Business
Britain sliding ‘into economic crisis’ over £85bn sickness bill, ex-John Lewis boss warns
Emer MoreauBusiness reporter
Getty ImagesThe number of sick and disabled people out of work is putting the UK at risk of an “economic inactivity crisis” that threatens the country’s prosperity, according to a new report.
There were 800,000 more people out of work now than in 2019 due to health conditions, costing employers £85bn a year, according to the review by former John Lewis boss Sir Charlie Mayfield.
The problem could worsen without intervention, but Sir Charlie, who will lead a taskforce aimed at helping people return to work, said this was “not inevitable”.
The move has been broadly welcomed, but some business groups said Labour’s Employment Rights Bill included some disincentives to hiring people with existing illnesses.
One in five working age people were out of work, and not seeking work, according to the report, which was commissioned by the Department for Work and Pensions but produced independently.
Without intervention, another 600,000 people could leave work due to health reasons by the end of the decade.
Sir Charlie said sickness cost employers £85bn a year through issues including lost productivity and sick pay, but it also cost the broader economy.
“Work is generally good for health and health is good for work,” he told BBC Breakfast.
He added that the rise in sickness was being driven by a “surge” in mental health issues among young people and muscular skeletal issues, aches and joint pain in older people that was leading them to leave work.
“For employers, sickness and staff turnover bring disruption, cost and lost experience,” he said. “For the country, it means weaker growth, higher welfare spending and greater pressure on the NHS.”
Illness-related inactivity costs the UK economy £212bn annually, by some estimates, or nearly 70% of income tax, through lost output, increased welfare payments and additional burdens on the NHS.
The independent Office for Budget Responsibility has forecast that the bill for health and disability benefits for working age people alone is set to rise to about £72.3bn in 2029-30.
People could be encouraged to stay in work if health is viewed as “a shared responsibility between employers, employees and health services”, he said.
Sir Charlie added his taskforce would work with GPs who say they find it difficult to judge whether or not a person is suitable to work while they are ill, but are asked to issue sick notes by patients.
The report comes as the government tries to move ahead with its Employment Rights Bill – which some businesses say will stifle growth.
The proposed new law includes a right to guaranteed hours and cracks down on zero-hour contracts without the offer of work.
Retailers understand the importance of supportive workplaces, chief executive of the British Retail Consortium Helen Dickinson said, adding that many already invest in programmes to support workers with ill health or disabilities.
However, she said the government’s goals and its policies, such as the Workers Rights Bill, were “at odds with one another”.
“While encouraging employers to invest in workforce health and provide flexibility, they risk making it more difficult,” she said.
“In its current form, the Employment Rights Bill would make it harder for retailers to continue offering as many crucial flexible roles.”
Chancellor Rachel Reeves is also aiming to guarantee paid work to young people who have been out of a job for 18 months.
Those who do not take up the offer could face being stripped of their benefits.
‘I want to find a job’
Loz Sandom has mental and physical health conditions which has made it difficult to find a job, and the last time they worked was a year ago.
“I am willing to do the work, and I want to. I want to find a job,” said the 28-year-old, who has a degree in illustration and has previously worked as a digital marketing executive.
With support from the charity Scope, Loz is looking for an employer willing to accommodate the adjustments they would need in a workplace.
Loz said that part of the challenge was employers did not realise they had “a duty to provide reasonable adjustments”.
“It’s such a shame because they’re missing out on so many fantastic disabled people that can do fabulous jobs.
“And I’m not blaming employers entirely. They need support as well,” Loz added. “There are things that can be put in place to help employers, help save people.”
Responding to the report, the government announced a major partnership with over 60 companies, many of them large employers, to “tackle the rising tide of ill-health that is pushing people out of work”.
The companies include Tesco, Google UK, Nando’s and John Lewis.
Over the next three years, they will “develop and refine workplace health approaches” which aim to “reduce sickness absence, improve return-to-work rates, and increase disability employment rate”.
The government is aiming to develop these changes into a voluntary certified standard by 2029.
Speaking to the BBC, Work and Pensions Secretary Pat McFadden said the report was a “win-win for employees and employers because it’s aimed at keeping people with sickness issues or developing disability issues in work”.
“That’s in the interests of employers because these are good experienced staff and it’s in the interests of employees too because most people want to stay in work if they possibly can.”
The Resolution Foundation think tank’s chief executive Ruth Curtice said: “The review has accurately identified a culture of fear, a dearth of support and structural barriers to work as key challenges to overcome in turning the tide for Britain’s economic inactivity problem – which is currently trending in the wrong direction.”
