Work Health and Opportunity: Building a More Inclusive UK Labour Market

15th October 2025

The health and employment outcomes of working-age adults are closely interlinked. Poor health reduces an individual's capacity to participate in the labour market, while unemployment and job insecurity are associated with worse physical and mental health outcomes.

In the UK, economic inactivity among working-age adults due to long-term sickness has reached record levels, with more than 2.8 million people out of work for health reasons.

Addressing this challenge is vital both for individual wellbeing and for economic productivity. This essay outlines how UK policy-makers can strengthen the health and employment prospects of working-age people through coordinated action across health, welfare, and labour-market systems.

1. Investing in Preventive Health

A first priority is to reduce the incidence of preventable illness. Chronic conditions such as obesity, type 2 diabetes, and cardiovascular disease are leading causes of work absence and early labour-market exit in the UK. Policy-makers should therefore scale up public health prevention programmes — including smoking cessation, healthy eating initiatives, and physical activity schemes — particularly in deprived areas where health inequalities are greatest. Fiscal tools such as the Soft Drinks Industry Levy have shown that targeted taxation can drive healthier consumption patterns; similar approaches could be expanded to high-sugar or ultra-processed foods.

The NHS and local authorities can collaborate to embed workplace-based health promotion, offering health checks and vaccination campaigns through employers. These initiatives help reach working-age adults who rarely engage with healthcare services, supporting early detection and management of health risks.

2. Creating Healthier and More Flexible Workplaces

Workplace design and employment practices play a decisive role in health outcomes. The UK could strengthen the Health and Safety Executive's capacity to enforce standards around ergonomics, stress prevention, and occupational health. Extending statutory paid sick leave and encouraging phased return-to-work schemes would help workers recover fully before resuming employment, reducing long-term sickness absence.

Flexible working, enshrined in UK law but unevenly implemented, can be further normalised. Policies supporting remote and part-time options allow people with chronic illness, disabilities, or caring responsibilities to remain economically active. The government can incentivise employers—especially small and medium enterprises (SMEs)—to adopt such practices through tax reliefs or grants for workplace adaptations.

3. Supporting Mental Health and Reducing Substance Misuse

Mental ill-health has become the leading cause of economic inactivity among working-age adults in the UK. Integrating mental health support into primary care and occupational settings is therefore essential. The NHS's "Improving Access to Psychological Therapies" (IAPT) programme could be expanded to include employment support specialists who assist individuals in maintaining or regaining work. Employers should also be encouraged to offer mental health first-aider training and confidential counselling services.

Substance misuse, often linked to unemployment and deprivation, can be addressed through community treatment and rehabilitation programmes that include structured pathways back into employment. This approach aligns with the UK Government's 10-year drug strategy, which recognises the importance of employment in sustaining recovery.

4. Active Labour-Market Policies

The UK’s Department for Work and Pensions (DWP) can strengthen active labour-market policies (ALMPs) that combine job search assistance, skills training, and health-related support. Programmes such as the Work and Health Programme and Individual Placement and Support (IPS) have demonstrated that tailored, person-centred approaches help people with health conditions return to work. These should be scaled nationally, with adequate funding for personalised case management and occupational therapy input.

Moreover, apprenticeships and reskilling initiatives can prepare workers for growth sectors such as green technology and digital services. Ensuring access to affordable childcare and transport is crucial to making these opportunities accessible to lower-income households.

5. Addressing Inequalities and Supporting Caregivers

Health and employment inequalities persist along lines of class, gender, ethnicity, and region. Women, older workers, and people in deprived communities are particularly vulnerable to both poor health and insecure employment. Expanding access to affordable, high-quality childcare and improving carer’s leave entitlements would help parents and caregivers stay in work. At the same time, "levelling up" investment in local health and employment services can reduce regional disparities, especially in areas with high inactivity such as parts of the North East and Wales.

6. Reforming Benefits and Financial Incentives

The design of benefits and tax credits can unintentionally discourage people with fluctuating health conditions from re-entering the labour market. Reforming the fit note system, improving Occupational Health services, and tapering benefits to ensure that "work always pays" would reduce disincentives to take on part-time or flexible work. Pilot schemes—such as offering employers subsidies for retaining staff during health-related absences—could prevent permanent labour-market exits.

7. Data, Evaluation, and Coordination

Better data and cross-government coordination are essential. Linking NHS, DWP, and HMRC data would allow policy-makers to identify patterns of health-related worklessness and evaluate the impact of interventions. The UK should establish a cross-ministerial taskforce on health and employment, bringing together the Departments of Health, Work and Pensions, Education, and Treasury, alongside employers and trade unions. This body could oversee pilot projects, share best practice, and ensure accountability across sectors.

Conclusion

Improving the health and employment of the UK’s working-age population requires a holistic, joined-up approach. Policies that prioritise preventive health, flexible and supportive workplaces, mental health investment, and active labour-market interventions can yield substantial economic and social returns. As the UK faces an ageing workforce and persistent post-pandemic health challenges, integrating health and employment policy is not only a moral imperative but also an economic necessity. A healthier workforce is a more productive, resilient, and inclusive one — and effective policy-making in this area represents one of the best long-term investments the UK can make.