Minnesota cuts employment services for people with disabilities

Emily Vuong went from almost weekly in-person meetups with an employment specialist to sporadic virtual meetings and slower replies to her emails.

The 19-year-old, who has autism and selective mutism, participates in Minnesota’s Vocational Rehabilitation program, which provides employment services for people with disabilities. She said recent state changes to the service mean she is no longer getting the same level of support or responsiveness.

“I really want to work,” she said. “And I don’t know when that is going to happen.”

Nearly 14,000 Minnesotans with disabilities, such as autism, serious mental illness, traumatic brain injuries and intellectual disabilities, received services last year through the programs that help people find jobs and get the training and accommodations they need to participate and advance in the workforce.

But as demand for the services is growing, Minnesota is cutting back.

The Department of Employment and Economic Development is looking at voluntary layoffs and early retirement incentives for employees who provide Vocational Rehabilitation Services (VRS) while having staff take on more work in-house instead of using outside providers.

People who work in the field say clients aren’t getting the same quality of services they previously did as fewer people are taking on higher caseloads. They expect many people seeking help will end up on waitlists.

“We’re going to see some people going backwards,” said Laura Johnson, executive director of Hubbard County Developmental Achievement Center, which provides contract services through the program and has seen the number of clients referred to them plummet.

She and other disability service providers fear Minnesota could backslide on the goal of getting more people into competitive, integrated employment.

The Vocational Rehabilitation program got more than $67 million in state and federal funds last fiscal year, with the bulk of the money coming from the U.S. Department of Education.

State dollars for the program have remained flat in recent years while more people are entering the program and some of their case services are getting more expensive, DEED Deputy Commissioner Evan Rowe said. Then there’s the federal budget uncertainty.

“All those pieces taken together has meant that we’ve needed to work to manage the budget to get it to a sustainable path,” he said. “It’s not like a budget mistake or anything like that.”

But people who worked with the program — both inside state government and outside providers — questioned why the spending concerns weren’t addressed earlier and said the abrupt steps DEED has been taking to cut costs are hurting Minnesotans with disabilities.

The agency started taking action last summer to rein in expenses, Rowe said, including implementing a hiring freeze and being more cautious about authorizing spending on services. But costs continued to go up headed into 2025. Now they are looking at additional measures, like voluntary layoffs among the roughly 430 staff members.

They may also have to slow intake, he said, potentially resulting in clients ending up on waitlists — something they haven’t seen since before the pandemic. If that happens, he said DEED would prioritize services for those with the greatest need.

“VRS clients who are in the program right now are going to continue to receive the same level of service, and everything that we’re doing is trying to make sure that the program is on sound financial footing and we’re able to deliver a really high-quality level of service,” Rowe said.

However, state staff — who asked not to be named for fear of retribution — said they aren’t able to provide all clients with the same level of job services they previously had been receiving from outside contractors.

Outside providers said their caseloads are far smaller than state workers’ so they are able to have more frequent client check-ins, and they have more specialized experience and are more likely to drive to work sites or different locations to support people in the community.

Christine Houle, whose daughter has been receiving Vocational Rehabilitation Services for several years, said such contractors are essential.

Her daughter’s counselor at DEED has been wonderful at setting up meetings and directing them through next steps, but she said it was outside provider Elizabeth Jones who was key to building her daughter’s self-esteem, helping her make a résumé and get the job she wanted sterilizing equipment at Abbott Northwestern Hospital.

“Without this program, I think she would have dropped off everybody’s radar but ours and she would not be able to support herself,” Houle said. “With this program, and with the support of people like Liz, she will be independently stable.”

Organizations across the state said their referrals from DEED have dropped in recent months as the state agency is having its employees handle more work in-house.

Johnson’s nonprofit in Hubbard County served about 65 students last year with pre-employment transition services, which is part of VRS. The transition services help people ages 14 to 21 explore jobs, receive career planning, learn how to advocate for themselves in the workplace and participate in experiences like apprenticeships and job shadowing.

They are now just working with a handful of students and expect to stop getting young people referred to them soon, Johnson said.

Rise, which serves about 500 people annually through VRS, has seen referrals drop by about 25% so far this year compared with this point in 2024, the nonprofit’s president and CEO Tim Dickie said.

Doris Illies said she started to get fewer referrals to her business, Illies Consulting, last September and she has laid off staff as a result and may have to close her agency. They’ve gone from serving more than 300 people through the VRS program to about 80.

“We really were trying to help students set up for success long-term and it just got pulled. For some students, up until September we were setting up work experiences where they got to try out different jobs,” she said. “The work experiences basically got yanked away.”

Illies said there’s a strong return on taxpayer dollars when the Vocational Rehabilitation program successfully helps people with disabilities land jobs.

Vuong was among those who previously received VRS services from Illies Consulting and had that relationship severed. She said it can be difficult to get in contact with her counselor at the state since the change and it is hard to be patient as she is trying to get help with her Free Application for Federal Student Aid and wants to set up a job soon to earn money.

Vuong started participating in vocational rehabilitation in high school and is now attending St. Paul College and looking at a career in nursing or psychology. She stressed the importance of the employment services for her and others with disabilities.

“It gives a lot of hope to people,” she said. “Because I didn’t know what I wanted to do.”