An expert group has been founded to advise the Labour government on tackling the issue of hundreds of thousands of people leaving the workplace due to long-term sickness since the pandemic.
The Labour Market Advisory Board, made up of experts from across business, industrial relations and academia has been assembled to help shape government work ahead of the publication of a White Paper this autumn.
The panel, which includes representatives from the Health Foundation, Resolution Foundation, several universities and the Trades Union Congress (TUC), will be paying particular attention to the impact of poor physical and mental health.
It met work and pensions secretary Liz Kendall for the first time this week.
At its first meeting, members offered new approaches to shape government work on economic inactivity, tackling the root causes for people remaining out of work such as poor physical and mental health, and how the group can help the government reach its ambition of an 80% employment rate.
The Department for Work and Pensions (DWP) said the board will develop new ideas and initiatives for the work and pensions secretary to consider as she sets about bringing down the levels of economic inactivity, with the UK being the only G7 country whose employment and inactivity rates have not returned to pre-pandemic levels.
Across the United Kingdom approximately 9.4 million people or 22% of the workforce are economically inactive, according to DWP data.
2.8 million on long-term sick
Work and pensions secretary Liz Kendall MP (pictured) said: “Spiralling inactivity is the greatest employment challenge for a generation, with a near record 2.8 million people out of work due to long-term sickness.
“Addressing these challenges will take time, but we’re going to fix the foundations of the economy and tackle economic inactivity.
“The board’s knowledge, expertise and insight will help us to rebuild Britain as we deliver our growth mission, drive up opportunity and make every part of the country better off.
“As the health secretary Wes Streeting has previously set out, cutting NHS waiting lists will get Britain back to health and back to work. and the board’s first meeting will examine the impact of ill-health on inactivity and how the government can support more people into good work.”
Paul Gregg, chairman of the Labour Market Advisory Board, said: “Having studied the UK’s labour market across several decades, it is clear that the current labour market faces a deep-seated set of challenges.
“We have seen a sharp increase in economic inactivity and long-term sickness, most notably in our young people post-pandemic.
“Further, real wage growth has been heavily supressed for 15 years hitting living standards and government tax revenues. Reversing these trends will be key to ensuring the long-term prosperity of the UK’s labour market.
“I look forward to working with members of the board and the Secretary of State to support her vision for growth and examining positive solutions to address inactivity and harness the true potential of the UK’s labour market.”
The secretary of state is also expected to outline her plans to devolve power to local areas so they can tackle inactivity with bespoke work, health, and skills plans, which are expected in a White Paper in the autumn.
It will also include plans for a new youth guarantee for 18-21-year-olds, and the overhauling of jobcentres by merging them with the National Careers service.
Board members are:
- chairman, Paul Gregg and former director of the Centre for Analysis of Social Policy at the University of Bath,
- Steven Machin, professor of economics and director of the Centre for Economic Performance, at the London School of Economics (LSE),
- Lindsey Macmillian, professor of economics at the Centre for Education Policy and Equalising Opportunities,
- Gavin Kelly, executive chairman of the Resolution Foundation,
- Anita Charlesworth, director of research and economics at the Health Foundation,
- Stuart McIntyre, professor of economics at the University of Strathclyde,
- Ruby McGregor Smith of the House of Lords,
- Nicola Smith, head of the rights, international, social and economics department at the TUC.