Workers (Economic Affairs Committee Report) - Motion to Take Note

Part of the debate – in the House of Lords at 1:25 pm on 8 February 2024.

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Photo of Lord Griffiths of Fforestfach Lord Griffiths of Fforestfach Conservative 1:25, 8 February 2024

My Lords, as a member of the committee that produced this report, I, too, thank our chairman, the noble Lord, Lord Bridges, who did an outstanding job, as well as fellow members of the committee. It was a very lively committee, as with other times when I have served on that committee—it has always been lively.

At this stage of the debate, much of what I might have liked to say has been said, but there are some points that I would like to draw noble Lords’ attention to. The noble Lord, Lord Skidelsky, is right in saying that the title, Where Have All the Workers Gone?, sounds a bit like a whodunnit. However, when you open the report, you are immediately thrown into the detail of statistics about the economics of the labour market, and you get down to the minutiae.

The first point that I make is that this is really a debate about economic growth, which matters enormously. It matters for the quality of the public services that we have and for the welfare state, as well as for defence and for future tax cuts. It matters for managing our national debt. Among economists, a lot of emphasis is given to public and private investment and labour productivity, but much less to the size and health of the labour force. The size and health of the labour force are crucial to growth. I very much agree with the noble Lord, Lord Layard, my colleague, that mental health is absolutely central to what we are discussing today.

The second point that I want to make is that I believe that this is a crisis. Having been on the committee that wrote the report and having taken an interest in this area, I was astonished to find the figures published by the ONS on Monday. Nearly 3 million people in this country are economically inactive because of long-term sickness. It is a very grim picture. In the section of the publication on economic inactivity, the ONS posed the question: “Do you want a job?” That might seem an odd question to pose, given that it has produced statistics on economic inactivity, with regard to people who are not looking for work. It says that 1.8 million people responded to that question very positively, which may be entirely made up of students—but I cannot help feeling that those who are suffering from long-term sickness are people who would really aspire to having a job, and they are actually quite disappointed because they do not have one.

The third point that I would like to make is that we started our report under the shadow of Covid. It is not clear to me that, as a society, we really understand what the longer-term effects of Covid really are. You see it in small ways. When you talk to schoolteachers, they tell you that Covid had such an impact that children today are much more casual about attending school. For example, we know that people coming to an office only two or three days a week has now become a norm.

The statistics seem to hide things, and we really need more data from the ONS on this subject. We do not have nearly enough data explaining the relevance of economic inactivity, and particularly mental illness, to growth. The question arises of what needs to be done. I would say the first thing is: do no harm. The last thing we should do is to get on a bandwagon that says, “Pull up your socks, start walking, find a job—any job you possibly can”. There is great temptation to do that when the public finances are in the difficult state that they are. Secondly, more immigration is not the answer. While it might be a net benefit initially to the public finances, there is the problem of social housing and that the people who come have partners, get married, have children, and need education and health services. There is therefore likely to be a cost later.

We must recognise the work done, not least by the LSE, emphasising that economic inactivity is not something new. We experienced it in the late 1970s and early 1980s, and at the start of Covid. Because sickness rates have been much higher among older and less skilled workers, especially those in manual occupations, policy—particularly for the over-55s—should be encouraging or creating apprenticeships, focusing on workers with fewer skills.

This really leads to the issue of mental illness. Recently, the Economist had a very interesting series of articles on this subject. One question it raised was, with so many campaigns on mental illness—which I think are a good thing—might it not lead people to conflate normal responses to life’s problems with mental health disorders? Clearly, mental illness is a serious problem in our society, and it is important that it has resources and research. However, on the other hand, it is important to find out why mental illness is as prevalent as it is at present.

I say to the Minister, in conclusion, that if we are to do something about people employing more people, we need to have business on side. The department was very complimentary about the report. What does he think the department can do now to make sure that work will prove a source of well-being for those with long-term illness?