In determining economic damages, there are three key players. The doctor determines the plaintiff’s work restrictions, and the economist calculates the past and future loss of earnings.
First of all, the vocational expert identifies the appropriate jobs for the plaintiff, guided by the physician’s work restrictions, and identifies salaries associated with these positions. Secondly, the vocational expert calculates the plaintiff’s diminished probability of employment.
Typically, injured plaintiffs earn less in the jobs utilizing the physician’s work restrictions and experience a reduced probability of employment, causing further loss of earnings because they are disabled individuals.
For example, a 35-year-old Hispanic truck driver with a high school education becomes injured. The doctor restricts the plaintiff to sedentary work (sitting most of the time), meaning the plaintiff is unable to return to work as a truck driver. With a sedentary restriction, the plaintiff could work as a truck dispatcher.
If the plaintiff earned $50,000 per year as a truck driver and only $25,000 per year as a dispatcher, the loss of earnings remains obvious. However, in addition to earning less as a dispatcher, the plaintiff will experience additional loss of earnings because of a reduced probability of employment as a disabled person due to difficulty locating employment and competing on the job, and a reduced work life expectancy.
According to the U.S. Census Bureau 2014 Current Population Survey, Annual Social and Economic Supplement, an able-bodied 35-year-old Hispanic male with a high school education has an 89% probability of employment, while a non-severely disabled 35-year-old Hispanic male with a high school education would have a 69.3% probability of employment, equaling a diminished probability of employment of 19.7%.
Thus, an additional 19.7% loss of earnings as a truck dispatcher earning $25,000 per year, means an additional $4,925 in economic loss per year.