Discussion and Takeaways

This report produced a first of its kind dataset, available here, and results that shed light on the use of and elimination of the subminimum wage and the programs that provide the comprehensive support disabled workers need. Among the many lessons embedded in each state’s data, we see three key takeaways that carry over from state to state.

Over the past six years, there has been a marked trend toward phasing out the use of subminimum wage, as demonstrated in Figure 5. The reduction in use of subminimum wage parallels an increase in the employment of disabled workers in the workforce, with historic levels of labor force participation.¹ Many states are moving in the direction of supporting workers with disabilities in a more comprehensive way, as shown in the results. Using the Wage and Hour data from July 2023, we see that no state has more than 4,000 workers with disabilities paid a subminimum wage, and the vast majority (36) have less than 1,000 workers with disabilities paid a subminimum wage. This is a significant change from just six years ago, when only 18 states had less than 1,000 workers with disabilities paid a subminimum wage.

Further demonstrating this change is the percent change in workers and percent change in issued certificates as described in the findings section and shown as rankings in Figure 5. An impressive 46 states had a 50 percent or more reduction in workers paid under 14(c) certificates from 2018 to 2023. One state to mention is Mississippi, with a remarkable 94.8 percent decrease in workers paid a subminimum wage from 2018 to 2023. Not only was the percentage high, the number of workers was also high—a drop of nearly 1,500 workers. Iowa is another state that had a remarkable decrease in workers paid a subminimum wage from 2018 to 2023, a decrease of 84.1 percent. Like Mississippi, Iowa also had a large decrease in the number of people employed, not only the percentage, reducing the number of workers paid under 14(c) certificates by 2,034.

As of the writing of this report, 12 states have no workers with disabilities paid a subminimum wage because of fully eliminating their 14(c) certificates or via other means; an additional five states are in process of phasing it out. Our analysis demonstrates the dramatic shift away from subminimum wage employment, with 17 states at or moving to zero and many others on a similar trajectory. After years of stagnation, most states are making changes to move away from subminimum wage employment.

The top 21 ranked states, all with scores higher than 60 out of 100 as displayed in Figures 2 and 3, show a range of different characteristics, such as population size, location, physical size, and political views. Several of these states are large, with strong urban cores, such as California, Maryland, and Illinois. Other states had smaller populations such as Rhode Island, Alaska, Vermont, and Wyoming. Several states are rural, while others are more urban. Some of the states are more centrally located in the United States while others are coastal. Finally, critically important to the policy recommendations found later in this report, there is a range of political views demonstrated across the top 21 states, from very progressive states to traditionally conservative states and others in between.

Equally important, the states with the lowest scores showed less differentiation but still some diversity across characteristics. The states ranked 38 through 51 had total scores below 50. These states did have fewer large urban cores than those in the top 21. Several of these states scored in the middle to upper ranges of category 2 (use of subminimum wage) and category 3 (employment policy and funding initiatives). However, nearly all of these states significantly struggled with policy engagement of subminimum wage and financial security support.

This diversity of characteristics demonstrates that phasing out and eliminating the subminimum wage is not limited to a state type, specific characteristics, or political leanings. Any state can phase out or eliminate it.

Previous research on subminimum wage has primarily focused on use of the 14(c) certificate or, separately, on the employment of workers with disabilities in competitive integrated employment. Workers with disabilities transitioning from low-wage work need comprehensive supports as they enter the workforce; our research looked at multiple factors that have been shown to make a difference for disabled workers, including Medicaid, funding initiatives, proactive employment policies, benefits counseling, and financial support. While the total score for each state has two categories focused on subminimum wage (policy and use), the comprehensive supports significantly factor into the final score.

For example, as shown in Figure 3, we found no sign of policy engagement in Louisiana to eliminate subminimum wage (category 1), resulting in a score of 25. But through other efforts, Louisiana has significantly reduced the use of subminimum wage between 2018 and 2023, resulting in a 90.1 in category 2. Louisiana also has employment policies and funding initiatives to support disabled workers (category 3) resulting in a 61.1 and scored a 100 in the final category of support of financial security. Louisiana is an example of a state that is on its way to eliminating the subminimum wage and supporting disabled workers through comprehensive supports. Iowa, West Virginia, and Nebraska are three other states, among several others in the ranks between 18 through 35, that have less action on the policy front to eliminate subminimum wage but scored well in the other three categories, demonstrating comprehensive supports and setting the stage for the elimination of the subminimum wage in coming years.

States can look at each other’s efforts, including policy changes, comprehensive supports, and employment systems, to see how lasting change can be made. For example, Massachusetts, Iowa, Michigan, Washington, Connecticut, Georgia, Colorado, Louisiana, Mississippi, Tennessee, and Maryland are examples of states that had significant decreases (more than 80 percent) in the use of subminimum wage from 2018 to 2023. Some of these states excel in the other three categories. Some are building capacity. But all are creating lasting change for their workers with disabilities.

Our data provide a point-in-time view of how states are doing on their path toward eliminating subminimum wage and supporting disabled workers. Taken together—state policy change to phase out or eliminate subminimum wage, reduction in use of subminimum wage, proactive employment policies, and support of financial security—the categories provide insight into how many states have an employment system that enables success for their disabled employees as a transition from subminimum wage occurs.