The CIPD, which represents HR professionals, welcomed the government’s vision for a preventative approach to illness in the workplace.
But its chief executive Peter Cheese said: “The report’s success will depend on the extent to which these recommendations are understood by business in driving positive outcomes and backed by policy makers at a national and regional level.”
Dr Roman Raczka, president of the British Psychological Society, welcomed a shift towards “rehumanising the workplace” but noted that “not everyone will be clinically well enough to be considering a return to employment”.
“While being in employment can improve a person’s mental health and wellbeing in certain circumstances, it is vital that we should adopt a thoughtful approach to those too sick to work.
“The workplace itself can be a root cause of poor mental health.
“Those signed off with sickness, deserve timely access to safe and compassionate care, with support from psychologically informed mental health professionals.”
With additional reporting from Erica Witherington
UK high streets and shopping destinations are showing signs of recovery as more than 13 retail stores opened each week over the past year, according to new figures.
However, England and Wales have still seen more than 6,000 retail premises vanish from local communities over the past five years.
Analysis of Valuation Office Agency data by tax firm Ryan, found that there were 507,810 retail premises across England and Wales at the end of 2025.
It said the figures showed that a recent contraction across the sector has appeared to stabilise, with a 723 net increase in the number of retail stores compared with a year earlier.
Property numbers increased across every region of England and Wales, with the exception of the North West, which saw a decline of 41.
It suggests that parts of the sector are now beginning to rebalance following significant structural contraction seen since the pandemic.
The creation of new retail units also comes as many retail real estate firms, such as Hammerson, have turned empty large units, often former department stores, into a greater number of smaller units.
Other retail groups, such as John Lewis, have moved away from ambitions to transform some retail property for other uses such as rental accommodation.
Nevertheless, the retail sector is still facing pressure from higher business rates for many firms, increased labour costs and concerns over consumer sentiment.
The data also shows that there has also been significant decline over the past few years, with a net reduction of 6,045 retail properties since the end of 2020.
London recorded the largest five-year regional reduction, with 1,266 retail premises disappearing over the period, followed by the South East (-1,191), North West (-719) and North East (-672).
The figures show retail premises which have permanently disappeared from communities altogether, having either been demolished or converted for alternative use.
The figures come as Ryan’s 2026 annual business rates review highlighted that the retail sector saw a 9.3% increase in rateable values at the 2026 business rates revaluation despite the major shift in the retail landscape since the pandemic.
Alex Probyn, practice leader for Europe and Asia-Pacific property tax at Ryan, said: “The pandemic accelerated structural changes that were already emerging across the retail sector, including changing consumer behaviour, hybrid working patterns and a reduced reliance on traditional retail floorspace in many locations.
“Many locations were arguably over-retailed before Covid and high streets have evolved towards more mixed-use environments, with retail space being rebalanced alongside growing demand for residential, leisure, hospitality and service-led uses.
“The revaluation outcome does suggest a large proportion of retail premises have seen bigger increases in their assessments than underlying market conditions and rental evidence would have led occupiers to expect.
“Retailers should therefore carefully review and, where appropriate, challenge their assessments.”
Indians sharply cut back on overseas travel spending in March, with remittances for foreign trips dropping by more than $212 million from the previous month, according to Reserve Bank of India data. The fall in outbound travel expenditure came amid rising oil prices linked to the Middle East conflict and persistent pressure on rupee, even as travel remained the single largest component of outward remittances under the Liberalised Remittance Scheme (LRS).In March, travel-related remittances fell to $1.09 billion from $1.3 billion in February and $1.65 billion in January. The decline came at a time when the West Asia conflict pushed oil prices higher and weakened rupee to record lows. Amid the situation, Prime Minister Narendra Modi urged citizens to cut down on foreign travel and adopt measures such as carpooling. Lower overseas travel spending could reduce foreign exchange outflows and help ease pressure on rupee.According to the RBI’s data on outward remittances by resident individuals, travel continued to account for the largest share of money sent abroad under the LRS in March. Total remittances during the month stood at $2.59 billion.The RBI tracks overseas spending across categories including travel, studies abroad, maintenance of close relatives, overseas investments, and property purchases. Under the LRS framework, resident individuals, including minors, can remit up to $250,000 in a financial year for permitted current or capital account transactions.Within the travel segment, the biggest component remained the ‘other travel’ category, which covers holiday spending and international credit card settlements. Indians spent $623.05 million under this category in March, accounting for nearly 57 per cent of total travel-related remittances during the month.Expenditure linked to education travel, including hostel and fee payments, stood at $450.16 million. Business travel, pilgrimage, and overseas medical treatment together accounted for $21.39 million.The data also showed a rise in remittances meant for the maintenance of close relatives abroad. Such transfers increased to $389.78 million in March from $266.18 million in February.At the same time, spending under the ‘studies abroad’ category declined. This category includes payments made for educational services accessed remotely without travelling overseas, such as correspondence courses. Remittances under this head stood at $151.71 million in March, compared to $175.68 million in February and $267.42 million in January.For the financial year 2024-25, Indians remitted a total of $29.56 billion under the LRS. Travel made up the largest portion of this amount at $16.96 billion.The RBI figures further showed that investments by Indians in overseas equity and debt instruments rose significantly to $440.22 million in March from $265.99 million in February.Meanwhile, outward remittances for the purchase of immovable property overseas declined to $38.68 million in March, down from $51.36 million a month earlier.
