Universal Credit: Welfare Reform and Mental Health

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

No 15178, IZA Discussion Papers from IZA Network @ LISER

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 entering 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% sd. 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.

Keywords: universal credit; decomposition; mediation; mental health; welfare reform (search for similar items in EconPapers)
JEL-codes: D61 I10 I14 I38 (search for similar items in EconPapers)
Pages: 56 pages
Date: 2022-03
New Economics Papers: this item is included in nep-eur and nep-hea
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Published - published in: Journal of Health Economics, 2024, 98, 102940

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Related works:
Journal Article: Universal Credit: Welfare reform and mental health (2024)
Working Paper: Universal Credit: Welfare Reform and Mental Health (2022)
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