Where are the workers?

Think tank: Centre for Policy Studies

Author(s): Karl Williams

March 14, 2023

This report from UK think tank the Centre for Policy Studies presents a new diagnosis of inactivity in the UK.

Economic inactivity has become a huge issue in politics – and is expected to be a key area of focus in this week’s Budget. But many of the most common claims about inactivity turn out to be mistaken, or capture only part of a more complex picture. ‘Where are the Workers? A new diagnosis of inactivity in the UK’ by CPS Senior Researcher Karl Williams examines the rise in inactivity post-pandemic. He finds that the largest number of inactive workers are aged 50-64 – but shows that this is probably driven more by early retirement than ill health. However, he also shows how changes to disability benefits have increased inactivity; an alarming rise in inactivity among those aged 18-24, in particular due to mental health issues; and a very significant gender imbalance among those no longer looking for work. While many have linked the rise in long-term sickness to the NHS’ ability to cope with demand, 77.3% of those economically inactive due to long-term sickness did not want a job and 69% who were newly classified as long-term sick were already out of the labour market for another reason. The rise in economic inactivity due to long-term sickness also began prior to the pandemic, with figures tracking up since the start of 2019.