Long-term sickness is costing the UK economy US$53.6 billion a year

Long-term sickness is costing the UK economy £43 billion (US$53.6 billion) a year, or about 2 per cent of gross domestic product, according to a study that adds to pressure for government action.

The Institute for Public Policy Research said each new illness costs people as much as £2,200 (US$2,700) in annual earnings by forcing them to resign or work less.

The findings are the latest to identify health as one of the factors dragging down the UK economy, which the Bank of England says may struggle to produce any growth over the next year in what may be one of the longest slumps on record. Long-term sickness since the pandemic is one of the main reasons people cite for dropping out of the workforce, which uniquely among the Group of Seven nations is smaller than it was when Covid-19 struck.

“Better health is the best medicine for our economic malaise”, Chris Thomas, head of the IPPR’s commission on health and prosperity, said in a statement released on Thursday. “Our economy faces a series of overlapping crises: low productivity, low growth, widening inequality and a historic fall in living standards”.

The London-based think tank found that improvements in health could increase earnings and, by boosting women’s wages twice as much as men’s, narrow the gender pay gap.