The lockdown has hurt the economy by undermining children's education, undermining public finances and adding pressure to a health service that is already struggling with an aging population .
But among its most detrimental and long-term effects appears to be a sharp and sustained rise in the number of people of working age who have left the labor market due to ill health.
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In a time of severe skills shortages, as the economy struggles to return to its pre-pandemic size, this represents a loss that the nation can hardly afford, as well as a desperate personal tragedy for those who cannot fulfill their potential.
More than 2 million people are economically inactive – not working or looking for work – due to poor health. This is 350,000 more people than before the pandemic and has dire consequences for the economy of the government's already precarious finances.
Some of the unemployed are among the 1.4 million reported Covid-19 sufferers. . Other conditions have also become more common.
1407 Mental health problems lead to chronic illness
Among those who are not working due to illness, nearly 620,000 cite mental health problems as the cause, making a jump more than a third from just under 460,000 ten years ago.
Advanced diseases such as cancer rose by 17 percent, affecting more than 200,000 people, while heart and musculoskeletal problems declined and reduced the number of workers by 111,000 and 543,000 people, respectively.
< p>The reasons why this happens in the more idle are different.
The pandemic has not only infected millions of people, but also overwhelmed part of the health service, delayed treatment for other diseases and contributed to huge waiting lists – this means that those who are not working for health reasons have to wait longer before they can return to the labor market. . and family members will likely have to spend time caring for them.
The number of people waiting for treatment reached 7.4 million in April, compared to less than 5 million on the eve of the pandemic and less than 3 million in a decade. back.
Poor mental health, in particular, is increasingly common among young people, and is the most common cause of absence from the labor market among unhealthy people under 50.
The benefit system itself may be partly to blame. .
Those who are unemployed, in poor health and claiming benefits have incentives to claim sickness benefit rather than job search benefit.
According to the OBR, there is evidence of “a growing stream of health-related benefits, which may in part reflect the degree of current assessment, conditionality, and return-to-work support for those receiving health-related benefits compared to other non-staff benefits.” . -work allowances, along with the role of a long period of weak growth in household incomes and growing pressure on the cost of living, which increases incentives to receive the old, more generous benefits.
1407 A sharp increase in disability
During the pandemic, almost 100% of those who applied for disability benefits, which pay an average of £10,000 a year, were approved, compared to 81% on the eve of Covid.
Andy King, outgoing member of of the OBR executive team, says applicants should check more carefully what benefits they are eligible to receive.
“The legacy of the healthcare crisis in the midst of a cost-of-living crisis is likely to force people to be very careful about what they are eligible for.” they can qualify under the social security system,” he says.
“Workability assessment and health assessment for disability benefits is an unpleasant experience for those who go through it. So it's not like it's an easy option, but it's obviously a more generous pound benefit than unemployment benefits. So it's unlikely that this hasn't affected some people's choices.”
This, in turn, puts pressure on the public purse.
The benefits account increased by £6.8bn. for this fiscal year for an additional 930,000 people in poor health, nearly half of whom are inactive.
On top of that, those who don't work don't earn money and therefore don't pay taxes, while how unhealthy people who are still working can generally work fewer hours.
1407 Inactivity is declining everywhere except the UK
OBR estimates that forgone income tax, average national insurance contributions and other government revenues are £8.9 billion.
Then come the health care costs.
“We estimate that each person moving health-related inactivity is costing the NHS between £900 and £1,800 a year,” the OBR said. on people's health.”
The longer this goes on, the worse it will get.
Whether the trend continues or can be reversed is of the utmost importance for public finances.
OBR's main outlook is for a modest recovery in labor force participation, helping to reduce borrowing from £130bn this year to just under £50bn. by 2027–2028
A further spiral of ill health pushing an additional 500,000 people out of the workforce over this central projection adds £21.3bn to that annual borrowing. A fall of the same magnitude would save £18.7bn a year.
That's a huge prize for any government that can push the numbers in the right direction.
So, how to reduce the terrible situation?
Prime Minister has made reducing NHS waiting lists one of his top five priorities.
1407 Long waits for treatment
OBR estimated that last year there were 2.9 million working-age adults on waiting lists, of which 1 million were economically inactive, and 650,000 people cited ill health as the reason for their absence from the labor market.
At first glance, this suggests that bypassing waiting lists could help a lot of people get back to work.
However, OBR warns that not all treatments will get people well at night .
“Waiting list turnover is high, but the labor market is not, so from a labor market perspective, “recovery” of someone a few weeks early has only a limited impact on labor market aggregates based on observed turnover rates,” reads the report. OBR.
Reducing the waiting list by more than half, from 7.4 million to 3.5 million, would reduce working-age inactivity by only 25,000 over the next four years, he predicts.
< p>Given waiting lists and, in particular, mental health problems were on the rise even before the pandemic, the solution is not clear.
Returning the long-term sick will be difficult because the affected people were mostly older and poorer. and previously worked in low-skill jobs,” says King.
“To be honest, it’s hard to deal with. The socio-economic gradient of what we see here is concentrated among those who have lower-paying jobs, less secure occupations in rented housing,” he says.
“This is the part of the population that has had problems in this area for a long time, which seem to have worsened due to the pandemic. So all this creates a very complex political issue.”
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