overcoming adversity, or as a population to avoid due to cultural biases. Disability is a part of the human experience that is likely to touch everyone’s life in some way. By continuing to “other” those in the community, we fail to recognize their humanity and exclude them from fully contributing to society, which leads to the detriment of everyone.

Why does this matter to countries’ innovation, talent, and technology readiness?  

There is a common narrative of social inclusion found in the Portulans Institute’s research and flagship programmatic areas. Consistently, we find that nations rise to the top of comparative rankings when they recognize and invest in a diverse and inclusive innovation culture. This comes through education, workforce development, and related economic and social policymaking that acknowledge the potential of all citizens to contribute. Reflecting on the organization’s history of research and analysis, we see a growing recognition of the untapped potential of people with diverse identities and cognitive backgrounds, the importance of inclusive teams, and the resulting impact on the vitality of firms and nations.

Examples of notable trends from past reports include:

  • Year over year, the Global Innovation Index (GII) demonstrates the importance of individuals and teams in catalyzing innovation for firms and nations. The 2014 GII pointed to improvements in the geography of innovations due to the availability and mobility of human capital worldwide. Though not directly addressed, this points to the benefits of increased diversity across geographic borders. The 2015 and 2016 editions of the GII showed clear connections between innovation and the availability of skilled knowledge workers, which were positive outcomes of investment in education and training.
  • The 2018 Global Talent Competitiveness Index (GTCI) is particularly relevant to this discussion, given the theme of Diversity for Competitiveness. Among other points, the report shows how diversity has become increasingly recognized as a resource for innovation. This leads to increased consideration for including demographic groups that have traditionally been sidelined. Though the report primarily cites demographics in terms of gender, culture, and ethnic background, the contents introduce a comparison of cognitive and identity-based diversity, which offer a natural connection to the disability community.[17]
  • The 2019 Network Readiness Index (NRI) sets forth a clear statement that harmony between people and technology is needed to attain the SDGs and increase the quality of life for all. The report also directly confronts the inclusion of persons with disabilities, citing their potential to benefit the development of information and communication technology (ICT) and create a virtuous cycle of economic and social benefit. Among the measurements found in the NRI’s indexing methodology, the role of governance in promoting inclusion to address gender, disability, and socioeconomic status-based inequalities serves as an example of PI’s keen interest in this topic. The 2019 NRI was the first report from PI to directly confront the experience of persons with disabilities and establish a connection to global digital innovation.[18]

Importantly, the identified reports lead to questions about the connection between trends in innovation, talent competitiveness, technological advancements, and persons with disabilities. As a group, persons with disabilities are less likely to experience economic, geographic, and social mobility. As a result, how much opportunity is forgone within industries, nations, and across the world due to this unfulfilled potential? The growing demand for skilled workers, addressed through investment in education and workforce development, is apparent. However, persons with disabilities are not often associated with the label of “skilled” workers due to persistent discrimination.

Actions Toward Progress

Given the trends and evidence presented, there is a need for constant and consistent action toward progress. In response, the Portulans Institute is creating a community of practice of leading disability network representatives and businesses with an affinity for diversity and inclusion as core elements of innovative firms, to outline a framework to address pressing needs for research and data insights. By leveraging its extensive capabilities with global indices and benchmarking studies, Portulans Institute can develop meaningful contributions that can be used across sectors to foster new levels of understanding and provoke action.

Through the community of practice, we aspire to collaborate broadly with leading groups who have created measurement tools such as G3ict, Return on Disability, the Washington Group on Disability Statistics, the World Health Organization, and the Zero Project. We also look forward to engaging business leaders alongside the International Labour Organization, Valuable 500 and World Information Technology and Services Alliance, as well as civil society and policymakers through the Conference of States Parties to the CRPD. Much has been done toward the inclusion of persons with disabilities. But the level of expected progress has remained elusive. The Portulans Institute stands ready to make a positive and impactful contribution toward a shared vision of a fully inclusive global society.

In the coming months, we will identify and engage with leading voices across sectors, coordinate a series of discussions to establish a plan for action, and produce a framework for the Portulans Institute’s work in the area of global disability inclusion.

Interested parties should contact Shane Kanady, Sr. Fellow, at kanady@portulansinstitute.org

 

 

Footnotes 

  1. United Nations Division for Social Policy and Development (no date). Factsheet on Persons with Disabilities.
  2. Ibid.
  3. Kanady, S., Muncie, N., & Missimer, K. (2020). An Inclusive Future of Work: A Systems Approach. SourceAmerica. 
  4. CBM, International Centre for Evidence in Disability, & London School of Hygiene & Tropical Medicine. (2015). The Economic Costs of Exclusion and Gains of Inclusion of People with Disabilities: Evidence from Low and Middle-Income Countries.
  5. Accenture. (2018). Getting to Equal: The Disability Inclusion Advantage.
  6. Job Accommodation Network. (2019). Workplace accommodations: Low cost, high impact. 
  7. Donovan, R. (2016). 2016 Annual Report: The Global Economics of Disability. Return on Disability. 
  8. PwC, Australia. (2019). The Benefit of Designing for Everyone. Centre for Inclusive Design. 
  9. G3ict and Knowbility. (2018). The Impact of Digital Accessibility Innovations on Users’ Experience. 
  10. United Nations Division for Social Policy and Development (no date). Factsheet on Persons with Disabilities. 
  11. Wentz, B., Jaeger, P.T., & Lazar, J. (2011). Retrofitting accessibility: The legal inequality of after-the-fact online access for persons with disabilities in the United States. First Monday Peer-Reviewed Journal on the Internet. 
  12. Fuglerud, K.S., Hallbach, T., & Tjostheim, I. (2015). Cost-benefit analysis of universal design: Literature review and suggestions for future work. Norsk Regnesentral Norwegian Computing Center. 
  13. Kanady, S., Muncie, N., & Missimer, K. (2020). An Inclusive Future of Work: A Systems Approach. SourceAmerica.