Britain Faces Mounting Economic Crisis as Sickness-Driven Inactivity Surges, Warns Former John Lewis Boss
Key Takeaways:
- Rising sickness is becoming an economic threat — With 800,000 more people out of work due to ill health since 2019 and annual employer costs hitting £85bn, the UK faces a growing inactivity crisis that risks long-term damage to growth and productivity.
- Workplace health must become a shared responsibility — Sir Charlie Mayfield’s review stresses that employers, employees, GPs, and health services must work together to support adjustments, improve return-to-work rates, and prevent avoidable long-term absence.
- Government reforms need employer alignment — While businesses welcome efforts to keep people in work, many warn that proposals in the Employment Rights Bill could unintentionally reduce flexibility, highlighting the need for coordinated, practical policy solutions.
The UK is “sliding into an economic crisis” driven by rising sickness and long-term health conditions, according to a landmark review from former John Lewis chairman Sir Charlie Mayfield. The report, commissioned by the Department for Work and Pensions (DWP) but conducted independently, warns that illness-related inactivity has grown sharply since 2019, pulling hundreds of thousands of people out of the workforce and costing the economy billions.
With unemployment inching upward and economic growth stagnating, Britain is grappling with the most severe rise in health-related inactivity in modern history. The findings have ignited urgent debates among policymakers, employers, and health experts over how to reverse the trend — and whether current government policy is helping or hindering efforts to keep people in work.
A Workforce Hit Hard by Rising Illness
According to the report, 800,000 more people are now out of work due to sickness than before the pandemic. This surge reflects a combination of worsening mental health among younger adults and an increase in musculoskeletal conditions — such as back pain, joint issues, and chronic fatigue — among older workers.
Sir Charlie Mayfield described the situation as a “major and accelerating threat” to the UK’s prosperity. Employers face an estimated £85bn in losses every year, stemming from:
Reduced productivity
Higher rates of absenteeism
Increased sick pay obligations
Disruption from frequent staff turnover
The broader UK economy absorbs an even steeper blow. When factoring in lost output, increased welfare spending, and additional pressure on the NHS, sickness-related inactivity is estimated to cost £212bn annually — nearly 70% of all income tax revenue.
The Office for Budget Responsibility (OBR) expects the cost of health and disability benefits for working-age adults alone to rise to £72.3bn by 2029–2030, raising concerns about the sustainability of the welfare system if current trends continue.
One in Five Adults Out of Work — and Not Looking
Perhaps the most worrying finding is the scale of economic inactivity among working-age adults. The report notes that one in five people of working age are neither working nor seeking work, placing the UK among the advanced economies with the highest inactivity rates.
Without urgent intervention, another 600,000 people may leave work due to health conditions by 2030, deepening labour shortages and further undermining productivity.
Sir Charlie emphasised that this outcome is not inevitable: “Work is good for health, and health is good for work. But employers and health services must take a shared responsibility for helping people stay in their jobs.”
Young People’s Mental Health and Older Workers’ Pain Driving the Trend
The report identifies two clear trends:
Younger people, especially under-35s, are facing unprecedented levels of mental health challenges, including anxiety, depression, and burnout severe enough to prevent them from sustaining work.
Older workers are leaving the workforce due to chronic pain, mobility issues, and long-term musculoskeletal conditions — often with little early support or intervention from employers or healthcare providers.
These two forces together represent a generational split in how health is reshaping the labour market. For younger adults, the issue is often psychological distress exacerbated by social pressures and uncertain economic futures. For older adults, the barrier is physical decline combined with working environments that fail to accommodate age-related needs.
GPs Caught in the Middle
One of the more striking findings relates to the role of GPs. Many say they feel ill-equipped to determine whether a patient is truly unable to work — yet are regularly pressured into issuing sick notes due to:
Lack of time
Limited access to patient history
Absence of workplace context
Little guidance on fitness-for-work assessment
Sir Charlie’s taskforce intends to work directly with GPs to create clearer pathways and better support. Without this, he warns, the cycle of sickness certification will continue to deepen the crisis.
Employers Divided: Supportive in Principle, Worried in Practice
The report has been welcomed by major employers, with over 60 companies — including Tesco, Google UK, Nando’s, and John Lewis — agreeing to partner in a three-year initiative to trial and refine workplace health strategies. The aim is to:
Reduce sickness absence
Improve return-to-work rates
Increase disability employment
Establish a certified workplace health standard by 2029
These businesses say they understand the need for inclusive workplaces but want clear, consistent guidance on how best to implement adjustments.
