Sir Charlie Mayfield says ill-health is driving tens of millions out of labor, costing employers and the financial system billions — however the issue is “not inevitable.”
Britain is vulnerable to an “financial inactivity disaster” because the variety of sick and disabled individuals out of labor continues to rise, based on a government-commissioned evaluation led by Sir Charlie Mayfield, the previous John Lewis chairman.
The report warns that 800,000 extra individuals at the moment are out of labor resulting from well being situations than in 2019, costing employers £85 billion a 12 months in misplaced productiveness, sick pay and employees turnover. With out intervention, an additional 600,000 staff might go away the labour market by 2030.
“This isn’t inevitable,” Sir Charlie stated, as he launched a brand new taskforce aimed toward serving to individuals return to work and tackling what he described as a “vicious cycle” of poor well being and financial inactivity.
The report, commissioned by the Division for Work and Pensions (DWP) however produced independently, discovered that one in 5 working-age individuals is now out of labor and never searching for employment — a significant reversal after a long time of bettering participation.
Sir Charlie stated illness is costing the UK excess of simply enterprise losses.
“Work is usually good for well being, and well being is sweet for work,” he stated. “For employers, illness and employees turnover carry disruption and misplaced expertise. For the nation, it means weaker progress, greater welfare spending and better stress on the NHS.”
Based on some estimates, illness-related inactivity prices the broader financial system £212 billion a 12 months — virtually 70% of annual earnings tax receipts — by way of misplaced output, welfare funds and extra healthcare prices.
The Workplace for Funds Accountability (OBR) expects spending on well being and incapacity advantages for working-age individuals alone to succeed in £72.3 billion by 2029–30.
Mayfield stated the surge was being fuelled by a “sharp rise” in psychological well being situations amongst youthful staff and power musculoskeletal issues — resembling again ache and joint points — amongst older employees.
His taskforce may even work with GPs, who he stated usually face stress from sufferers to challenge sick notes however discover it troublesome to evaluate whether or not somebody might work in a modified function.
Enterprise teams broadly welcomed the taskforce however warned that elements of Labour’s Employment Rights Invoice threat discouraging companies from hiring individuals with present well being situations.
The Invoice contains assured hours and restrictions on zero-hours contracts — measures that some retailers concern will make versatile hiring tougher.
Helen Dickinson, chief govt of the British Retail Consortium, stated retailers have been dedicated to supporting staff with ill-health however that “the federal government’s objectives and insurance policies are at odds with each other.”
“Whereas encouraging employers to put money into workforce well being and supply flexibility, they threat making it harder,” she stated.
In response to the report, the federal government introduced a partnership with over 60 main employers, together with Tesco, Google UK, Nando’s and John Lewis, to check new well being and wellbeing initiatives aimed toward decreasing illness absence and bettering return-to-work charges.
Over the subsequent three years, these programmes will type the premise for a voluntary nationwide office well being commonplace, anticipated by 2029.
Work and Pensions Secretary Pat McFadden stated the partnership was “a win-win for workers and employers.”
“That is about maintaining good, skilled employees in work and supporting individuals to remain wholesome for longer,” he stated.
Ruth Curtice, chief govt of the Decision Basis, stated the evaluation “precisely recognized a tradition of concern, a dearth of assist and structural limitations to work” as key points behind Britain’s worsening inactivity price.
The CIPD, representing HR professionals, welcomed the concentrate on prevention. Its chief govt, Peter Cheese, stated the report’s success “will rely upon how nicely its suggestions are understood by enterprise and backed by nationwide and regional policymakers.”
Dr Roman Raczka, president of the British Psychological Society, stated the shift towards “rehumanising the office” was overdue, however warned that not everybody might or ought to return to work.
“The office itself could be a root explanation for poor psychological well being,” he stated. “These signed off sick deserve well timed entry to secure, compassionate care.”
