Work absences due to long-term sickness could cost the economy £66.3bn a year by 2030 in lost productivity

A new study released today by insurer Zurich UK and the Centre for Economics and Business Research (Cebr) found that the number of workers with long-term health conditions has increased by 27% in the last six years to a record high of 10.3 million¹. These workers took a total of 112.5m sick days in 2023, an increase of nearly 70% over the same period².

In 2023, this costs the UK economy £32.7bn³ in lost productivity. This marks the third consecutive yearly increase in lost productivity, from an estimated £24.6bn in 2021 and £30.7bn in 2022. If current trends continue, work absences due to long-term sickness will cost the economy £66.3bn a year by 2030 in lost productivity.

According to Peter Hamilton, Head of Market Engagement at Zurich:

“Work absences due to long-term sickness hurt the individual, the employer, and the wider economy. There are plenty of opportunities to bring the number of absences down – we’re simply not making the most of them.”

While long Covid could be partly responsible for the rise, the research found the upwards trend was already present before the pandemic, suggesting other drivers are at play. Long periods of absence can themselves create more complex medical issues, so that the original condition is often compounded by mental health struggles, anxiety, and general repercussions of being out of ‘normal life’ for long periods of time.

When it comes to the size of businesses most impacted, small and medium size enterprises (SMEs) with up to 250 employees are hit the hardest. They are currently picking up 76% of the 2023 long-term sick bill totalling £24.7bn⁴.

The Cebr research reveals there has been a noticeable uptick in the proportion of those in employment experiencing long-term health conditions. In 2017, people with long-term conditions accounted for 25.4% of those in employment, though this has since risen to 30.7% as of 2022. A continuation of this current trend would see the share hit 36.1% by 2027, before rising further to 40.1% by 2030.

If trends continue, the costs associated with absence among those with long-term health conditions would rise significantly in the coming years, reaching an estimated £66.3 billion by 2030. This loss would be the equivalent to 2.5% of the UK’s total productivity.

The study is released as the Government looks at alternative ways to tackle the growing number of people on long term sick leave. Media reports have cited potential interventions such as ‘social prescribing’ schemes which offer jogging, singing, cooking or gardening to help get people back to work. The Government is also reported to be drawing up minimum rules for companies to provide occupational health to their employees. Zurich is now calling for the Government to include rehabilitation as part of the roadmap.

Zurich’s research coincides with recent analysis from the Office for National Statistics which also found that the rise in work-limiting health conditions was the largest contributing factor to the rise in economic inactivity across the economy⁵.

What are the biggest contributors to employees taking 112m sick days a year?

OnePoll research commissioned by Zurich amongst 1,000 employees (from a range of businesses) who have been on long term sick in the last 12 months found that the biggest contributors are mental health issues (44%) and musculoskeletal problems (14%) such as back pain. These absences alone cost the economy around £5.9bn and £6.1bn respectively a year, according to Cebr. An increase in musculoskeletal issues could in part be attributed to an increase in home working, with many employees still using sub-standard space and equipment, leading to poor posture.

The next biggest contributors to people being off sick are respiratory conditions (7%) and gastrointestinal problems (7%).

Peter Hamilton, Head of Market at Zurich comments:

“The Cebr findings reflect what we are seeing from our customers. With so many people now working from home, musculoskeletal issues are likely to continue to represent a dominant part of the problem, as too many employees will not have the correct home office set up. This, coupled with the widely reported challenge of hospital waiting times, is creating the perfect storm for an increasingly absent workforce.

“But the wider issue here isn’t about people wanting to be off work - the vast majority want to get back to ‘normal life’ as quickly as they can. There is a requirement for multiple interventions from both the Government and employers to make sure people have the support they need to rehabilitate.”

The ONS identified lengthening hospital waiting times as a further factor increasing long-term health absences, finding that a third of the total inactive population excluding retirees were waiting for some form of treatment.

