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Dev-Bank Wales MBO


30 April 2024

Long-Term Sickness is Weighing Down Our Economy


Ian Price
CBI Wales

Recently I had the opportunity to visit a number of businesses in south Wales with our CEO Rain Newton-Smith. We took the opportunity to discuss how the CBI can help them grow in size, scale and contribute to a sustainable local economy. 

Our ‘road-trip’ took in firms across south Wales, from Newport to the Vale of Glamorgan and Cardiff, and a meeting with the new First Minister. We also took part in a working dinner, hosted by Acuity Law, at the capital’s Parkgate Hotel that attracted a number of public and private sector organisations. Ogi also hosted the CBI Wales Women’s Leadership Group lunch and networking meeting at their head office.

A talking point was the number of workers absent from the economy due to long-term sickness, and the impact that has on core staff keeping businesses running – with many feeling acute pressure from filling in the staffing gaps, and, in some cases, being ‘burnt out’ by the experience.

The latest Labour force data from the Office for National Statistics confirmed what many people and businesses across Wales have known for some time – that the number of workers absent due to long-term sickness across the UK has risen significantly to its highest level ever.

Post-pandemic economic inactivity is a problem across the board and many people are living day in day out with health conditions that prevent them working and she was keen to hear from Welsh firms about how they can be supported, particularly in the arena of mental health.

That’s not just a concern for the individuals involved – particularly as they battle mental health issues, chronic conditions and type-2 diabetes – but for the Welsh and UK governments, business and the local economy overall. Our own research points at £180bn of lost output, and millions of lost working days across the UK.

With a new First Minister and Cabinet Secretary for the Economy, and a general election fast approaching, it’s welcome to see politicians from across the political spectrum grappling with an issue that has long concerned businesses. After some really tough years for the economy, firms know that we can’t build a competitive economy without a resilient labour market – and that means prioritising the health of our people.

Given the NHS in Wales is already under severe strain, workers are increasingly looking to their employer to help. Many firms are already doing great work in supporting employee health and wellbeing, but more could be done – especially in terms of prevention – with better incentives. That’s something backed up by our research.

Business-led health interventions such as free health screening, employee assistance programmes and workplace ergonomic assessments could contribute up to £36 billion in output to the economy through a 20% reduction in the impact of ill-health on our collective workforce.

One of the best places to start is implementing an ambitious expansion of tax-free occupational health support to incentivise businesses to invest in early workforce health interventions and prevent employees leaving the labour market.

Without urgent action the situation will only get worse and recent projections on future ill-health from the Health Foundation certainly making for concerning reading. With many of the factors driving increased ill-health found to be related to income distribution, the need to increase prosperity across all parts of the country has never been more stark.

While economic data maybe starting to head in the right direction, with inflation coming down and the UK moving out of recession, things aren’t really rebounding quickly enough. We need thriving firms to create the kind of high paid, stable jobs that will boost incomes and help break the relationship with ill-health, as well as helping to fund essential public services.

Given the challenges that many businesses face in accessing the people and skills they need, growing awareness of the need to tackle economic inactivity is clearly welcome. With such a complex and multifaced problem, we can’t afford to leave this to politicians and policymakers alone. Meaningful consultation with healthcare professionals and businesses is essential if we want to deliver lasting solutions.

The virtuous cycle between better performing businesses, a growing economy, and a healthier and more resilient workforce is something we all aspire to. While that will likely take some time to deliver, we must now prioritise more immediate solutions like boosting workplace health provision. With Welsh business ready to play its part, we just need government to match that ambition with the incentives required to catalyse action.

As our Chair Alison Orrells told CBI members at our dinner, businesses have the drive, passion and determination to make change happen in Wales.


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