The UK labour market has lost more than 1.1 million workers since the pandemic began, around 400,000 of whom have left due to long-term ill health and Covid-related factors, according to a think tank.
The Institute of Public Policy Research’s (IPPR) Health and prosperity report estimates that the UK labour market changes will result in an £8 billion fall in economic output in 2022 alone.
It suggests that correcting the UK’s “failures” on population health could help alleviate the economic challenges facing the UK, including low growth, low productivity, labour market losses and wider inequality.
It says there has been a “massive” rise in unmet physical and mental health needs over the course of the pandemic, with treatment of many conditions keeping people out of work being delayed by record NHS waiting lists.
Long-term illness has driven the loss of around 200,000 people from the labour force, and other pandemic factors – including people who have dropped out of work for no specific reason – has resulted in a further 200,000 departing from the labour market.
The report estimates that around a third of the workers lost during the pandemic dropped out because of their health.
UK labour market changes
Pandemic shifted labour market to low-skill, low pay
The think tank has formed a group of health, economic and equality experts – the ‘Health and Prosperity Commission’ – to explore how people can enjoy living healthy lives longer and to “heal the nation’s fractures and anaemic economy”.
Members include Matthew Taylor, CEO of the NHS Confederation and former head of the Number 10 policy unit; Andy Burnham, Mayor of Greater Manchester and former health secretary; Simon Wren-Lewis, professor of economics and the University of Oxford; and Christina McAnea, general secretary of union Unison.
Scars of pandemic still deep
Commission co-chair Dame Sally Davies said: “While the restrictions have eased, the scars of the pandemic still remain deep on the nation’s health and our economy. Not only are we facing a severe cost of living crisis, driven in part by pandemic induced inflation, we’re also experiencing a workforce shortage driven by poor health that’s holding back the economy.
“It has never been more important to put good health at the heart of our society and economy – and our commission will bring forward a plan to do just that.”
Chris Thomas, head of the commission, said: “As the government moves to a ‘living with Covid’ strategy, politicians must not forget how intrinsically linked our health is to our economic fortunes.
Policymakers can take immediate steps to make it easier for people dealing with long Covid and other health complications back to work” – Chris Thomas, Health and Prosperity Commission
“Policymakers can take immediate steps to make it easier for people dealing with long Covid and other health complications back to work, but they must also take decisive action to improve our health overall and tackle our nation’s burning health and economic inequalities. An unthinking return to the status quo would be a grotesque injustice to all who have lost their lives and livelihoods. We must build back better.”
The report claims there are stark regional health and wealth inequalities. For example, someone in Richmond upon Thames can expect to have an average household income of £42,000 per year and can expect to live 70 years without major illness. By contrast, the average person in Nottingham can only expect to have an income of £13,000 per year and live 56 years without major illness.
If health standards in all local authorities were brought at least in line with the healthiest 10% of places, it says the UK would see gross value added per hour worked increase by 1.5%, or 46 pence per hour, by each worker on average.
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It notes that in the 1960s Japan was the least healthy G7 nation, but is now the healthiest. If the UK met the health outcomes of Japan, people would stay in good health for four additional years on average and the UK’s overall productivity could increase by 1.2%.
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