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The effect of welfare reform on the health of the unemployed: evidence from a natural experiment in Germany
  1. Faraz V Shahidi1,2,
  2. Carles Muntaner1,3,
  3. Ketan Shankardass1,4,5,
  4. Carlos Quiñonez1,6,
  5. Arjumand Siddiqi1,7
  1. 1Dalla Lana School of Public Health, University of Toronto, Toronto, Ontario, Canada
  2. 2Institute for Work and Health, Toronto, Ontario, Canada
  3. 3Bloomberg Faculty of Nursing, University of Toronto, Toronto, Ontario, Canada
  4. 4Department of Psychology, Wilfrid Laurier University, Waterloo, Ontario, Canada
  5. 5Centre for Urban Health Solutions, St. Michael’s Hospital, Toronto, Ontario, Canada
  6. 6Faculty of Dentistry, University of Toronto, Toronto, Ontario, Canada
  7. 7Gillings School of Public Health, University of North Carolina at Chapel Hill, Chapel Hill, North Carolina, United States
  1. Correspondence to Dr Faraz V Shahidi, Dalla Lana School of Public Health, University of Toronto, Toronto, ON M5S, Canada; fshahidi{at}iwh.on.ca

Abstract

Background Over the past several decades, governments have enacted far-reaching reforms aimed at reducing the generosity and coverage of welfare benefits. Prior literature suggests that these policy measures may have deleterious effects on the health of populations. In this study, we evaluate the impact of one of the largest welfare reforms in recent history—the 2005 Hartz IV reform in Germany—with a focus on estimating its effect on the health of the unemployed.

Methods We employed a quasi-experimental difference-in-differences (DID) design using population-based data from the German Socio-Economic Panel Study, covering the period between 1994 and 2016. We applied DID linear probability modelling to examine the association between the Hartz IV reform and poor self-rated health, adjusting for a range of demographic and socioeconomic confounders.

Results The Hartz IV reform was associated with a 3.6 (95% CI 0.9 to 6.2) percentage point increase in the prevalence of poor self-rated health among unemployed persons affected by the reform relative to similar but unaffected controls. This negative association appeared immediately following the implementation of the reform and has persisted over time.

Conclusion Governments in numerous European and North American jurisdictions have introduced measures to further diminish the generosity and coverage of welfare benefits. In line with growing concerns over the potential consequences of austerity and associated policy measures, our findings suggest that these reform efforts pose a threat to the health of socioeconomically disadvantaged populations.

  • social epidemiology
  • health inequalities
  • socio-economic
  • self-rated health
  • policy
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Footnotes

  • Contributors FVS, CM, KS, CQ and AS planned and conceptualised the study. FVS acquired and analysed the data. FVS, CM, KS, CQ and AS interpreted the data, wrote the manuscript and revised it critically for intellectual context. All authors approved the final manuscript as submitted and agree to be accountable for all aspects of the work.

  • Funding FVS is supported by the Canadian Institutes of Health Research and the Institute for Work & Health. AS is supported by the Canada Research Chair in Population Health Equity. The funders played no role in study design, data collection and analysis, decision to publish, or preparation of the manuscript.

  • Competing interests None declared.

  • Patient consent for publication Not required.

  • Ethics approval Ethics approval was not required, as the study relied on de-identified survey data made available through the German Institute for Economic Research (DIW Berlin).

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

  • Data availability statement Data may be obtained from a third party and are not publicly available. This study relied on de-identified survey data made available through the German Institute for Economic Research (DIW Berlin). Researchers interested in obtaining access to the data must contact and submit proposals to DIW Berlin at the following address: soepmail@diw.de.

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