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Prioritising health and wellbeing is important for the individual and the economy

The ‘people’ or human capital contribution to the fragile economic recovery will rely on three key assets. They are: the skills base of the workforce and employers’ capacity to make good use of it; the level of engagement felt by the workforce and their willingness to ‘go the extra mile’; and the health and wellbeing of the workforce and its impact on productivity.

Sadly, in October several studies were published that painted a gloomy picture of the UK's performance in each of these domains.

Much of my own time last month was taken up with the workforce health challenge, both here and across the EU, where a combination of ageing, later retirement and a growth in chronic ill-health is adding up to a looming crisis over the next two or three decades.

Across the EU the political debate about workforce health is dominated by the need to reduce welfare costs. This tends to result in an unhelpful focus on eligibility for benefits, 'workfare' and divisive assessments of 'fitness for work'. Often, this means we forget what much of the evidence suggests, namely that being in work can support and improve individual health.

In the UK, every day 822 people move from long-term sickness to a benefit related to ill-health. It is essential that policymakers grasp the opportunity to reduce the healthcare and welfare burden and boost competitiveness. So, prioritising job retention and return-to-work outcomes is important for both the individual and economy.

In a time of austerity, it is inevitable that priority is given to reducing healthcare and welfare costs. Given that only 3% of EU health budgets fund prevention, the cost pressures to avoid tackling the underlying health conditions in the working-age population should be hard for politicians to resist.

So, when The Work Foundation organised a conference in Brussels called 'Investing in Healthcare: Breaking Down the Silos', as part of our Fit for Work Europe project in mid-October, we knew we were trying to push water uphill.

The event brought together policymakers and practitioners from healthcare, welfare, finance and employment to explore a multi-agency response to improving workforce health.

Yet it remains conventional practice in the EU for Government departments to focus only on the specific areas for which they are responsible. This leads to a 'silo' mentality, where healthcare spending decisions centre on meeting immediate needs for treatment, rather than on longer-term prevention or early intervention.

An important issue to confront is that no single stakeholder has a compelling incentive to invest in interventions to improve workforce health because of the way the costs and benefits of such investments accrue. The costs of ill-health in the working-age population are shared across several stakeholders, such as employers, the healthcare system, the social security/social insurance budget, individuals and their families.

This means that the impeccable logic of investing in workforce health is rarely sufficiently compelling to overcome the pressure to control or reduce immediate financial commitment. Not to mention the political risk involved in making an investment that will not yield a return until after the next election.

While we are caught in this logic 'trap', it seems unlikely that we will find it easy to take the long-term view of workforce health that we so desperately need.

Stephen Bevan (pictured) is director of the workforce effectiveness centre at The Work Foundation