Stress testing the UK welfare system for unemployment

This article examines the resilience (or otherwise) of the United Kingdom social protection system in the face of increasing unemployment. It explores the extent to which benefits protect the household incomes of unemployed people both in relative terms and in comparison with an absolute income threshold. It finds that for the people most likely to become unemployed in the first phase of the current downturn most of any protection they have comes from the earnings of other household, members. In the case of sole-earner households, the benefit system fails to maintain household income above the poverty threshold in most cases and the relative drop in income for this group is very high by international standards.