Unequal use of social insurance benefits: The role of employers

Disability Insurance (DI) and Paid Family Leave (PFL) programs are important sources of social insurance, but there is considerable inequality in benefit take-up, and little is known about the role of firms in determining benefit use. Using administrative data from California, we find that firms that pay higher earnings premiums also have substantially higher public DI and PFL take-up rates, and that this relationship is particularly strong among the lowest-earning workers within the firm. Our results suggest that changes in firm behavior may impact social insurance use, thus reducing an important dimension of inequality in America. (c) 2022 Elsevier B.V. All rights reserved.

Automated summary

Disability Insurance (DI) and Paid Family Leave (PFL) programs are important social insurance programs, and the study finds that firms with higher earnings premiums have higher DI and PFL take-up rates, particularly among low-earning workers. This suggests that changes in firm behavior can impact social insurance use and reduce inequality in America.