Welfare reform: Employment, mental health and intrahousehold insurance

Mike Brewer, Thang Dang () and Emma Tominey ()

No 23-06, CEPEO Working Paper Series from UCL Centre for Education Policy and Equalising Opportunities

Abstract: The UK Universal Credit (UC) welfare reform simplified the benefits system, combining six benefit applications into one, whilst creating strict incentives for full-time employment. Exploiting a staggered roll-out, we analyse the impact of entering unemployment under UC compared to the former system on mental health, future employment transitions and intrahousehold labour supply reactions. Groups with fewer intrahousehold insurance possibilities - single adults and lone parents - experience a mental health deterioration of 8.4-13.9% sd. Whilst these groups experience an increase in employment transition, it is to part-time work. For couples UC creates an intrahousehold reaction, increasing partners' labour participation and UC partially or fully mitigates the mental health consequences of unemployment.

Keywords: Welfare reform; Mental health; Employment transitions; Universal Credit; Intrahousehold insurance (search for similar items in EconPapers)
JEL-codes: D13 D61 H53 I10 I14 I38 J2 (search for similar items in EconPapers)
Pages: 64 pages
Date: 2023-07
New Economics Papers: this item is included in nep-hea and nep-lma
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https://repec-cepeo.ucl.ac.uk/cepeow/cepeowp23-06.pdf First version, 2023 (application/pdf)

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Persistent link: https://EconPapers.repec.org/RePEc:ucl:cepeow:23-06

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