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The UK is facing an “economic inactivity crisis” as employers are losing an estimated £85bn a year in costs linked to sickness and poor workplace health, a landmark report has found.
More than one in five working-age people are now out of work and not looking for work – more than comparator countries – which is costing the UK £212bn a year, the Mayfield review said.
Its author, former John Lewis boss Sir Charlie Mayfield, says poor health “has become one of the biggest brakes on growth and opportunity,” but says it is not inevitable.
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The report, published on Wednesday, says there are now 800,000 more people out of work now than in 2019 due to health problems, and without “decisive action” to address this, another 600,000 people will be added by 2030.
Sir Charlie found that a 22-year-old who is not in work for health reasons could be more than £1 million worse off over their lifetime, while employers are losing an average of £120 per day in profit from absences.
The cost to the state is also vast – it is costing 7% of GDP, or almost 70% of the income tax we pay, through “lost output, increased welfare payments and additional burdens on the NHS”, which is “unsustainable”.
The additional burden in welfare payments and NHS demand is around £47bn annually, the report says.
Among the reasons for these absences continuing to mount is a “culture of fear” felt by both employers and employees, that “creates distance” and “discourages safe and early disclosure, constructive conversations and support,” Sir Charlie found.
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