People leaving the workforce due to long-term illness at its highest point in the UK

The report by the Resolution Foundation indicates a troubling trend: the number of people leaving the workforce due to long-term illness has reached its highest point since the 1990s. This concerning development is reflected in the statistics – the number of adults classified as economically inactive due to ill health has ballooned from 2.1 million in July 2019 to a staggering peak of 2.8 million in October 2023. This marks the “longest sustained rise” since record-keeping began in 1994-1998.

The government has acknowledged the issue and claims that recent Budget measures will act as a catalyst, boosting the labor force by an estimated 300,000 workers. However, this assertion comes amidst a backdrop painted by the ONS, which revealed that more than a fifth of UK adults are currently not actively seeking employment.

The Resolution Foundation’s report delves deeper, highlighting that people at both ends of the age spectrum – younger and older demographics – are disproportionately affected by long-term illness and subsequent joblessness. Louise Murphy, a senior economist at the Foundation, emphasizes the severity of the situation, stating, “Younger and older people together account for nine-tenths of the rise in overall economic inactivity, which could have serious effects both on individual’s living standards and career paths.”

This rise in long-term sickness has significant ramifications, placing the UK as the sole G7 economy that hasn’t recovered its pre-pandemic employment rate, according to the Foundation. However, a glimmer of hope emerges – the report acknowledges that inactivity figures did see a slight decline to 2.7 million in December 2023.

Intriguingly, the upward trend in long-term sickness predates the pandemic, having begun in the summer of 2019. This trend has persisted for a significant period, stretching over 54 months. The longest prior stretch of increasing economic inactivity due to ill-health was observed between 1994 and 1998, lasting for 55 months.

The Foundation’s analysis extends beyond the ONS figures. They examined data from the Department of Work and Pensions (DWP) that sheds light on disability benefit claims. The report highlights a particularly “striking” rise in claims for PIP, a non-means tested benefit for individuals with health issues. These claims have skyrocketed by 68% between 2020 and 2024. For the 16-17 age group, the increase in new PIP claims is even more dramatic, surging by a staggering 138%.

The Foundation warns of “wider strains on the NHS and welfare spending if we fail to improve the nation’s health and reduce economic inactivity.” The findings reveal that a significant portion of benefit claimants cited mental health issues and musculoskeletal problems as contributing factors. The report states that 69% of claimants reported mental health disorders, while 48% contended with connective or musculoskeletal pain.

Chancellor Jeremy Hunt, in November, addressed the issue of long-term economic inactivity by proposing reforms that include stricter fit-to-work tests and enhanced jobseeker support, aiming to get 200,000 more people into work. He further outlined a £1.3 billion investment over the next five years to assist nearly 700,000 people with health conditions in finding employment.

The most recent report by the Resolution Foundation builds upon their February findings, which indicated that young adults in their early 20s are more likely to be out of work due to ill health compared to those in their early 40s, which is a troubling trend.