Poor workforce health costs UK economy £241bn annually, Vitality research finds

Poor workforce health is costing the UK economy an estimated £241bn a year in lost productivity, according to research by insurer Vitality and RAND Europe.

The findings, published in Vitality’s Global Health Index 2026, put the annual economic cost at approximately 8% of UK GDP, equivalent to almost £7,000 per worker.

The research identifies presenteeism, where employees continue working despite health problems affecting their performance, as the principal source of lost productivity, rather than sickness absence.

Mental health was found to have the biggest impact. Workers identified as being at high risk of poor mental wellbeing are estimated to lose an additional 30.3 productive days annually.

The report found that 66% of UK workers experience moderate to serious psychological distress, although only a quarter report having a formal mental health diagnosis.

Younger employees are particularly affected, with more than 80% of workers aged 18 to 24 reporting moderate or serious psychological distress.

Among young women, 35% reported depressive symptoms, compared with 24% of men in the same age group. Workers aged 18 to 34 were also more than four times as likely to report serious psychological distress as those aged 55 and over.

The findings come amid growing concerns about economic inactivity linked to ill health. The Keep Britain Working Review, led by Sir Charlie Mayfield, estimated that around 800,000 more people were economically inactive because of health problems than in 2019, with that figure potentially reaching 1.4 million by 2030.

A separate review led by Alan Milburn found that more than one million young people were not in education, employment or training, raising further concerns about the relationship between health and labour market participation.

Despite the estimated economic burden, the Vitality research found that only around a third of UK employers provide counselling or mental health support.

Access to other workplace health services also falls below international averages. Just 20% of UK employees are offered employer-funded health insurance, compared with a global average of 33%, while 13% have access to health screening against an international average of 23%.

The findings highlight potential opportunities for occupational health providers, health insurers and employee wellbeing services as employers face pressure to address health-related productivity losses.

The report recommends automatic enrolment in workplace health programmes, greater board-level accountability for employee health and increased investment in management training.

It also identifies a nine-day annual productivity gap between employees who believe their managers support their health and those who do not.

Neville Koopowitz, global chief executive of Vitality, said employers needed to pay greater attention to the economic consequences of workforce ill health.

‘This is not people just being off sick, it is people at work, struggling with their health and wellbeing, most likely within organisations that do not measure the health, wellbeing and productivity challenges affecting their workforce,’ he said.

Koopowitz added that employers investing in understanding and addressing workforce health problems were seeing returns, while the cost of inaction was becoming increasingly apparent.

Christian van Stolk, deputy chief executive at RAND Europe, said employers’ reliance on sickness absence data risked understating the impact of poor health on business performance.

‘The evidence linking health and productivity is substantial, yet absence remains the measure that attracts most attention from employers,’ he said.

‘The findings from this Global Health Index suggest this risks overlooking the larger challenge of presenteeism, where productivity is affected while people remain at work. Left unaddressed, these underlying health issues can become a precursor to long-term absence.’

The report’s publication ahead of the Autumn Budget adds to debate over the role of employers, healthcare providers and government in addressing workforce ill health and its impact on UK economic growth.