Impact of austerity and recession on homelessness across 323 local authorities in England

Background: There has been a significant rise in the rates of people seeking homelessness assistance from local authorities in England since 2010, albeit to varying degrees across local areas and over time. Although previous studies have quantitatively analysed the importance of socio-demographic factors and housing market conditions, the impacts of economic downturn and austerity on homelessness are not well understood. Methods: Using cross-area fixed effects models, we tested the impact of economic downturns and types of welfare spending on changes in statutory homelessness rates across 323 UK local authorities covering years 2004-2012. Results: We estimated that each 10% fall in Gross Value Added per capita was associated with an increase of 0.45 homelessness claims per 1,000 households (95% CI: 0.10-0.80). Central and local government reductions in welfare spending were also strongly linked with increasing rates of homelessness. Disaggregating types of welfare expenditure, we found that the strongest areas for preventing homelessness were linked to spending on social care, housing services, discretionary housing payments, pension credits and disability support for older persons. Conclusions: The combination of recession and austerity measures has significantly increased rates of persons seeking assistance for homelessness in England. These findings likely understate the full burden of homelessness associated with recent economic declines and austerity measures as they only capture those who seek aid. Future research is needed to investigate what has happened to persons who do not interface with homelessness support, particularly focusing on vulnerable groups with mental health problems and on rough sleepers.