1 in 4 Labour Market Exits Due to Ill Health

New report indicates 1% of the working population leaves work each year due to health-related issues.

A recent report commissioned by UNUM UK,  prepared by The Institute for Social and Economic Research at the University of Essex (October 2011), and covering a period of some 18 years, has concluded that 25% of those exiting the labour market do so for health reasons.

It also found that those who left work due to illness were aged 45 or older, 60% were the main breadwinner in their household and two-thirds had left full-time employment. Significantly, the majority were likely to be widowed, divorced or separated. Not surprisingly, the survey, which used data from 10,000 individuals, found that withdrawal from employment for health reasons resulted in a fall of 25% in household income, a 60% chance of stopping saving and a high probability of falling into debt.

Predictably, people who left work because of illness expressed dissatisfaction with their material wellbeing and reduced their expenditure on leisure activities and eating out. What is perhaps less obvious is the knock-on impact on other household members, particularly a spouse. For example, the spouses of those who leave work in these circumstances are less likely to be employed themselves in the first place and those that do have jobs are more likely to leave them, compounding the family’s problems.

A key difference between those having to leave work due to ill health and those entering unemployment for other reasons, is the associated length of absence from the workplace. Three-quarters of people in poor health remained off work for 12 months or longer, compared to less than 50% of the unemployed.

Source:  UNUM 31 January 2012

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Brunsdon LLP and Brunsdon Financial Services Ltd are authorised and regulated by the Financial Services Authority.

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