Think-tank points to hidden productivity cost of workplace sickness

Rising workplace sickness is costing UK businesses billions every year, with an estimated £25bn lost through presenteeism, according to a think-tank.

A paper by the Institute for Public Policy Research (IPPR), Healthy industry, prosperous economy, has found that the annual hidden cost of employee sickness has risen by £30bn since 2018, with £25bn of this due to lower productivity and the rest down to a rise in sick days.

Of OECD and European countries, UK employees are among the least likely to take sick days but are more likely to work when ill, the paper says. Staff lose an average of 44 days’ productivity because of working through sickness, up from 35 in 2018. They lose a further 6.7 days taking sick leave, up from 3.7 in 2018.

Working through poor health is more common among ethnic minorities, people in lower quality jobs and workers without formal qualifications, the IPPR says. Black or Asian people are twice as likely to work through sickness than white British people, it adds. 

The think-tank is proposing a plan to clamp down on businesses that harm health and scale up those that “create good health”. It includes a tax incentive for SMEs that commit to significant improvements in their workforce’s health. 

It also argues for a “do no harm” duty for employers, regulating them on health outcomes. A third proposal involves compulsory worker health reporting to help investors distinguish between health-orientated and health-harming businesses.

“Too often, UK workers are being pressured to work through sickness when that’s not appropriate – harming their wellbeing, and reducing productivity,” said IPPR senior research fellow Jamie O’Halloran. He blamed “bad workplace culture, poor management, financial insecurity or just weak understanding of long-term conditions among UK employers”.