Why low and middle income earners are working longer – and are sicker
Low-middle-income families are 'older and sicker' than 30 years ago.
The number of lower and middle-income earners out of work has fallen significantly in the past 30 years, a new report has revealed – but they are more likely to be older and sicker than before.
The Resolution Foundation's investigation looked at how the living standards of the bottom 50% of earners had changed in the past 30 years.
The report's release comes against a backdrop of government plans to get more people with long-term sickness back into work.
The work and pensions secretary Liz Kendall has previously described growing levels of "worklessness" as "unacceptable" and insisted action is needed to help cut the enormous £266bn benefits budget.
The 2.8 million people out of work due to long-term sickness are, the government says, part of a wider problem "holding back productivity and stunting growth".
What is worklessness?
Worklessness is defined as someone who is not working for any reason.
"That would include people who are unemployed but actively searching for a job," Louise Murphy, a senior economist from the Resolution Foundation explained.
It would also include people who are not searching for a job, such as students and people who might be looking after children or elderly relatives.
"Quite importantly, it also includes people who are out of work because they themselves are sick or disabled," says Murphy.
Why are fewer of us out of work?
The research, released in a paper named Unsung Britain, looks at how the living standards of the 13 million or so families earning low and middle incomes have changed since the mid-1990s.
It compares data from 1996-97 to 2022-23 and finds that- the decline in worklessness has been driven by rising employment among women. The employment rate of mothers has increased sharply from 46% in 1996-97 to 58% by 2022-23.
"Overall worklessness has fallen," Murphy told Yahoo News. "Historically in the 1990s and early 2000s, quite a high proportion of either single-parent women or women in couples with children were out of work.
"We've seen a fairly steady rise in the employment rate among women. Also in the 2010s, what we saw was a slightly more general rise in the employment rate, which reflected the impact of the financial crisis."
It is thought that people worked more and longer hours during this time because of the onset of the recession, sparking fears that they would lose their jobs.
Sicker and older - but more likely to be in work
One of the more startling findings of the report is that low and middle-income families are much older and sicker than in recent decades.
In the 1990s, people in this group were around 60% more likely to be in their 20s. Now, however, the lower earners in society are just as likely to be in their 50s as in their 20s.
In addition, three in 10 working-age adults in this bracket said they had a disability in 2022-23, up from less than two in 10 in the mid-1990s.
The chart below shows the scale of the problem, with workers on higher salaries far more protected from sickness. However, the report suggests that the scale of the worklessness problem is less severe than in previous years, despite the stated concerns of the the government.
In part, the problem has been put down to rising levels of obesity and the fallout of COVID.
An estimated 1.9 million people live with long COVID in the UK, many with debilitating symptoms.
In order to tackle the obesity crisis, health secretary Wes Streeting proposed giving weight loss jabs to unemployed people living with obesity to help them back into work. Streeting has defended the plans in the face of some criticism, insisting the approach is not "dystopian".
“The 13 million low-to-middle income families across Britain today are older and sicker than a generation ago," Mike Brewer, interim chief executive of the Resolution Foundation, said.
"But, although these trends have come to the fore in recent years as long-term sickness has hit record levels, a longer-term view shows that worklessness is a far smaller problem than it used to be. That’s mainly due to the major strides Britain has taken in terms of parental employment.
“As low-to-middle income Britain has changed, so too have the policy challenges they face. We should learn the lessons of how a new policy settlement has boosted parental employment over time, as we look to new challenges like ill-health and disability," he added.
"If people are sicker, they may not only find it more challenging to navigate an inaccessible world — but require more government support for a longer period of time."
Does Britain have a sick-note culture?
The government has said its plans to 'get Britain working' will include work, skills and health support for disabled people and long-term sick. It is keen to slash the £266bn welfare budget by £3bn.
Specific proposals so far include merging the National Careers Service and Jobcentre Plus; bringing in more regional support; and potentially doling out sanctions to young people who don't take up training opportunities.
In the October budget, chancellor Rachel Reeves signalled sweeping reforms to health and disability benefits in the early part of 2025 “to ensure the system supports people who can work to remain in or start employment, in a way that is fair and fiscally sustainable”.
She said Labour had inherited the last government’s plans to reform the work capability assessment and pledged to “deliver those savings as part of fundamental reforms".
Her plans also include a crackdown on welfare fraud.
However, disability charities including United Response have accused Labour of carrying out a negative rhetoric on welfare.
The Joseph Rowntree Foundation, a social change organisation, has warned that the government had “failed to explain how they will save £3bn from the benefits bill” meaning those on welfare have been left with “no certainty and more anxiety rather than the respect they deserve”.
It was also announced this month that the House of Lords economic affairs committee will launch an investigation into whether there is a link between the UK’s benefits system and long-term sickness levels.
Last week, Kendall reiterated her focus on reducing the benefits bill by reducing levels of worklessness as a result of sickness still further. “Life expectancy and healthy life expectancy stalled long, long before COVID hit, and we need to get people back to health, back to work," she said. "We need to sort out problems in the NHS. We need to intervene earlier. We need to tackle the root causes of ill health.
“2.8 million people – a near record number are locked out of work due to poor health. This is bad for people, bad for businesses and it’s holding our economy back."
The DWP has been approached for comment.
