Almost 2 Million People on Universal Credit Left Without Work Support as Numbers Surge Post-Pandemic

Table of Contents

New data reveals that nearly 1.8 million people on Universal Credit are receiving no assistance in finding employment, highlighting a major flaw in the current welfare system.

The number of individuals categorized under Limited Capability for Work Related Activity (LCWRA) which excludes them from work-related support has nearly quadrupled since the pandemic, soaring from 360,000 to 1.8 million in just under five years.

A Sharp Increase in Economic Inactivity

The surge in LCWRA cases is particularly alarming among young people aged 16 to 24, where numbers have jumped 249%, from 46,000 to 160,000 since the pandemic.

This trend suggests that more young individuals are becoming stuck in long-term inactivity, with close to one million not in education, employment, or training.

The Department for Work and Pensions acknowledges that the Work Capability Assessment (WCA), the system used to determine eligibility for work-related support is fundamentally flawed. Under the current structure, people are placed into binary categories: either “fit for work” or “not fit for work.”

Those deemed unable to work are classified under LCWRA, meaning they lose access to employment support indefinitely and are effectively sidelined from the workforce.

Government’s Plan for Welfare Reform

With the UK still experiencing higher economic inactivity levels than before the pandemic, unlike any other G7 country the government is rolling out major employment and welfare reforms. Liz Kendall, the Secretary of State for Work and Pensions, is set to announce radical changes to create a more inclusive labor market and help more people re-enter the workforce.

The government’s Plan for Change aims to:

Overhaul Jobcentres to provide better employment support
Empower local mayors to address economic inactivity in their regions
Introduce a Youth Guarantee, ensuring every young person is either working or in education
Reform or replace the Work Capability Assessment, to prevent it from pushing people into long-term benefit dependency

Financial Incentives and the Welfare System’s Challenges

Currently, individuals on Universal Credit aged 25 and over receive a standard rate of £393.45 per month, while those with health conditions classified under LCWRA get an additional £416.19.

Critics argue this system unintentionally incentivizes people to claim they cannot work, leading to a welfare trap where individuals receive no further employment assistance.

Over the last five years, 67% of Universal Credit recipients who underwent a Work Capability Assessment were categorized as LCWRA—suggesting that many individuals feel pressured to prove they are unable to work to secure higher financial support.

Investing in Health and Employment Support

To combat health-related economic inactivity, the government is investing £26 billion into the NHS, adding 2 million extra medical appointments to address long waiting lists and hiring 8,500 additional mental health workers. These measures aim to help people maintain their health and remain in work.

Additionally, a £250 million investment has been allocated to employment initiatives, including the redeployment of 1,000 Work Coaches to provide intensive job support for around 65,000 sick and disabled individuals.

The Road Ahead

While some increase in LCWRA cases was expected due to the transition from legacy benefits to Universal Credit, the rise has far exceeded projections. Shockingly, 70% of the increase in cases over the last five years was not anticipated by the Department for Work and Pensions.

As the government prepares to reshape welfare policies, the focus remains on breaking the cycle of inactivity, restoring fairness to the welfare system, and ensuring that those who want to work have the opportunity to do so.