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

Author

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

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.

Suggested Citation

  • Richiardi, Matteo & Bambra, Clare & Sutton, Matt & Vittal Katikireddi, Srinivasa & Wickham, Sophie & Taylor-Robinson, David & Craig, Peter & Barr, Benjamin & Morris, Steph & Hugh-Jones, Samuel & Marim, 2025. "Estimating population mental health effects of the rollout of Universal Credit: difference-in-differences analyses using the UK Household Longitudinal Study, 2009 – 2019," Centre for Microsimulation and Policy Analysis Working Paper Series CEMPA3/25, Centre for Microsimulation and Policy Analysis at the Institute for Social and Economic Research.
  • Handle: RePEc:ese:cempwp:cempa3-25
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    References listed on IDEAS

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    2. Jordà, Òscar & Nechio, Fernanda, 2023. "Inflation and wage growth since the pandemic," European Economic Review, Elsevier, vol. 156(C).
    3. Brewer, Mike & De Agostini, Paola, 2015. "The National Minimum Wage and its interaction with the tax and benefits system: a focus on Universal Credit," EUROMOD Working Papers EM2/15, EUROMOD at the Institute for Social and Economic Research.
    4. Richard Machin & Allan Reynolds, 2024. "New development: The commodification of social security medical assessments—academic analysis and practitioner experience," Public Money & Management, Taylor & Francis Journals, vol. 44(4), pages 335-338, May.
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