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The number of sick and disabled people out of work is putting the UK at risk of an “economic inactivity crisis” that threatens the country’s prosperity, according to a new report.
There were 800,000 more people out of work now than in 2019 due to health conditions, costing employers £85bn a year, according to the review by former John Lewis boss Sir Charlie Mayfield.
The problem could worsen without intervention, but Sir Charlie, who will lead a taskforce aimed at helping people return to work, said this was “not inevitable”.
The move has been broadly welcomed, but some business groups said Labour’s Employment Rights Bill included some disincentives to hiring people with existing illnesses.
One in five working-age people was out of work and not seeking work, according to the report, which was commissioned by the Department for Work and Pensions but produced independently.
Without intervention, another 600,000 people could leave work due to health reasons by the end of the decade.
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Work and pensions secretary Pat McFadden said Sir Charlie’s message is ‘crystal clear: keeping people healthy and in work is the right thing to do’ (PA Wire)
Sir Charlie said sickness costs employers £85bn a year through issues including lost productivity and sick pay, but it also costs the broader economy.
He said that “young adults are being hit hard” and added: “The growth in 16- to 34-year-olds with a mental health condition who are economically inactive due to long-term sickness is particularly concerning, having risen by 190,000 (76 per cent) between 2019 and 2024”.
Publishing the document, the ex-retail boss said: “Britain is sliding into an avoidable crisis. Ill-health has become one of the biggest brakes on growth and opportunity. But this is not inevitable.
“Employers are uniquely placed to make a difference, preventing health issues where possible, supporting people when they arise, and helping them return to work. If we keep Britain working, everyone wins – people, employers, and the state.”
He has proposed a new approach where responsibility for health at work is shared between employers, employees and health services rather than being left to the worker and the NHS.
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Mr McFadden during a visit to the Opportunity Hub in Neath (PA Wire)
While Sir Charlie said employers must do more to help their employees, he warned that workers must play their part.
He wrote: “Work can be demanding. Setbacks are part of life. Health and work are not always easy partners, but they are mutually reinforcing.”
The so-called review was officially launched in January and was tasked with examining “spiralling levels of inactivity”, as ministers are looking at how to get people back into work.
Among its recommendations, the review called for the adoption of a workplace health provision, which it described as a non-clinical case management service supporting employees and line managers across a so-called healthy working lifecycle.
It said this approach, offering support and advice and early intervention, could be integrated with the NHS App and reduce or replace the need for the current fit note.
The government said more than 60 employers – including the British Beer and Pub Association, Burger King, John Lewis and Google UK – have expressed interest in becoming so-called vanguard employers to pioneer the overall new approach.
Work and pensions secretary Pat McFadden said Sir Charlie’s message is “crystal clear: keeping people healthy and in work is the right thing to do and is essential for economic growth”.
He added: “Business is our partner in building a productive workforce – because when businesses retain talent and reduce workplace ill health, everyone wins.
“That’s why we’re acting now to launch employer-led vanguards as part of the plan for change, driving economic growth and opportunity across the country.”