Age-old or new-age?

At the start of the Covid-19 crisis, the number of families receiving income from the benefits system increased significantly, with 1.3 million more families receiving Universal Credit within three months – reversing a trend of a steady decline in families receiving benefits. In this briefing note, we examine the shift in the numbers of families receiving benefits during the Covid-19 crisis, in the context of the rollout of UC and move away from legacy benefits. We also examine the generosity of benefits received by age and by generation.

We find that the share of young people receiving benefits increased by two thirds during the crisis, a testament to the extent that young people have been adversely affected by the economic effects of the Covid-19 crisis, more than any other age group. During the recovery from the Covid-19 crisis, more families will be claiming benefits than in previous years, meaning that living standards for families are more dependent on the benefit system. This is especially true for young people now, who have driven the increase in benefit recipients and suffered disproportionately during the Covid-19 economic crisis. Upcoming changes to the benefit system, such as the removal of the £20 a week uplift to Universal Credit, should be considered in light of this.