Universal Credit: Welfare Reform and Mental Health

Mike Brewer; Thang Dang; Emma Tominey

doi:10.1016/j.jhealeco.2024.102940

Universal Credit: Welfare Reform and Mental Health

Mike Brewer, Thang Dang, Emma Tominey

Economics

Research output: Contribution to journal › Article › peer-review

Abstract

The UK Universal Credit (UC) welfare reform simplified the benefits system whilst strongly incentivising a return to sustainable employment. Exploiting a staggered roll-out, we estimate the differential effect of unemployment under UC versus the former system on mental health. Groups with fewer insurance possibilities - single adults and lone parents - experience a mental health deterioration of 8.4-13.9% standard deviations which persists into the subsequent year. For couples, UC partially or fully mitigates mental health consequences of unemployment. Exploring mechanisms, for single adults and lone parents, reduced benefit income and strict job search requirements dominate any positive welfare effects of the reduced administrative burden of claiming benefits.

Original language	English
Article number	102940
Number of pages	20
Journal	Journal of Health Economics
Volume	98
Early online date	13 Nov 2024
DOIs	https://doi.org/10.1016/j.jhealeco.2024.102940
Publication status	Published - 1 Dec 2024

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Cite this

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