Research published by the Centre for Social Justice found roughly 3,000 areas across England and Wales where out-of-work benefit claims account for at least half of the working-age population, with upwards of 150 of those neighbourhoods recording figures that exceed the 80 per cent threshold. A 250-page document titled State of Dependency, released as part of a newly launched welfare inquiry, contained the findings.

According to the CSJ, benefit-dependency data point to deeply rooted patterns of joblessness across numerous localities, with claimant totals in certain areas accounting for more than half of the estimated working-age population. Of the 166 local authority areas where jobseeker claimant figures surpass half the estimated working-age population, Birmingham accounts for the greatest concentration. Ranking second among the cities listed, Liverpool recorded 112, while Sheffield and Bradford posted totals of 82 and 81 respectively.

When the share of affected neighbourhoods is used as the measure, Blackpool tops the list at 15 per cent, with Hartlepool recording 12 per cent and Redcar and Cleveland coming in at 8 per cent. On average, roughly 250 residents make up the population of a single neighbourhood.

Data on out-of-work claimant rates across England's three largest cities point to a wide spread in local labour-market conditions: neighbourhoods where at least four in ten working-age residents claim out-of-work benefits account for around a fifth of all local areas in Liverpool and roughly 18 per cent of those in Birmingham, whereas that same threshold is met by only about two per cent of comparable areas across London.

Across the working-age population, roughly 1.7 million additional benefit recipients have been placed in categories carrying no obligation to look for work or take steps toward employment readiness — a shift that has unfolded over the period stretching back to 2019. The count of people drawing incapacity benefit climbed 61 per cent, placing Britain at odds with comparable nations, while the share of working-age adults recorded as disabled moved up by 16 per cent.

According to the report, people out of work are now more likely to be classified under incapacity categories than traditional unemployment, with poor mental health cited as a leading factor behind that shift. Across the working-age population, the number of people self-reporting a mental health condition has climbed by around 3.2 million since 2012.

Iain Duncan Smith, who previously led the Conservative Party, argued that the data point to unemployment having quietly normalised in British society in the years following the pandemic. He argued that the volume of people outside the workforce in Britain has reached a point that would historically have prompted urgent national action, yet the scale of the problem has gone largely unaddressed because those affected tend to be classified under incapacity rather than standard unemployment measures.

His contention was that people's lives remain affected by a problem that has yet to receive adequate attention, and that welfare reforms he championed — Universal Credit among them — contributed to a reduction in worklessness that reached a pre-pandemic low point. He contended that tackling the economic marginalisation of left-behind communities demands genuine political will, and that withholding steady employment — along with the dignity it provides — from those residents represents a path that is neither compassionate nor sustainable.

According to the document, children in areas of concentrated benefit dependency may reach adulthood having had little day-to-day exposure to people in paid work.

Figures from the Department for Work and Pensions show that close to two million people who hold overseas nationality are drawing state pension payments or other welfare entitlements in the United Kingdom. According to a CSJ review, roughly 1.3 million people without British citizenship draw Universal Credit, among them around 745,000 nationals from European countries who remained in the UK following Brexit.

Between 2019–20 and 2024–25, the number of working-age people recorded as disabled — under a definition broad enough to encompass mental health conditions — grew by 8 million, according to the research. Disability claims lodged by roughly 1.6 million veterans of the First World War — men who had suffered injuries during active service — had accumulated to that total by March 1923.

In a statement to a broadcaster, the Department for Work and Pensions said the data point to unemployment having taken hold across numerous communities over an extended period, with poor health increasingly cited as a contributing factor, leaving what the department described as a welfare system in need of reform when the current administration took office. The department outlined three planks of what it described as welfare reform: narrowing the gap between Universal Credit standard and health rates, returning to face-to-face assessments, and directing £3.5 billion toward employment support — steps it said would move away from a model where claimants are signed off without further engagement.

The statement described employment and opportunity as central priorities within the framework, adding that conclusions from the Timms and Milburn Reviews would provide the groundwork for lasting change.