Vocational Rehabilitative Services
Industry Profile Report
Dive Deep into the industry with a 25+ page industry report (pdf format) including the following chapters
Industry Overview Current Conditions, Industry Structure, How Firms Operate, Industry Trends, Credit Underwriting & Risks, and Industry Forecast.
Call Preparation Call Prep Questions, Industry Terms, and Weblinks.
Financial Insights Working Capital, Capital Financing, Business Valuation, and Financial Benchmarks.
Industry Profile Excerpts
Industry Overview
The 4,000 vocational rehabilitative services providers offer job counseling, job training, and work experience to unemployed and underemployed persons, persons with disabilities, and persons who have a job market disadvantage because of lack of education, job skill, or experience. The industry includes job training facilities and sheltered workshops (which employ adults with physical or intellectual disabilities).
Dependence on Government Funding
The vocational rehabilitative (VR) services industry is highly dependent on a mix of federal and state government funding.
Heavy Caseloads
Heavy caseloads, particularly in urban centers, can compromise the quality of services, which affects job placement.
Industry size & Structure
The average vocational rehabilitative services provider employs about 70 workers and generates $4 million annually.
- The vocational rehabilitative services industry consists of about 4,000 firms that employ over 281,000 workers and generate about $16 billion annually.
- The industry is fragmented with the top 50 companies accounting for about 30% of industry revenue.
- More than 70% of establishments are tax-exempt organizations.
- State agencies administer services and funding for vocational and rehabilitative services. Large non-profit organizations like Goodwill and Easter Seals also offer vocational rehabilitative services.
- In the US, 13% of civilians live with a disability, according to the Disability Statistics Compendium.
Industry Forecast
Vocational Rehabilitative Services Industry Growth
Recent Developments
Nov 14, 2024 - Proactive Recruitment Boosts Hiring Success
- Proactively recruiting workers with disabilities leads to greater job success, with 50% of successfully performing employees having been recruited through intentional efforts, according to Andrew Houtenville, PhD, Professor of Economics and Research Director at the University of New Hampshire. "Partnering with disability organizations and state vocational rehabilitation agencies is an effective hiring strategy, with 84% of companies finding these partnerships successful in filling positions." Providing workplace accommodations is a key factor in helping employees with disabilities perform effectively in their jobs. "Workplace accommodations, such as flexible schedules and assistive devices, play a critical role in the success of employees with disabilities, and most can be provided with little to no cost,” explained John O’Neill, PhD, Director, Center for Employment and Disability Research at the Kessler Foundation.
- Employment and labor force participation trends for people with disabilities appear to be stabilizing after several years of growth that reduced the gaps between individuals with and without disabilities, according to the most recent National Trends in Disability Employment (nTIDE) report. Both groups saw decreases in employment and labor force participation from June through August 2024, reflecting a broader workforce trend. This fluctuation is not unprecedented; similar patterns were observed pre-pandemic, particularly between 2016 and 2018, when employment gains for people with disabilities leveled off following a period of strong growth. The current decrease may indicate a similar leveling off, nTIDE researchers said.
- A $1.2 trillion federal funding package signed into law in 2024 includes more money for special education and disability employment. The spending plan features $14.2 billion in funding for state grants under the Individuals with Disabilities Education Act, a $20 million increase over 2023. Vocational rehabilitation will see a $304 million increase, bringing the program to $4.25 billion. Home and community-based supportive services, state developmental disabilities councils, protection and advocacy agencies and many other programs that people with disabilities rely on will see level funding, which some disability advocates say is essentially a cut when inflation is factored.
- Vocational rehabilitation service industry revenue increased 8.5% year over year but decreased 2% quarter over quarter during Q1 2024 to $4,538 million, according to the US Census Bureau. Vocational rehabilitative service sales are forecast to increase at a 4.88% compounded annual rate from 2024 to 2028, faster than the growth of the overall economy, according to Inforum and the Interindustry Economic Research Fund, Inc. Community vocational rehabilitative service revenue typically comes from contracts with state vocational rehabilitation agencies, which authorize billable services. Fee-for-services contracts base payment on hourly, daily, half-day, or other unit-based rates. Vocational rehabilitative service industry employment decreased slightly and average wages for nonsupervisory employees increased slightly during the first nine months of 2024, according to the US Bureau of Labor Statistics.
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