A queue of ambulances outside the emergency department of the Royal London Hospital in London on November 24, 2022. In the UK, the number of “economically inactive” people – those who are neither working nor looking for a job – between the ages of 16 and 64 has increased by more than 630,000 since 2019.
Leon Neal/Getty Images
LONDON – The UK economy is being hammered by a record number of workers reporting long-term illness, sky-high inflation and energy costs as well as a Brexit-related trade tailspin and a slowdown in progress.
The Office for National Statistics reported that between June and August 2022, nearly 2.5 million people cited long-term illness as the main reason for economic inactivity, an increase of nearly half a million since 2019.
The number of people “economically inactive” – those who are neither working nor looking for a job – between the ages of 16 and 64 has increased by more than 630,000 since 2019. Unlike other major economies, recent UK data shows no indication that these lost workers are returning to the labor market, even as inflation and energy costs continue to put enormous pressure on household finances.
The UK avoided massive job losses during the Covid-19 pandemic as the government’s furlough program subsidized businesses to retain workers. But since the lockdown measures were lifted, the country has seen a labor market exodus of a scale unparalleled among advanced economies.
in his last month reportThe ONS said a number of factors could be behind the recent spike, including National Health Service waiting lists which are at a record high, the aging population and the prolonged effects of Covid.
“Young people have also seen the largest relative increases, and some industries such as wholesale and retail have been affected to a greater extent than others,” the ONS said.
While the impact of the issues mentioned above has not been quantified, the report suggested that the increase is driven by “other health problems or disabilities,” “mental illness and neurological disorders” and “problems associated with [the] back or neck.
legacy of austerity
Jonathan Ports, professor of economics and public policy at King’s College London, told CNBC that the scale of the labor market decline is likely a combination of prolonged Covid; other health issues related to the pandemic such as mental illness; and the current crisis in the NHS.
In addition, he said factors that directly hurt public health – such as increased waiting times for treatment – could have an effect: people may have to leave the workforce to care for sick relatives.
“It is worth remembering that the UK has been here before, arguably at least twice. In the early 1990s, Britain saw a rapid recovery after ‘Black Wednesday’, with unemployment falling, but it also had a large And there has also been a steady increase in the number of people claiming disability-related benefits,” Portes said, adding that not working is generally bad for both health and employment.
“The government is clearly not doing much about this. Apart from solving the crisis in the NHS, the other key policy area is support to get sick and disabled people back to work, and not nearly enough is being done at this is – instead the government is harassing people on Universal Credit with penalties and sanctions, which we know doesn’t help much.”
in my condition autumn statementFinance Minister Jeremy Hunt announced The government will ask more than 600,000 people receiving Universal Credit – a means-tested social security payment for low-income or unemployed households – to meet with a “work coach” to set up a plan to increase hours and earnings.
Hunt announced a review of issues preventing re-entry into the job market and committed £280 million ($340.3 million) over the next two years to “crack down on benefit fraud and errors”.
Although the pandemic has greatly worsened the health crisis, leaving a hole in the UK economy, the rise in long-term illness claims actually began in 2019, and economists see several possible reasons why the country has been notably vulnerable.
Portes suggested that the government’s austerity policies – a decade of sweeping public spending cuts implemented after former prime minister David Cameron took office in 2010 and aimed at improving the national debt – were leaving Britain vulnerable. Played an important role.
“The UK was particularly vulnerable due to austerity – NHS waiting lists were growing rapidly, and performance/satisfaction was falling rapidly, well before the pandemic,” Portes said.
“And support for those on disability and disability benefits hollowed out in the early 2010s. Broadly speaking, austerity has led to a sharp gradient in health outcomes by income/class.”
Inequality and Growing Waiting Lists
This is borne out in national statistics: the ONS estimates that between 2018 and 2020, men living in the most deprived areas of England will live an average of 9.7 years less than women living in the least deprived, with a difference of 7.9 years live in the regions.
The ONS noted that both sexes “showed a statistically significant increase in the inequality in life expectancy at birth from 2015 to 2017.”
Following the pandemic, NHS waiting lists grew at their fastest rate since records began in August 2007, a recent House of Commons report highlighted, for consultant-led hospital treatment in England by September There were over 7 million patients on the waiting list. ,
However, reports state that this is not a recent phenomenon, and that the waiting list has been growing rapidly since 2012.
“Before the pandemic, in December 2019, the waiting list stood at over 4.5 million – almost two million more than in December 2012, an increase of 74%,” it said.
“In other words, while waiting list growth has been accelerated by the pandemic, it was also occurring for many years prior to the pandemic.”
Michael Saunders, a former Bank of England policymaker who is now a senior policy advisor at Oxford Economics, also told CNBC that the UK has been particularly hard hit by Covid in terms of severity, and that some of the country’s high Rates may result. Pre-existing health conditions – such as obesity – that may have been exacerbated by Covid.
“The UK is a relatively unequal country, so this may be part of the reason that even if we have the same Covid wave as other countries, we can have a bigger impact on public health, because if you want your Near is more the tail of those who will be most affected by it,” he said.
Saunders suggested Any development strategy from the government Must include measures to address these health care challenges, which are now compounded by rising labor participation rates and the broader economy.
“It’s not just a health issue, it’s an economic issue. It’s important both ways. I think it’s important enough as a health issue, but it merits additional importance because of the impact on potential production.” Which feeds through these other economic problems.”