Economic consequences of workplace injuries and illnesses: lost earnings and benefit adequacy

Abstract

Background: This is the first study based on individual data to estimate earnings lost from virtually all reported workplace injuries and illnesses in a state.

Methods: We estimated lost earnings from workplace injuries and illnesses occurring in Wisconsin in 1989-90, using workers' compensation data and 6 years of unemployment insurance wage data. We used regression techniques to estimate losses relative to a comparison group.

Results: The average present value of losses projected 10 years past the observed period is over $8,000 per injury. Women lose a greater proportion of their preinjury earnings than do men. Replacement of after-tax projected losses averages 64% for men and 50% for women.

Conclusions: Overall, workers with compensated injuries and illnesses experienced discounted pre-tax losses projected to total over $530,000,000 (1994 dollars), with about 60% of after-tax losses replaced by workers' compensation. Generally, groups losing over eight weeks' work received workers' compensation benefits covering less than 40% of their losses.