400,000 people have left the workforce for health reasons since Covid, report finds

IPPR analysis finds loss of workers equates to £8bn loss in economic output in 2022 alone

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400,000 people have left the workforce since the beginning of the pandemic because of reasons related to poor health, a report by the Institute for Public Policy Research (IPPR) has found.

The report, published to coincide with the launch of the IPPR’s Commission on Health and Prosperity, found that around one million people in total had left the workforce during the pandemic.

This included 200,000 who left because of long-term illness, and around 100,000 who left because of other health reasons, including providing unpaid care.

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The remaining 100,000 left due to reasons such as temporary illness, retiring due to health reasons, and pandemic-related deaths.

According to the report, the combined loss of workers who left the workforce for health reasons equates to an £8bn loss in economic output in 2022 alone.

Overall, the missing million workers who left the workforce during the pandemic led to economic growth 1.2 percentage points lower than expected.

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Chris Thomas, head of the Commission on Health and Prosperity, said that policymakers should take “decisive action”, as well as immediate steps such as “making it easier for people dealing with long Covid and other health complications [to return] to work”.

Those who left the workforce for health reasons made up approximately one third of people lost during the pandemic. The remaining two-thirds left to become students, to provide care, retired, were discouraged workers, or left for other reasons including migration.  

According to the report, “low health outcomes go hand-in-hand with poor economic opportunities” and regional differences in health outcomes can account for the difference in productivity levels.

It found that if rates of unemployment amongst the unhealthiest 50 per cent of local authorities matched the rates of the healthiest 50 per cent, there would be 420,000 more people in work.

The report also estimated that if all local authorities were to match the health outcomes of the 10th percentile local authority, then the UK’s total productivity per hour worked would increase by 1.5 per cent.

The report arrived at its findings by calculating how much a reduced labour force would contribute to economic ‘scarring’ from the pandemic.

It also calculated the difference between what employment and productivity levels would have been if the five-year pre-pandemic trend had continued, and looked at ONS data on labour force inactivity.