Levelling up: the £8bn cost of ill health to the economy

A new report today links deprivation, ill health and economic under-performance as factors holding back areas like the North East and costing the national economy, it says, £8bn this year alone.

‘The damage done to both lives and livelihoods can be put down to a collision of a major health shock [the pandemic] and the structural weaknesses of the UK’s approach to both its health and its economy’ says the report ‘Health and prosperity: Introducing the Commission on Health and Prosperity, published today by the Institute for Public Policy Research (IPPR)*.

This is the second time in two days that this site has focused on the link between health and the economy, following our report yesterday on an essay by Andy Haldane, chief executive of the Royal Society of Arts and part author of the Levelling Up White Paper published on February 2.

Today’s report says: ‘Better health can provide much needed productivity gains, in the face of the UK’s long-standing productivity problems. It can support levelling up, by ensuring productivity gains extend across the country, it can support national income, and it can ensure that gains on national economic measures do translate into better, more meaningful lives. Better health can deliver prosperity across the UK’.

‘[C]orrecting our failures on population health’ it adds, ‘could help alleviate key economic challenges facing the UK, including low growth, low productivity, labour market losses and wide inequality’.

The report estimates that if the local authorities with the poorest health had their health outcomes boosted to at least equal to the top 10% productivity would increase by 1.5% –  more than double the average annual increase since the financial crash.

The biggest gains from better health are possible in places where health and productivity have historically been lower, it says, such as the north of England. According to Northern Agenda, the places that stand to gain most include Sunderland, South Tyneside and Redcar & Cleveland.

The IPPR report estimates that ill health during the pandemic has directly or indirectly driven around 400,000 people from the national workforce, costing the economy £8bn this year. The problem of economic inactivity in the North East – people dropping out of the workforce – was highlighted on this website on April 12, when we reported that inactivity was at its highest in the region since 2015.

In a strong moral message, today’s report comments: ‘[T]his analysis of the health and economic impacts of Covid-19 make clear that we urgently need a new approach to protecting people’s lives and their livelihoods.

‘If the promises made by politicians to “build back better” from Covid-19 – as well as national missions to level-up health and economic opportunity – are to mean anything, they must mean creating a better, fairer country, from the pandemic’s ashes. Anything less would be a betrayal of the tens of thousands of people who lost their lives, and the millions who suffered huge hardship, in the last two years’.

‘The case for prioritising better health goes beyond simple justice, as important as that is, it adds. ‘Health is also the foundation of a just and equal economy. In fact, solving the historic health challenges outlined in [this report] can help resolve the major economic challenges we have…highlighted. ‘

The Commission on Health and Prosperity, which will present its final report in 2023, is co-chaired by Lord Ara Darzi, Paul Hamlyn Chair of Surgery, Imperial College London and former health minister, and Dame Sally Davies, Master of Trinity College Cambridge and former Chief Medical Officer. The members include Clare Bambra, Professor of Public Health, Newcastle University 

*Thomas C, Jung C, Patel P, Quilter-Pinner H and Statham R (2022) Health and prosperity: Introducing the Commission on Health and Prosperity, IPPR. http://www.ippr.org/research/publications/health-and-prosperity