The causal impact of health status on labour market outcomes: consequences for individuals and households

University of Sheffield

  • Led by the University of Sheffield, in partnership with the University of York and VU University, The Netherlands
  • Will estimate the causal impact of health status on labour market outcomes, such as employment, productivity, wages and absenteeism, to inform policy aimed at maximising participation in employment through reducing the disability employment gap and sickness absence
  • Will use econometric techniques to provide new UK evidence on the relationships between health status and work outcomes
  • The project will run for 30 months from April 2018.

This research project led by the University of Sheffield will aim to shed new light on the causal relationships between an individual’s health status and work outcomes, such as employment, productivity, wages and absenteeism.

Work is a key route to financial security and psycho-social wellbeing, and is generally good for people’s health. But there can be adverse effects stemming from long hours, stress and job insecurity.

Health is an important determinant of employment, affecting a person’s chances of gaining employment and adequate reward.

Deterioration in health is often the catalyst for people leaving the labour market, and people with poor health have a much lower employment rate than the rest of the population. This impacts not only on individuals and households but employer performance, productivity levels and economic growth. With long-term conditions increasing among the working age population, strategies are needed to maintain health status and participation.

This project will involve establishing the role of physical and mental health on determining outcomes such as employment, hours and wages. It will also explore the influence of poor health on employer outcomes, such as productivity and absenteeism.

The project team will primarily use data from the UK Household Longitudinal Study and the Quarterly Labour Force Survey to analyse the impact of factors such as age, gender, job/contract type, health status and household type on the relationship between an individual’s health and their participation in work.  

Econometric techniques (applying mathematical and statistical models to test economic hypotheses) will be used to estimate these complex relationships.

The research team will work with the government’s Work and Health Unit and other stakeholders to ensure the outputs of the project can inform policy being developed to maximise participation in work in the context of issues such as the ageing population, extended working lives, increased prevalence of chronic disease and the need to reduce the burden of social security provision.

Contact information

For more information about this project, please  Jennifer Roberts, Professor of Economics, University of Sheffield.

Further reading

Quick guide

What makes us healthy?

This guide explores how a person’s opportunity for health is influenced by factors outside the health and social care system.

About this programme

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