The UK has suffered the biggest drop in employment of G7 countries through the pandemic, leaving employers short of workers. New research by Learning and Work Institute suggests that a plan to get 1.7 million people back to work could boost the economy by £23 billion per year and increase annual incomes of the poorest households by up to £2000.
Despite low unemployment, employers are struggling to fill all their roles. A key reason is an exodus of people over 50 and those who are long-term sick from the labour market, a trend not seen in most other countries and likely exacerbated by long NHS waiting lists. Many of these say they want to work, but the research finds only one in ten are getting help from the Government to look for jobs. That’s because current support from Jobcentre Plus is mostly focused on those who are unemployed and claiming benefits, meaning millions miss out.
In its new report, Towards full employment, Learning and Work Institute shows that, to tackle the stagnating labour market and have the highest employment rate in the G7 within a decade, on a path to a world-leading 80% employment rate by 2035, an extra 1.7 million people would need to be in work. This would help boost our economy by £23 billion, improve the public finances by £8 billion, and raise average household incomes by £830 per year. It would require a step change in the scale and reach of employment support, in particular to better help disabled people and older people who want to work.