Universal Credit: Welfare Reform and Mental Health

Discussion Paper
30 December 2022

Mike Brewer, Thang Dang, Emma Tominey

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.

EfD Authors

Files and links

Sustainable Development Goals
Publication reference
Brewer, M., Dang, T., & Tominey, E. (2022). Universal Credit: Welfare Reform and Mental Health. SSRN Electronic Journal. https://doi.org/10.2139/ssrn.4114738
Publication | 30 December 2022