To boost employment, government should focus on those with ill health who want to move from sickness to salary – new JRF research

• 2.2m working age adults are out of paid work with ill health but want to work or expect to work in the future.
• Budget should prioritise redesigning support for this group as almost one in four (38%) working age adults with ill health are living in poverty, approaching twice the rate for all working age adults (20%).  
• Critical to increasing participation in future is addressing the substantial increase in long term ill-health – up from 11.8m working age adults in 2015 to nearly 15m in 2022.
• Long term illness among those aged 16 to 24 is up from 18% to 27% in the same period.

New research by JRF highlights the huge increase in long term ill-health for working age adults in the UK, which it suggests is the main contributor to worrying levels of non-participation in the labour market.   

Policy concentrating on reducing the number of early retirees by tempting them back to work looks set to fail, as this research shows they are wealthy and settled in their choice. JRF analysis shows that almost all (92%) say they have no desire or expectation to return to work, with 60% stating that they had net household wealth of over £1million. 

Instead, to deliver high participation in work and a more inclusive labour market, attention at next week’s Budget and beyond should be focused on those with ill-health outside of the labour market.

First, because almost four in ten (38%) working-age adults outside of the labour market with ill-health are living in poverty, approaching twice the rate for all working age adults (20%). Helping more of this group move into good work would improve their living standards.

Second, because the potential for many in this group to enter employment is large. Almost half (46%) of working-age adults with ill-health not-participating in the labour market would like to work or expect to work at some point in the future. That’s 2.2 million people.

While some people are unable to work due to a health condition or disability, for every person in ill-health not in work two are in employment, showing that it is misguided to be complacent about the possibility of more of this group entering employment.  

The report notes that this isn’t simply a post-pandemic problem, and instead is a longer term shift that policy makers need to reckon with. More than a third (36%) of working age adults living with one or more conditions, up from 29% in 2015.  

This is not just about rising physical ill-health, but increasing numbers of adults with mental health problems, which accounts for a third (34%) of the rise in number of conditions reported between 2019 and 2022. 

Joseph Elliott, Analysis Manager at the Joseph Rowntree Foundation said:

“Good work can provide a reliable route out of poverty for people and their families, but for too many people these jobs are out of reach. People being locked out of the labour market is a serious issue that needs focused action but honing in on wealthy early retirees is barking up the wrong tree when it comes to dealing with the shortage of labour – it overlooks the group who want to work and who can and should be supported.

“In the interests of our economy and also doing right by people who want to work but are unfairly locked out of employment, it is high time that we took people from check-ups to pay cheques and found the right mix of policies to help the millions of people with health problems who want to work to gain a foothold in the jobs market. If the government is looking seriously at solutions to this issue then this could make a huge difference to people and their families as well as helping to fill the gaps in our labour market.

“While many people with ill health are very active in supporting their families and communities, many also want to work and it is right to ensure that they are not unfairly excluded. An approach built around support and empowerment rather than compliance and fear would also aim to increase the number of people currently classified as ‘economically inactive’ who see paid work as possible and desirable for them”.

Rates of ill-health have substantially increased since 2015, with greatest increases among younger adults:

Proportion of working-age adults with a physical or mental health condition lasting or expected to last 12 months or more, UK

Note: ‘Long-term ill-health’ refers to those who report having a physical or mental health condition or illness lasting or expected to last 12 months or more.

Source: JRF analysis of the Labour Force Survey.

JRF is calling for a new strategy to achieve a high participation, high inclusion labour market which should:

• support employers to redesign jobs to accommodate workers with a range of conditions and to embed flexible working as the default
• ensure timely access to health and social care services (and for these services to recognise the health benefits of good work)
• establish a more active and supportive system of sickness management to increase job retention
• address the way social security – and its assessment processes – undermine the goal of labour market participation (including the dominant focus on gateways and compliance, rather than identifying and providing support)
• shift the focus, resourcing and design of employment support so that it prioritises and works better for those with a long-term condition or disability.

ENDS

Notes to Editors

1. JRF is not using the term ‘economic inactivity’ for the group of working age adults who are not in paid work, given it suggests that many of those who are not active in the labour market specifically are not otherwise engaged in a range of other equally worthwhile activities that sustain family, community or economic life.
2. The two big groups of people in the UK facing barriers to labour market participation are those out of work primarily because they have ill-health or a disability (2.7 million people) and those who are looking after their family or home (1.7 million). The latter group has been declining overtime, down from 2.4 million in 2011.
3. Net household wealth for pensioners includes all financial, property, physical and pension wealth net of debts. Source is JRF analysis of the Wealth and Assets Survey 2018-20.