A British generation that is too sick for work

January 24, 2008

Free Market Foundation

Weaning the long-term ill off welfare and into the workforce has long been an intractable problem in the United Kingdom, notes the Financial Times. It has its roots in the decline of the U.K. industrial base and coal mining communities, where doctors were tacitly encouraged to classify the out of work as sick rather than push up unemployment.

Indeed:

The Labour Party has had 10 years to come up with an answer; in that time, despite steady economic growth, the number of claimants has risen to 2.6 million.

The disclosure that more than half a million people under the age of 35 claim incapacity benefit, more than the number who qualify for unemployment benefit, is troubling.

It suggests a generation has grown up with little interest in work and even less incentive to find it.

To declare someone incapable if they tick the right boxes is a counsel of despair as much as an invitation to abuse, says the Times. Labelling claimants incapacitated contributes to unemployment. Detachment from the labour market can take its toll on people’s mental state. But being at work is almost certainly better for you than doing nothing at home.

The government is moving in the right direction, says the Times:

Revamped tests and a new employment and support allowance to be introduced in October will provide more support for people wanting to return to work and a rigorous assessment of their capabilities.

The Conservatives want to screen all existing claimants to assess their ability to work.

The problem with the government’s approach is that it only addresses numbers coming on to benefit. The slowdown in flows coming off benefit is the reason claimant numbers have risen, says the Times.

Source: Editorial, A generation that is too sick for work, Financial Times, January 6, 2008.

For text: http://www.ft.com/cms/s/0/41bac584-bc83-11dc-bcf9-0000779fd2ac.html

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Article_Category=17u>SA Comment:
SA labour laws provide a high level of job security to the employed and simultaneously constitute a significant barrier to entry into the job market, resulting in the unemployment of more than one third of the potential workforce. SA therefore has one of the worlds highest unemployment rates. Welfare support is incapable of alleviating the consequences of the labour policies and SA cannot afford UK-style support even if government were not deterred by the probable negative consequences as experienced in the UK.

FMF Policy Bulletin/ 15 January 2008