Universal credit doing more to get into work, but more likely to borrow to get to end of month

Universal Credit claimants are doing more to get into work than jobseekers claiming under the current system, but are more likely to have had to borrow money to get through the month, according to new figures from the Department for Work and Pensions.

The first research on Universal Credit, following interviews with 2701 benefit claimants in four pilot areas, shows that people claiming Universal Credit reported looking for work for 27.1 hours a week on average, compared to 13.6 hours by a comparable group of Jobseeker’s Allowance claimants. Universal Credit combines six benefits and tax credits into one.

The research shows claimants of the new system apply for more jobs per week, typically submitting 16 applications for work while Jobseeker’s Allowance recipients apply for 11. The DWP says the findings suggest that the stricter jobseeking requirements set out in their Claimant Commitment are encouraging people to look for work. Some 76% of Universal Credit claimants said that knowing their benefits would be reduced or stopped if they did not complete activities agreed with their work coach made them more likely to search for jobs.

There were concerns about people’s ability to budget with Universal Credit which is paid monthly rather than weekly. Over three-quarters (78%) of Universal Credit claimants receiving monthly benefit payments said they felt confident about their ability to budget, but only 37% who previously claimed Jobseeker’s Allowance think being paid monthly is more convenient. Less than one in 10 (8%) have sought advances on their benefit payments.

The research also found 34% of claimants are asking for money from sources such as family and friends or payday lenders to get them through the month, compared to 19% under JSA. Universal credit is currently only in the pilot stages and the pilots only cover those with no dependents.

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