Britain is going through the longest sustained rise in the number of working-age adults who are too sick to work since the 1990s, according to a report warning that a benefits crackdown is unlikely to solve the country’s jobless crisis.
The Resolution Foundation said economic inactivity due to long-term sickness – when people aged 16-64 are neither in work nor looking for a job because of a health condition – had increased in each year since July 2019, the longest sustained rise since 1994 to 1998.
The thinktank warned that a near-record 2.7 million working-age adults were too sick to work, with the biggest increase since the Covid pandemic concentrated among the UK’s youngest and oldest workers.
Highlighting the legacy of the pandemic as the British economy struggles with chronic workforce shortages, it said the UK was the only G7 country with a lower rate of employment than before the health emergency.
However, the report showed the upward trend in long-term sickness had started before the pandemic struck in the summer of 2019, and had lasted for 54 months. The longest previous period was for 55 months, between 1994 and 1998.
It comes as Rishi Sunak comes under growing pressure from within Conservative ranks to “get a grip on worklessness” after a dramatic increase in economic inactivity over the past four years to more than 9 million people.
People with long-term sickness do not contribute to the official unemployment rate, which has fallen to 3.9% among those aged 16 years and over – equivalent to 1.4 million people – among the lowest levels since the mid-1970s.
However, economic inactivity has increased from 20.5% of all working-age adults to 21.8% – equivalent to 700,000 people – with little sign of slowing as the impact of the Covid pandemic on the jobs market recedes.
Labour and the Conservatives have promised a tough stance on benefit claimants. Earlier this month the shadow work and pensions secretary, Liz Kendall, said there would be “no option of a life on benefits” under a future Labour government as she outlined plans to support young people to find work or training.
The government announced a crackdown on welfare claimants who “refuse” to engage with their jobcentre at the autumn statement, while Mel Stride, the work and pensions secretary, was criticised this week for claiming that the UK’s approach to mental health was in danger of having “gone too far”.
However, the Resolution Foundation report said policymakers should be “wary about having an increasingly strict unemployment benefits system”, since this was possibly acting to encourage more people to claim health-related benefits instead.
Spending on disability benefits is expected to rise by £16.1bn over the next five years to £52.2bn by 2028-29, a rise of 45%, according to the Office for Budget Responsibility.
Louise Murphy, a senior economist at the Resolution Foundation, said the impact on young and old adults could have “serious effects both on individuals’ living standards and career paths, as well as wider strains on the NHS and welfare spending if we fail to improve the nation’s health and reduce economic inactivity”.
“Britain’s labour market is finally returning to normal, but the Covid-19 pandemic has left an alarming legacy of the longest sustained rise in sickness-related inactivity since the 1990s,” she added.
A Department for Work and Pensions spokesperson said: “We’ve reduced the number of workless households by 1 million since 2010. Our £2.5bn back to work plan will help break down barriers to work for over a million more people and our recent budget measures are estimated to boost the labour force by an extra 300,000 workers.”
