Commenting on the Autumn Statement delivered by Chancellor Jeremy Hunt, Sarah Williams, head of employment at Taylors Solicitors, said:
“The chancellor has confirmed that the economically Inactive are a government challenge. These are people who are not in employment and who are not seeking work, or who are unable to start work. Society has mixed views about the economically inactive, Piers Morgan is of the view that in the UK “We have become a nation of lazy stay at home skivers, who’ve gone from can do to why the hell should we”, but others are more sympathetic.
Over the past decade, following the removal of compulsory retirement and the introduction of age discrimination, the numbers of older workers in employment, especially pre-Covid, was increasing. However, in June this year the Institute of Fiscal Studies (IFS) reported that there was a rise in economic inactivity among people in their 50s and 60s.
In his Autumn Statement the Chancellor said: “We have seen a sharp increase in economically inactive working age adults of 630,000 since the start of the pandemic. Employment levels have yet to return to pre-pandemic levels, which is bad for businesses who cannot fill vacancies and bad for people missing out on the opportunity to do well for themselves and their families.”
It is well-known that for some time the government has been considering how to encourage this section of society to return to work, but the government must remember that people become economically inactive for various reasons.
In its report, the IFS states that, during the pandemic, redundancies across the 50s and 60s increased, whilst surprisingly ill-health as the overall primary driver for economic inactivity remained consistent both pre-and post-pandemic.
What is clear is that people become economically inactive for various reasons. In any society, there are always people who fall into the Piers Morgan camp, those who try to play the system or who don’t want to work, but there will also be people who were forced to leave employment during the pandemic and, quite simply, don’t claim benefits and have learned how to cope. For example, grandparents and carers of children or others, and those who have found other interests, or have decided to enjoy a different lifestyle.
The government has confirmed that we are in a recession. There will be more redundancies, and forcing too many economically inactive back into work could backfire as this could impact negatively on those individuals who do want to work. In these months and days ahead, it will be interesting to see how this issue unfolds.”
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