Traumatic brain injury often impacts earning capacity for years or permanently. Lost earning capacity damages compensate victims for reduced ability to work and earn—often representing millions of dollars over a working lifetime.

Lost Wages vs. Lost Earning Capacity

Lost wages compensate for actual income missed during treatment and recovery—a straightforward calculation based on actual earnings.

Lost earning capacity compensates for reduced future earning ability—projecting what the victim would have earned over their career versus what they can earn now with TBI.

How TBI Affects Earning Capacity

Cognitive Impairments

  • Memory problems affecting job performance
  • Slowed processing reducing productivity
  • Difficulty concentrating in work environments
  • Problems with complex thinking and problem-solving

Physical Limitations

  • Fatigue limiting work hours
  • Headaches requiring breaks
  • Light/noise sensitivity making certain workplaces intolerable
  • Balance problems affecting physical work

Emotional/Behavioral Issues

  • Irritability affecting workplace relationships
  • Depression reducing motivation and performance
  • Anxiety in work situations

Calculating Lost Earning Capacity

Establishing Pre-Injury Trajectory

Economists analyze:

  • Pre-injury earnings history
  • Education and training
  • Career trajectory and advancement potential
  • Industry trends and typical career progression

Determining Post-Injury Capacity

Vocational experts assess:

  • Remaining work abilities
  • Jobs the victim can still perform
  • Earnings potential in those jobs
  • Need for accommodations

Calculating the Difference

The lost earning capacity equals projected earnings without injury minus projected earnings with injury, calculated to present value.

Expert Witnesses

Vocational Rehabilitation Expert

Evaluates functional capacity and identifies jobs within the victim's abilities.

Economist

Calculates present value of lost future earnings using appropriate discount rates and projections.

Challenges

  • Speculation claims – Defense argues projections are guesswork
  • Mitigation – Claims victim could work but chooses not to
  • Pre-existing factors – Arguments that other conditions limit earning capacity

Conclusion

Lost earning capacity often represents the largest damage component in serious TBI cases. Proper calculation requires qualified vocational and economic experts who can project lifetime impact and withstand defense challenges.