Values, welfare and work: aspects of the labour market and welfare dependency

Abstract

What is described as long-term welfare dependency is perceived to be a serious problem and was the focus of the terms of reference of the Welfare Working Group (WWG). An examination of the way the labour market works indicates that we can expect some people in the labour market to show exactly the characteristics described as welfare dependency, with long periods of support from the welfare system. From this perspective, much welfare dependency is generated by the economic system, not personal characteristics. Personal characteristics still matter, but they influence who needs welfare, not the total amount needed. Changing incentives, as proposed by the WWG, may not change the situation very much.