Gold and silver are expected to take cues from developments in the ongoing US-Iran talks this week, with analysts forecasting a largely steady trend for gold prices while silver may continue to outperform amid geopolitical tensions and elevated crude oil prices.Investors are also likely to track a series of economic indicators from the United States, including GDP data, housing numbers, consumer confidence figures and the Personal Consumption Expenditure (PCE) inflation print, as markets look for signals on the Federal Reserve’s next policy move.“Gold price momentum next week looks sideways, while silver still looks positive as focus will again be on the peace negotiations between the US and Iran to end the war,” said Pranav Mer, Vice President, EBG – Commodity & Currency Research, JM Financial Services Ltd.Trading activity in domestic commodity futures markets will be curtailed on Thursday morning due to Bakri Id.On the MCX, gold futures ended the previous week at Rs 1.58 lakh per 10 grams after posting marginal gains, while silver futures settled lower at Rs 2.71 lakh per kilogram.“Gold traded in a range-bound manner last week, posting marginal gains of around 0.40% on the MCX to close near Rs 1,58,670 per 10 grams,” said Jateen Trivedi, VP Research Analyst – Commodity and Currency, LKP Securities.He noted that crude oil prices witnessed heavy profit booking during the week and corrected nearly 7% from recent highs, easing concerns around inflationary pressure globally.“At the same time, the rupee recovered from weaker levels of 97 against the US dollar to strengthen near 95.70, which limited upside momentum in domestic gold prices despite stable international bullion trends,” Trivedi added.In international trade, Comex gold futures closed the week 1% lower at $4,523.2 per ounce. Silver futures also weakened, slipping nearly 2% to $76.20 per ounce.“Gold prices moved in a consolidative range over the past few sessions, but ended the week with a marginal loss. Prices were steady amid a lack of fresh direction in the market — be it on the economy front or the US-Iran war front,” Mer said.According to analysts, uncertainty surrounding the geopolitical situation has continued to keep markets on edge, particularly as statements from both Washington and Tehran have frequently shifted.On Sunday, US President Donald Trump said that an agreement between the US and Iran aimed at reducing tensions in the Gulf region and reopening the Strait of Hormuz was close to being finalised.Posting on Truth Social, Trump said the deal had been “largely negotiated” and that only final formalities remained.However, Iranian media disputed Trump’s remarks regarding the full reopening of the Strait of Hormuz, stating that Tehran would continue to maintain control over the key waterway.Analysts said the contrasting positions from both sides are likely to keep bullion prices sensitive to any fresh headlines emerging from the region.Meanwhile, market participants are also expected to monitor comments from Federal Reserve officials after Kevin Warsh formally succeeded Jerome Powell as head of the US central bank on Friday during a period of geopolitical tensions, market volatility and persistent inflation pressures.
Gordon Ramsay reveals ‘most important thing in life’
Shop numbers return to growth after years of decline, say experts
Drake sets new record at ‘Iceman,’ ‘Habibti’ and ‘Maid of Honour’
-
Entertainment1 week agoWhere Pete Davidson, Elsie Hewitt stand after breakup: Details revealed
-
Politics1 week agoRising diesel costs from Iran war strain US school budgets
-
Tech1 week agoWhy Is Your Grill So Dumb? The Best Grills Set Temp Like an Oven
-
Tech1 week agoThis Solar-Powered Smart Sprinkler Keeps My Lawn Watered Without Any Power Cables
-
Fashion1 week agoRMG trade bodies seek policy support from Bangladesh PM
-
Fashion6 days agoNigeria Kwara Garment Factory, KWS Garment Production Village ink pact
-
Sports1 week agoPakistan steady after Das ton | The Express Tribune
-
Entertainment1 week agoPrincess of Wales praised as ‘step ahead’ of royal family