How Vermont Outpaced the Nation in Disability Employment

Vermont has significantly outpaced the nation in disability employment by eliminating sheltered workshops and subminimum wages in 2002, adopting a supported, integrated employment model. This policy shift has led to a sustained increase in employment rates for individuals with intellectual and developmental disabilities, demonstrating the success of inclusive economic policy.

Nathaniel Brooks

March 30, 2026 · Updated October 8, 2026 · 5 min read

For more than two decades, Vermont has achieved a rate of employment for individuals with intellectual and developmental disabilities that significantly outpaces the rest of the United States. This success is not an accident but the result of a foundational policy shift made in 2002 to eliminate segregated workplaces and subminimum wages. By committing to a model of competitive, integrated employment, the state has seen the number of people with developmental disabilities in the workforce steadily climb, while national figures have remained largely stagnant, providing a powerful case study in inclusive economic policy.

The Historical Shift: Ending Sheltered Workshops

Prior to 2002, Vermont’s approach to disability employment mirrored that of other states, relying on segregated facilities known as sheltered workshops. These workplaces were designed exclusively for people with intellectual and developmental disabilities, isolating them from the general workforce. A report from the Vermont Coalition for Independent Living notes that in these settings, workers were often paid "subminimum" wages, a practice that remains legal under federal law but keeps individuals in a cycle of poverty and dependence. This model was based on a presumption of incapacity, suggesting that people with certain disabilities were not able to work in mainstream environments.

In a pioneering move, Vermont became the first state in the nation to reject this model entirely. In 2002, it closed its last sheltered workshop and eliminated the use of subminimum wages for people with disabilities. This decision was accompanied by a deliberate increase in state investment for supported employment programs. The new focus was on bringing workers with disabilities into integrated community jobs where they would earn wages comparable to their non-disabled coworkers. This policy represented a fundamental change in philosophy: from segregation and protection to inclusion and opportunity, asserting that all citizens are capable of meaningful work when given the proper support.

The transition required building a new infrastructure of services designed not to occupy individuals in separate facilities, but to help them find and succeed in jobs within the broader economy. This approach, known as competitive, integrated employment, became the cornerstone of the state's disability services. By 2018, census data showed the tangible results of this long-term commitment, with nearly 22,000 Vermonters with disabilities between the ages of 18 and 64 having worked at some point in the previous year.

Vermont's Employment Outcomes for Individuals with I/DD (1996-2021)

The dramatic impact of Vermont's policy shift is most evident in long-term employment data. Research from the University of Vermont's Center on Disability & Community Inclusion tracks the percentage of people receiving services for intellectual and developmental disabilities (I/DD) who are employed. The data reveals a profound and sustained divergence between Vermont and the national average, beginning shortly after the state fully committed to its integrated model.

While the national employment rate for this population has remained flat for a quarter-century, Vermont's has more than doubled. This sustained gap provides concrete evidence that the state's choice to abandon segregated employment models in favor of supported, integrated work has produced vastly superior outcomes.

Employment Rates for Individuals Receiving I/DD Services, Vermont vs. USA
Year	Vermont Employment Rate	USA Employment Rate
1996	20%	22%
2015	48%	19%
2021	47%	22%

In 1996, Vermont's employment rate of 20% was slightly below the U.S. average of 22%. After the state closed its last sheltered workshop in 2002, its rate began a steady climb. By 2015, Vermont's employment rate had soared to 48%, while the national average, according to a report from that year, had fallen to 19%. More recent data from 2021 shows Vermont's rate at 47%, holding strong despite the economic disruptions of the COVID-19 pandemic, while the national rate remained unchanged at 22%. The University of Vermont researchers conclude, "The number of Vermonters with intellectual and developmental disabilities receiving supported employment has steadily increased over time... This trend began during early initiatives to prioritize supported employment and has continued for over two decades since the last sheltered workshop closed."