Yahoo Finance Employment support needs to be a ‘top priority’ as long-term sickness hits new record
The UK’s long-term sickness crisis, which is contributing to a spiralling welfare bill and sluggish growth, will be near the top of the next government’s in-tray.
New figures out today showed that 9.4m people were economically inactive in the three months to April, up nearly 400,000 on last year, with long-term sickness a major contributor.
Although there are some question marks over the quality of the data, the figures showed that just over 2.8m people were out of work due to long-term sickness, up from around 2m pre-pandemic.
If the UK’s employment rate remained at its pre-pandemic level, the Resolution Foundation estimated that the workforce would be around 1m workers bigger.
“Turning around this poor performance, and kickstarting the kind of jobs growth Britain experienced in the 2010s will be a key task for the next government,” Nye Cominetti, principal economist at the Resolution Foundation, said.
Tony Wilson, director of the Institute for Employment Studies, said the UK has suffered from the largest contraction in its workforce since comparable records began back in 1971.
“This just isn’t happening in other countries, with the UK virtually the only developed economy where the employment rate has fallen since the Covid-19 pandemic,” he said.
“Reforming employment support needs to be a top priority for the next Parliament, so that more people can get access to the help that they need to get back into work and get on in work,” Wilson added.
The Conservatives claim that providing benefits for people who are out of work could cost around £90bn by the end of the next parliament. They hope to cut the welfare bill by £12bn, through a carrot-and-stick approach to getting people back into work.
The Conservatives will expand access to talking therapies by around 500,000 while also tightening the criteria on who is able to receive the main disability benefit, particularly targeting those with ‘minor’ mental health issues.
Mental health is a major reason why many young people are out of work. ONS research from last year suggested that over half of those out of work due to long-term sickness had at least one mental health condition.
But Christopher Rocks, lead economist and head of secretariat at the Health Foundation said the government should “rethink” plans to reduce the generosity of benefits. These would risk “increasing poverty and further deteriorating health,” he warned.
Labour meanwhile have pledged to increase the employment rate to 80 per cent, equivalent to over 2m extra workers.
Liz Kendall, shadow work and pensions secretary, said Labour will introduce a new national jobs and careers service to help match people to jobs while also cutting NHS waiting lists.
