Barnsley, a former mining town scarred by the mass unemployment of the 1980s, presents a microcosm of Britain’s contemporary economic inactivity challenge. While unemployment rates have fallen below the national average, a significant portion of the population remains economically inactive due to ill health and disability, mirroring a national trend. This high rate of economic inactivity, with 2.8 million Britons currently off work due to sickness, poses a severe threat to the UK’s economic growth. The shortage of labour it creates hinders economic expansion, while the burgeoning cost of sickness benefits, projected to reach £75 billion by the end of Parliament, threatens the sustainability of the welfare system. Barnsley’s experience and the recommendations of a recent commission offer valuable insights into addressing this complex issue.
The commission’s findings highlight a critical systemic failure: while a vast majority of those off work due to sickness express a desire to work and receive benefits, very few engage with employment services that could facilitate their return to the workforce. This disconnect underscores the need for a multi-pronged approach to reform. The current system often disincentivizes work by offering higher benefits to those classified as too sick to work compared to those actively seeking employment. While acknowledging the need for increased financial support for individuals with severe disabilities, the commission advocates for narrowing this gap over time, promoting a system that encourages and rewards work. This echoes the Labour government’s Youth Guarantee, which ties benefits to job-seeking or training for young people, and suggests extending a similar “duty to engage” with employment services for all benefit recipients.
The prevalence of health conditions among the economically inactive population in Barnsley, with three in four individuals reporting a health issue requiring attention, further emphasizes the urgent need for early intervention, particularly amongst young people. The current system often sees a detrimental cycle where prolonged periods out of work diminish the likelihood of returning. The commission proposes a more integrated approach between employment and health services, advocating for greater NHS involvement in facilitating a return to work and encouraging employers to prioritize workplace occupational healthcare to retain employees. Preventing a generation from being consigned to a life without work and hope requires a proactive and collaborative effort.
Furthermore, reforming the employment landscape itself is crucial. The commission recommends creating an environment where jobs are secure, flexible, and well-paid, thereby increasing the incentive to work by widening the gap between wages and benefits. A national Good Employer Charter could highlight quality work opportunities, while allowing claimants to trial jobs without jeopardizing their benefits could alleviate fears surrounding re-entering the workforce. These measures aim to make employment a more attractive and viable option for those currently on sickness benefits.
The current employment support system is characterized by complexity and fragmentation, with numerous overlapping programs and agencies. The commission calls for radical streamlining, including the denationalization of JobCentres, given their low utilization by employers, to better cater to local needs. Empowering local authorities, specifically mayors, with greater control over employment and careers services is seen as a key step. Incentivizing performance by allowing high-performing areas to reinvest savings from reduced benefit payouts could further drive down economic inactivity.
Finally, the commission emphasizes the importance of prioritizing domestic solutions over relying solely on immigration to address labour shortages. While immigration plays a role, the potential for reintegrating millions of economically inactive Britons into the workforce represents a significant untapped resource. By setting clear targets for reducing economic inactivity and adopting a national mission that prioritizes the right to work and provides comprehensive support, the UK can unlock this potential, fostering a more inclusive and productive economy. This requires a concerted effort from government, employers, local authorities, communities, and individuals to achieve a meaningful and lasting impact.
