Britain’s public finances are being crippled by a steep and sustained rise in the numbers of people of working age who have left the jobs market because of ill health following the pandemic and lockdowns, the Office for Budget Responsibility has warned. The Telegraph has more.
Lockdown wreaked havoc across the economy, devastating children’s education, hammering the public finances and piling pressure on a health service already struggling with the ageing population.
But among its more pernicious and long-term consequences appears to be a steep and sustained rise in the numbers of people of working age who have left the jobs market because of ill health.
At a time of an acute skills shortage, when the economy is struggling to get back above its pre-pandemic size, this represents a loss the nation can scarcely afford – as well as being a desperate personal tragedy for those unable to fulfil their potential.
More than two million people are economically inactive – neither in work nor looking for work – because of ill health. This is an increase of 350,000 compared with pre-pandemic levels, and has dire consequences for the economy and the Government’s already-precarious finances.
Some of those not working are among the 1.4 million claimed sufferers of Long Covid. Other conditions have also become more prevalent.
Among those who are not working because of sickness, almost 620,000 cite mental health problems as the cause, a jump of more than one-third from just under 460,000 a decade ago.
Progressive illnesses such as cancer are up 17%, affecting more than 200,000 people, while heart problems and musculoskeletal conditions have ebbed to take 111,000 and 543,000 out of the workforce respectively.
The reasons this translates into more inactivity are varied.
As well as infecting millions, the pandemic also overwhelmed parts of the health service, delayed treatment for other conditions and contributed to vast waiting lists – meaning those who are out of work for ill health have to wait longer before they can return to the jobs market, and family members are more likely to have to take time out to care for them.
The number awaiting treatment hit 7.4 million in April, up from below five million on the eve of the pandemic and under three million a decade ago.
Poor mental health in particular is increasingly prevalent among the young, and is the most common reason cited by unwell under-50s for their absence from the jobs market.
The benefits system itself may even bear some of the blame.
Those who are out of work, in poor health and claiming benefits are incentivised to claim sickness support instead of jobseekers’ allowance.
Interestingly, on this occasion the rise in economic inactivity appears to be a U.K.-only phenomenon.
The costs of all this additional inactivity are huge. According to the Office for Budget Responsibility, the benefits bill has risen by £6.8bn for this financial year for the extra 930,000 people who are in poor health, almost half of whom are inactive.
The lost tax revenue owing to those off-work or working at lower capacity is estimated to be £8.9bn. On top of that there are the additional healthcare costs for those who are unwell.
The already humungous bill for the disastrous Covid response just keeps getting bigger. Why this rise in economic inactivity is specifically affecting the U.K. needs to be looked into further.
The Telegraph report is worth reading in full.
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