The deeper reason so many people are health-related inactive

A quick post to highlight an important point by Paul Gregg, chair of the new Labour Market Advisory Board

A quick post for the time being, to quickly highlight something that you might have missed (I’ll finish off my post on what’s happened to welfare spending later this week, following up my last post, ‘is welfare spending ‘out-of-control’?’).

While there are some worrying noises coming out of the new Government about welfare, there’s also some really encouraging signs. One of these is the appointment of a new official Labour Market Advisory Board, chaired by Paul Gregg - someone I have a huge amount of time for.

Relatedly, Paul has been highlighting a crucial issue that I think nearly everyone ignores - which I wanted to make sure wasn’t missed.

Who is Paul Gregg?

Firstly, it’s worth briefly explaining why I think Paul’s appointment is a good sign - particularly for any readers who don’t know who he is.

Paul is known for his work on the New Deal with New Labour, as well as a crucial review in 2008 on personalised conditionality, which led to the creation of ESA. But by 2011 (and detailed in a 2012 talk), he was publicly critical of the way that his ideas were being implemented:

• He said that the new assessment (the WCA) was introduced without any trials or monitoring, leaving it “an iterative process based on how loud the scream is. And for vulnerable groups this is a stupid system to introduce.”

• He also said that by taking the ‘nasty strategy’ of trying to push people off benefits, this was counterproductively pushing people away from work. I myself have spent over a decade saying that the sense of threat leads people to ‘hunker down’ on benefits: I took this phrase directly from Paul.

This willingness to change your mind and speak out is something that I really admire. More broadly, he also got close to power, but tried not to be sucked in by it - to the extent of always wearing ‘my most ripped pair of jeans’ in meetings with Tony Blair, to create some distance.¹ While power is seductive to everyone (me included), I would say that he made more efforts to get close while upholding his independence than almost anyone else I know.

All of which is a good sign.

The largely ignored cause of inactivity

I say all this because Paul is also almost the only person drawing attention to the deeper reasons why so many people are claiming incapacity benefits. This reason can be summarised as, ‘the end of light work’.

As he puts it in a just-published Health Foundation thought paper, in an easily-missed passage:²

In the 1970s, a large number of men were employed on ‘light duties’.³ A combination of full employment, strong trades unions and a lot of male ill health related to industrial accidents or occupational health matters, meant that employers were willing to hold onto workers who were not able to work so much and were frequently absent. Hence, in that decade, around 90% of men were in work and economic inactivity due to health problems was low.

Then the 1980s’ recession hit. While some firms closed altogether, many shed large amounts of labour to reduce costs. Many older workers lost their jobs, including through early retirement packages, where employees were, in effect, passed on to pension schemes rather than remaining on the payroll. And, most relevant here, workers living with a health condition or disability were also heavily impacted and pushed out of employment.

As he goes on to explain, these people initially went on to unemployment benefits, before a more conditional approach (Restart) pushed lots of people onto incapacity benefits.

But the current problems are not just because of the end of light duties in the 1980s - Paul also points out the role of work intensification since.

Labour [the concept, not the party] is now used both more intensively and ‘just in time’ than before [citing this]. That is, employers expect workers to be fully functional when present and only present when actually needed (this is reflected, for example, in the use of zerohours and self-employment contracts). The use of workers on light duties and with frequent absences is far less tolerated.

What’s the evidence for this?

Like Paul, I have long been convinced that the decline of light work is crucial - we just don’t have jobs like lift attendants, cinema ushers, car park attendants, or the very common light duties in factories and coal mines that used to exist. These weren’t always great jobs, but they did help include disabled people in the labour market.

The trouble is, we have very little evidence on what happened. We know that male employment rates crashed in the 1980s, as I wrote about here. But no-one was collecting good data on the extent of light work in the 1970s. (As an aside: I’ve been thinking of doing a historical project on this for at least a decade - I don’t know if it’s viable, but let me know if you’d be interested in exploring it).

Still, there are many knowledgeable people that are convinced that the light work issue is crucial.⁴ Benefits agency staff in a DWP report on sickness and work from 2001 said “where are the light jobs?” and’ ‘there’s no such thing as light work any more”, with the researcher noting that “staff argue that jobs which used to fit this need (like car-park attendant) have no virtually dried up”. A senior person (Mark Pearson, Head of Social Policy) at the OECD told the FT in 2008,

In the past, companies would see it as their duty to keep long-time employees through to retirement even if they got sick - they'd have them mowing the lawn in front of the company headquarters, that sort of thing. Now, that's gone. Virtually nowhere would a company feel it was their duty to keep people in employment simply because of their long service, so it spits them out. And if they don't have other skills, if they aren't highly trained or highly motivated, they're not going to find another job.

We can’t undo the past. But in looking to reduce health-related inactivity, it reminds us that we need to focus on the world of work - which I’m confident that Paul and the wider Labour Market Advisory Board (including a range of brilliant people) will do.

And more than that, it frames the problem differently - it’s not about the increasing laziness and malingering of British people, but rather about a labour market that - despite ever-more talk of ‘EDI’ - has arguably become less welcoming to those who deviate from inflexible norms.

1. Paul gave me an (on-the-record) interview for my performing trustworthiness paper. In an early draft I tried to anonymise his story (because there was no need to name him), but other participants told me, “This is clearly Paul Gregg!”! So this behaviour was pretty rare in the New Labour era.

2. Paul made similar points speaking on a Resolution Foundation panel (see 37:40-), where he said, “The 80s recession caused a massive shakeout of that kind of labour, what I'll call 'work intensification' - work intensified, and intensification of work drives out people who are somewhat marginal in their capacity of work into economic inactivity”.

3. The bold text is not in the original text, and has been added by me to aid readability.

4. Written examples include Walker & Howard’s 2000 book (p174-177) and Feldman 1983. Feldman talks about “bight watchmen, guards, doormen, elevator operators, bootblacks, gardners in private households, real-estate agents”. But I’ve informally talked to various other people - particularly historians - who agreed.