Estimating population mental health effects of the rollout of Universal Credit: difference-in-differences analyses using the UK Household Longitudinal Study, 2009 – 2019

Matteo Richiardi, Clare Bambra, Matt Sutton, Srinivasa Vittal Katikireddi, Sophie Wickham, David Taylor-Robinson, Peter Craig, Benjamin Barr, Steph Morris, Samuel Hugh-Jones, Maria Marimpi, Andy Baxter, Mandy Cheetam and Luke Monford

No CEMPA3/25, Centre for Microsimulation and Policy Analysis Working Paper Series from Centre for Microsimulation and Policy Analysis at the Institute for Social and Economic Research

Abstract: Background: Universal Credit (UC), introduced in 2013, has led to acute health harms among unemployed people, but the policy’s impacts longer-term and on broader claimant groups remain unknown. Methods: We exploited the geographical variation in UC rollout to investigate impacts on population mental health (SF-12 Mental Component Summary) for up to four years following implementation for a larger cohort of claimants, including employed people. We linked 108, 247 observations (29,528 individuals) from the UK Household Longitudinal Study between 2009- 2019 to administrative Local Authority district data. We used standard and novel difference-in-differences approaches to estimate the average effect in the follow-up period and at different time points post-introduction, comparing a working age UC eligible population (treatment group) to an alternative benefits population (comparison group).Findings: UC was associated with mental health declining by 0·70 units (95% CI -1·24 to -0·15), a 1·5% relative reduction. Effects were larger during the first year of exposure (-1·01, 95% CI -1·93 to - 0·10) without returning to baseline levels. Between 2013 and 2019, an estimated 111,954 (95% CI 35,497 to 182,948) additional people experienced depression and/or anxiety after UC’s introduction, 27,115 of whom may have reached diagnostic threshold for common mental disorders. Interpretation: UC led to a sustained deterioration in population mental health, particularly marked in the first year of implementation. Reforms to UC are warranted to mitigate adverse mental health impacts.

Date: 2025-02-22
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