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To what extent have relaxed eligibility requirements and increased generosity of disability benefits acted as disincentives for employment? A systematic review of evidence from countries with well-developed welfare systems
  1. Ben Barr1,
  2. Stephen Clayton2,
  3. Margaret Whitehead2,
  4. Karsten Thielen3,
  5. Bo Burström4,
  6. Lotta Nylén5,
  7. Espen Dahl6
  1. 1Division of Public Health, University of Liverpool, Liverpool, UK
  2. 2University of Liverpool, Liverpool, UK
  3. 3Copenhagen University, Copenhagen, Denmark
  4. 4Department of Public Health Sciences, Karolinska Institute, Stockholm, Sweden
  5. 5Karolinska Institute, Stockholm, Sweden
  6. 6Oslo University College, Oslo, Norway
  1. Correspondence to Mr Ben Barr, Division of Public Health, University of Liverpool, Whelan Building, Liverpool, L69 3GB, UK; b.barr{at}liverpool.ac.uk

Abstract

Background Reductions in the eligibility requirements and generosity of disability benefits have been introduced in several Organisation for Economic Cooperation and Development (OECD) countries in recent years, on the assumption that this will increase work incentives for people with chronic illness and disabilities. This paper systematically reviews the evidence for this assumption in the context of well-developed welfare systems.

Method Systematic review of all empirical studies from five OECD countries from 1970 to December 2009 investigating the effect of changes in eligibility requirements or level of disability benefits on employment of disabled people.

Results Sixteen studies were identified. Only one of five studies found that relaxed eligibility was significantly associated with a decline in employment. The most robust study found no significant effect. On generosity, eight out of 11 studies reported that benefit levels had a significant negative association with employment. The most robust study demonstrated a small but significant negative association.

Conclusion There was no firm evidence that changes in benefit eligibility requirements affected employment. While there was some evidence indicating that benefit level was negatively associated with employment, there was insufficient evidence of a high enough quality to determine the extent of that effect. Policy makers and researchers need to address the lack of a robust empirical basis for assessing the employment impact of these welfare reforms as well as potentially wider poverty impacts.

  • Disability insurance
  • disability SI
  • disabled persons
  • employed CG
  • employment
  • social inequalities
  • social welfare
  • socioeconomic factors

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Footnotes

  • Funding SC and MW were funded by the Public Health Research Consortium (PHRC), which is funded by the Department of Health Policy Research Programme. BB was on an attachment with the PHRC as part of the Mersey Deanery Public Health training programme.

  • Provenance and peer review Not commissioned; externally peer reviewed.

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