The rapid growth of supported employment programs in the last five years has been accompanied by the strong belief that through such programs many people with severe disabilities would be more satisfied with their lives and receive higher earnings than in sheltered workshops, work activity centers, and adult day care. This paper presents data collected in New York State that test these propositions and compare the benefits with the costs of operating the supported employment program.

This investigation presents a cost-benefit analysis completed for one of 27 states implementing supported employment as a result of federal funding. Based upon the benefits and costs detailed, society realized a $0.75 return for every $1.00 invested in supported employment in Illinois. Supported employees realized a 37% increase in their earnings over a comparable period. The results of this study are discussed and recommendations are made for similar analyses across states.

Evidence about the benefits and costs of supported and transitional employment for persons with severe disabilities is presented along with relevant caveats in the absence of controlled studies. Some of the major forms of supported and transitional employment services are compared with adult day care and traditional sheltered workshops, including work activity centers. Despite weaknesses in the data, sufficient information exists to argue that all forms of employment—supported, transitional, and sheltered—are more productive in terms of earnings and less costly to provide than adult day care. The lack of definitive data is seen as a major impediment to the expansion of supported and transitional employment options for people with severe disabilities; hence, stricter accountability is recommended. All service providers, regardless of the vintage of their programs, should be required to show benefits and costs within a uniform framework of measurement.

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Information was gathered via a mailed questionnaire from approximately 85% of Maryland service providers offering vocational services funded by the Maryland Developmental Disabilities Administration. The weekly earnings of persons placed in supported employment were 3.5 times the earnings of persons employed on the premises of the service provider. Nevertheless, there was strong evidence that substantial improvements are needed, and possible, in supported employment. Among urgently needed improvements are (a) the ability to recruit and retain qualified vocational workers, (b) enhanced procedures for locating more and higher quality jobs, (c) expanded transportation arrangements, (d) improved training for vocational workers, and (e) an information system to measure performance and identify problems.