New research shows that UK families lose nearly a fifth of income after job loss

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The study, led by the Department of Social Policy and Intervention (DSPI) and published in Socio-Economic Review, found that UK households see their income slashed by 17% in the first year after job loss - a far sharper hit than in Nordic or continental countries. This is despite UK households working harder than their European counterparts to fill the gap through taking on extra hours or multiple jobs.

The findings not only reflect poor labour market conditions in the UK but also underscore the need for stronger unemployment support, and at a more ambitious level than those set out in the Government’s initial plan for Unemployment Insurance scheme announced in March 2025. 

'After a job loss, unemployment insurance is crucial in cushioning immediate income losses, while re-employment is most effective solution both in the short- and long-term. Yet the UK is lagging behind when it comes to quality of re-employment and generosity of benefits. [...] A strong unemployment insurance is a crucial tool for reaching a more dynamic labour market where workers can move between jobs, contributing to productivity and growth. While a generous scheme might come with a budget cost, it can help with current government’s priorities on growth.' Dr Selçuk Bedük, Departmental Lecturer in Comparative Social Policy at DSPI

Find out more on the University of Oxford website