Yet not all employers are convinced
While many back the initiative, some business groups argue that the government’s Employment Rights Bill (ERB) may unintentionally discourage firms from hiring people with existing health concerns.
The ERB, which introduces:
A right to guaranteed hours
Restrictions on zero-hour contracts
Stronger employee protections
is seen by some employers as reducing flexibility at a time when they need more, not less.
Helen Dickinson, chief executive of the British Retail Consortium, said that while retailers support healthier workplaces, the ERB risks undermining the very flexibility that enables companies to hire workers with fluctuating health conditions.
“In its current form, the bill would make it harder for retailers to continue offering many of the flexible roles that help people stay connected to the workforce,” she warned.
A Government Trying to Find a Balance
The government insists it is committed to reducing sickness-related inactivity, and ministers say the Mayfield report is central to this mission.
Work and Pensions Secretary Pat McFadden called the findings a “win-win” for both employers and staff:
“Most people want to stay in work if they possibly can. Keeping people connected to work benefits individuals, businesses, and the wider economy.”
The government’s broader strategy includes:
A national return-to-work programme
Partnerships with major employers
A push to modernise workplace health standards
A controversial plan to guarantee paid work to unemployed young people who have been out of a job for 18 months
Under that youth employment rule, individuals who refuse suitable work could face benefit sanctions — a policy that has been criticised by some youth organisations but defended as a way to prevent “a lost generation.”
The Human Impact: Real People Caught in the System
The report highlights not just statistics, but stories. One of them is Loz Sandom, a 28-year-old graduate with both mental and physical health conditions, who has been unable to find work for a year.
“I want to work,” they said. “I’m willing to do the work. I just need an employer who understands the adjustments I need.”
Loz’s experience underscores a wider problem: many employers do not realise they are legally required to provide reasonable adjustments for disabled applicants and staff. This can include:
Flexible work hours
Remote working options
Ergonomic equipment
Adjusted workloads
Extra time for tasks
Mental health support
“It’s such a shame,” Loz added. “Employers miss out on so many talented disabled people. And they need support too, not just workers.”
This viewpoint — that workplaces must be supported in order to support employees — echoes throughout Mayfield’s report.
Experts Welcome the Review but Urge Caution
The Reaction across professional bodies has been mixed but broadly supportive.
Resolution Foundation
Chief executive Ruth Curtice said the review correctly identifies:
A “culture of fear” around sickness
Lack of employer guidance
Structural barriers such as poor health services and unaffordable childcare
These, she said, are “key challenges to overcome to turn the tide of economic inactivity.”
CIPD (Chartered Institute of Personnel and Development)
The UK body for HR professionals welcomed the preventative approach but noted the recommendations will only work if:
Businesses understand how to implement them
Policymakers provide consistent national-level support
British Psychological Society
President Dr Roman Raczka praised the move toward “re-humanising the workplace” but issued a warning:
“Not everyone is well enough to return to work. The workplace can itself be a cause of poor mental health. Those who are too sick to work deserve compassionate care, not pressure.”
His comments highlight a central tension in the debate: promoting employment while protecting those genuinely unable to work.
An Uncertain Road Ahead
The UK now faces a defining labour market challenge. With hundreds of thousands leaving work due to health problems — and many more at risk — the country must adapt or face long-term economic decline.
Sir Charlie Mayfield insists that decline is not inevitable. His proposed solution relies on:
Better cooperation between employers, employees, and the NHS
Clearer guidance for GPs
Improved workplace adjustments
Major employer partnerships
A shift from reactive to preventive healthcare
Removing stigma from discussions of workplace illness
Whether the UK can achieve these changes will determine whether economic inactivity continues to climb — or whether the country can turn a looming crisis into an opportunity to modernise its labour market.
Conclusion
Britain is at a crossroads. With billions lost annually and one in five working-age adults inactive, health-related absence is increasingly recognised not merely as a welfare issue, but as a direct threat to national prosperity.
The Mayfield report offers a blueprint for reversing this trajectory, but success will depend on political will, employer cooperation, and a shift toward healthier, more inclusive workplaces. Without action, the UK risks entrenching a cycle of ill health, low productivity, and shrinking labour supply.
But with coordinated national effort, Sir Charlie argues, Britain can “reclaim the connection between work and wellbeing” — and rebuild a stronger, more resilient economy.
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