During an ongoing public health crisis, an additional 26,000 individuals have been forced out of the workforce in the past three months due to long-term sickness, further exacerbating the economic impact of the nation’s health challenges.
The latest data from the ONS reveals that a staggering 2.58 million people are now unable to work due to chronic illness as of April-June 2023. This number has surged by 449,000 since the onset of the pandemic in January-March 2020 when the figure stood at 2.13 million.
Brett Hill, Head of Health & Protection at renowned independent consultancy Broadstone, underlines the critical role of chronic illness-related economic inactivity in the UK’s ongoing productivity puzzle. Hill remarks, “The toll of long-term sickness on economic inactivity continues to be a crucial factor in the UK’s productivity woes.”
He goes on to express his concerns about the significant number of individuals who have been pushed out of the workforce due to health issues during the pandemic. The ongoing crisis in the National Health Service (NHS) continues to cast a shadow over the economy. Hill suggests that despite the government’s promises to address waiting lists, little progress has been made, leaving workers struggling to access essential diagnoses and treatment to maintain their health.
Government efforts remain insufficient
Hill also acknowledges the recent government consultation aimed at expanding Occupational Health services to keep workers healthy and reduce sickness-related work absences. However, he believes that the government’s efforts remain insufficient, urging greater incentives for employers to ensure employee access to healthcare.
“The government needs to be more proactive in encouraging employers to invest comprehensively in healthcare options that ensure their employees’ well-being and continued presence in the workforce as we battle our national health crisis,” Hill emphasises.
Kate Shoesmith, deputy chief executive of the Recruitment and Employment Confederation (REC), notes that long-term sickness is compounding the ongoing skills shortage. She highlights the interconnected nature of the issues highlighted in the Office for National Statistics’ (ONS) report. Shoesmith expresses particular concern over the record-high levels of economic inactivity due to illness. This issue has created significant hurdles in recruiting and retaining personnel in the health and care sectors, demanding a fundamental reassessment of work models, both within the NHS and beyond.
Wage increases
Meanwhile, wage increases have registered a notable upturn, growing by an average of 7.8 percent between April and June 2023 compared to the previous year, marking the highest growth rate since data collection began in 2001. The annual increase in average total pay (including bonuses) reached 8.2 percent, a figure influenced by one-off NHS bonus payments made in June 2023. However, adjusting for current high inflation levels, pay excluding bonuses merely saw a 0.1 percent rise.
Jon Boys, senior labour market economist for the Chartered Institute of Personnel and Development (CIPD), underscores the importance of pay keeping pace with inflation to alleviate the burgeoning cost of living crisis. He acknowledges the positive note of pay growth but warns that consistent high nominal pay increases might lead to concerns of a wage-price spiral, urging vigilance from institutions such as the Bank of England.
As the nation navigates the intertwined challenges of health, workforce dynamics, and economic recovery, stakeholders are urged to collaborate in finding comprehensive solutions that address the multifaceted issues at hand.
Amelia Brand is the Editor for HRreview, and host of the HR in Review podcast series. With a Master’s degree in Legal and Political Theory, her particular interests within HR include employment law, DE&I, and wellbeing within the workplace. Prior to working with HRreview, Amelia was Sub-Editor of a magazine, and Editor of the Environmental Justice Project at University College London, writing and overseeing articles into UCL’s weekly newsletter. Her previous academic work has focused on philosophy, politics and law, with a special focus on how artificial intelligence will feature in the future.
