Health and well-being in retreat, stalling UK economy, says former Bank of England economist | Sports management

Health and well-being in retreat, stalling UK economy, says former Bank of England economist |  Sports management

By Frances Marcellin November 14, 2022

Declining health is impacting UK economic growth / Shutterstock/Agenturfotografin

The deteriorating health of the British is stunting the nation’s economic growth. That’s the key message from Andy Haldane, chief executive of the Royal Society of Arts (RSA) and former chief economist at the Bank of England, speaking at the Health Foundation thinktank’s annual Real Challenge conference.

“We are in a situation for the first time, probably since the industrial revolution, where health and well-being are in retreat,” Haldane said. Having been a wellbeing accelerator for the past 200 years, health now acts as a brake on the increased growth and wellbeing of our citizens.”

Haldane said that although the workforce was already shrinking before the pandemic, a further reduction in the UK workforce, as a result of COVID-19, was also critical.

According to The Health Foundation, economic activity in the UK has fallen by 700,000 people since before the pandemic. Some 300,000 people aged 50-69 are most at risk of never returning to work and of the 3.5 million active people aged 50-69 in the second quarter of 2022, 1.6 million reported having problems of health as the main reason for not working .

“It should come as no surprise that, therefore, we see macroeconomic headwinds such as a record number of job vacancies,” Haldane said. “We don’t have enough people.”

Haldane also highlighted the government’s lack of investment in healthcare. “When you look at spending on health systems, at least compared to the G7, the UK is at the bottom of the table,” he said.

In 2019, the UK spent £177bn on healthcare (£2,647 per person), which is lower than the G7 average (£3,523). In comparison, France’s health expenditure was £3,308 per capita and Germany’s £4,131 per capita.

UK government spending on healthcare, including spending by the NHS, local authorities and other public bodies that fund healthcare, increased to £213.4 billion in 2020, equivalent to £3,181 per person.

The UK has seen its employment rate fall over the past two-and-a-half years, while other major economies have seen increases in employment. It is currently at 75.5%, having dropped from 76.1% in 2019.

Outside of Latin America, only the UK, Iceland, Switzerland, Latvia and the US have seen employment declines since 2019, while most other EU countries have increased by an average of 2% since the start of the pandemic.

Haldane has not commented on the impact of Brexit.

Liz Terry, editor of HCM extensionsaid: “We have long debated that the health, fitness and physical activity sectors in the UK should enjoy the support of all portfolios from both the Department for Business, Energy and Industrial Strategy, and the Department for culture, media and sport This statement by Andy Haldane, one of the world’s leading economists, shows why this is so vital.

“Having a fit and healthy workforce is vital to driving economic success and if the UK government recognized this and truly supported the physical activity sector, it would make a huge difference to the nation’s economic output,” he said Terry.

“As we await the budget this week, we call on the Government to recognize the bigger picture when it comes to the vital role played by the health and fitness and physical activity sector in providing health and vitality to the nation and to give the sector the funding support it needs to thrive.

A Commission report on the future of job support has found that if current trends continue, by the first quarter of 2023 the UK will be the only developed economy with a lower employment rate than before the pandemic.

About 600,000 have dropped out of the workforce, including 200,000 who have been out of work for five years or more due to health problems.

Around 30,000 people with long-term COVID are unable to work and around 50,000 have taken early retirement since 2020, while the number who have never worked has grown by 250,000 to include students and people with health problems or disabilities.

The situation is exacerbated by the retirement of the baby boom generation and the declining rate of migration, with 500,000 fewer UK-born workers than there would have been if the UK had continued to follow pre-2016 trends.

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