Further findings from Zurich and One Poll’s survey reveals that over two thirds (64%) of long-term sick experienced anxiety as a result of their time off work. Over half (53%) suffered from depression and 39% loneliness. Most alarmingly, 16% had suicidal thoughts, one in ten resorted to increase alcohol consumption and 5% substance abuse.

Despite this, just one third (33%) of these employees were offered rehabilitation support by their employer, and just 22% were offered relapse prevention services.

Kim Leadbeater MP said:

“The UK’s workforce is not fighting fit. I’m pleased to say that awareness is increasing among employers of the benefits of improving the health and wellbeing of their workforce but there is definitely more to be done.

“Zurich’s research shows the need to spread best practice among employers about how to prevent illness in the workplace through a national ‘health at work’ standard, including provision of vital vocational rehabilitation services, to return the long-term sick to productive employment.

“As I set out in my Healthy Britain Report in 2023, I believe we need a much more comprehensive approach to the health and wellbeing of the nation, and increased support from employers will help unlock the full potential of the UK’s workforce and generate economic growth.”

Invictus Gold medallist JJ Chalmers said:

“It’s in the toughest times when you really realise who you have in your corner. Luckily, the Royal Marines were like an extended family for me and were firmly in mine, but for too many people, their employers don’t even consider the importance of this kind of support.

“Businesses really need to take a leaf out of the military’s book – if you want a resilient and motivated workforce, your people need to know you will offer the right help when people really need it. Through this process of recovery, it can make us much more resilient and stronger all round.”

Rehabilitation, the unsung hero helping people back to work

Data from the Association of British Insurers (ABI), shows that insurers are already making a major contribution towards reducing the length and frequency of long-term sickness absence. This ensures people do not drop out of the labour market altogether, in turn maintaining the supply of labour.

• In 2021, over 1.6m people used the health services available to them through insurance. This encompasses services for prevention, early care, diagnosis, treatment, recovery, and support.
• These customers used the services 5.5m times in 2021, 3.5 times per person on average.
• An analysis of around 16,000 vocational rehabilitation cases found that nearly 9 in 10 (86%) people remained in the workforce following access to rehabilitation services through insurance.

Peter Hamilton, Head of Market at Zurich comments:

“We’d really like to see the Government set out a long-term roadmap to tackle the issue of workplace health head on and for rehabilitation – the unsung hero which helps people back to work – to be an integral part of this.”

About Zurich’s rehabilitation services

Available to all Group Income Protection customers, Zurich’s in-house team of rehabilitation specialists can provide support and guidance to help employees get back to work, quickly and safely.

The insurer’s comprehensive service includes:

• Mental health support from fully qualified, registered mental health nurses.
• The Rehab Access Clinic, which provides access for HR personnel to speak directly to Zurich’s medically qualified rehabilitation consultants.
• Presenteeism support and early intervention services to help workers return to good health and help prevent absences from occurring – see Zurich’s early intervention and claim notification guide for more details.
• Return to work planning, including facilitating discussions and providing guidance regarding reasonable adjustments to an employee's hours, duties, or workplace.
• Free online workshops exclusively for HR and people managers, covering topics such as the Menopause, Managing Neurodiversity, Occupational Burnout and supporting mental wellbeing at work – see our 2023 rehabilitation training workshop calendar.

Find out more about Zurich’s Corporate Risk rehab support services here. Rehab services are also available to customers with Employers’ Liability Insurance through The Zurich General Insurance Rehabilitation Team. Find out more here.

¹Cebr research shows that from 8.1m 2017 to 10.3m in 2023 = 27%
²Cebr research shows that from 67.1m in 2017 to 112.5m in 2023
³Cebr’s estimates for these costs combine official data on the prevalence of long-term health conditions, frequency of sick days, and GVA per worker.
⁴This reflects this grouping’s higher than average GVA per worker as well as the fact that this group accounts for the largest share of sick days taken.
⁵ONS