But a federal law protecting transgender workers remains crucial to getting to the root of the unemployment problem, advocacy groups say. And there's growing optimism it could happen, with state anti-discrimination laws that specifically protect transgender employees now covering 45 percent of the population -- up from 5 percent about 10 years ago.

Even so, it's often hard to prove a discrimination case.

In one of the biggest recent victories, Vandy Beth Glenn sued the Georgia General Assembly for firing her immediately after she told her boss that she planned to transition from male to female. A federal appeals court based in Atlanta ruled that treating her differently due to her gender identity violated the Constitution's Equal Protection clause. Glenn was given back her job editing proposed state legislation, and the court even went on to rule that public and private employers can't fire transgender workers because of their gender identity, said Greg Nevins, an attorney at Lambda Legal who represented Glenn.

"Once (employers) are aware of what is prohibited, I think it will get rid of a lot of the barriers to transgender individuals having the right to earn a living and be part of the workforce," said Nevins.