Work from Home and the Productivity Gains from Rising Disability Employment

Since the pandemic, the supply of workers with disabilities has risen substantially, a trend largely attributed to the expansion of remote work opportunities. This paper examines how the rise in work from home (WFH) among disabled workers has affected productivity. Leveraging plausibly exogenous industry-level variation in WFH among disabled workers, I show that a 1SD (4pp) increase in disabled WFH is associated with consistent increases in labor productivity between 2021 and 2023, ranging from 2% to 6%. Additionally, I show that disabled WFH increases real value added per hour by 2%. Beyond productivity, I examine how the rise in remote work among disabled workers has impacted employment across firm age and size groups. I document a reallocation of employment from small and young firms to larger, incumbent firms, likely reflecting the latter’s greater capacity to implement remote work at scale. These findings suggest that while WFH among disabled workers has enhanced productivity, it has also contributed to increased labor market concentration, favoring larger and older firms over their smaller and younger counterparts.