25% of Working-Age Britons on Disability: Why Is the U.K. Paying Millions to Stay Home?

The Hidden Crisis: Unemployment and Economic Inactivity in the UK

In September 2022, former U.K. Prime Minister Boris Johnson claimed that unemployment had reached "lows not seen since I was about 10 years old." However, this statement overlooked a critical aspect of the labor market. While official statistics focus on those actively seeking work, they exclude individuals who are economically inactive—such as students, caregivers, or those with long-term health conditions.

This exclusion creates a distorted picture of employment trends. In reality, the number of people classified as economically inactive has surged by nearly 400,000. Additionally, there has been a significant rise in the number of individuals claiming long-term sickness benefits, signaling a growing trend of people leaving the workforce permanently.

The Scale of the Problem

Currently, one-quarter of the working-age population in the United Kingdom is out of the labor force. This figure is significantly higher than the 16.6 percent observed in the United States. Once someone becomes economically inactive due to health issues, their chances of rejoining the workforce within a year drop dramatically to just 3.8 percent. Every day, approximately 3,000 new individuals are added to the rolls of those receiving sickness benefits, bringing the total to around 4 million people.

These individuals, often referred to as "Britain's invisible people," represent a substantial portion of the population that is not contributing to the economy. According to a 2024 survey, a quarter of all Britons identify as disabled, marking a 40 percent increase over the past decade. This growing trend raises concerns about the long-term implications for both the economy and social welfare systems.

Mental Health and Economic Inactivity

One of the most alarming aspects of this crisis is the increasing role of mental health in economic inactivity. A report by the National Health Service (NHS) Confederation revealed that in 2021–22, over 63,000 people transitioned directly from education to being economically inactive due to long-term sickness. In 2002, mental and behavioral problems accounted for 25 percent of claimants, but by 2024, this figure had risen to 44 percent.

The Institute for Fiscal Studies highlights that more than half of the increase in disability claims since 2019 can be attributed to mental health or behavioral conditions. About 69 percent of those applying for sickness benefits cite depression, anxiety, or other mental disorders. For disabled working-age Brits, mental illness is now the leading issue, affecting 48 percent of recipients.

The Rise in Benefit Claims

Data from the TaxPayers' Alliance shows that in April 2025, 1.75 million people in England received enhanced personal independence payments (PIP), a significant increase from 734,136 in January 2019. PIP is designed to support individuals with disabilities, helping them manage additional costs. However, only one-sixth of PIP recipients are currently employed.

Some recipients receive benefits for seemingly minor conditions, including acne, constipation, obesity, and even factitious disorders. The largest increases in PIP claims have been for mental health conditions. For example, the number of claimants for autism rose from 26,256 in 2019 to 114,211 in 2025, while anxiety and depression claims increased from 23,647 to 110,075 during the same period.

The Welfare Trap

The financial incentives for staying on benefits are staggering. A person receiving incapacity benefits and PIP could earn up to £23,899 annually, which exceeds the minimum wage. When combined with housing benefits and universal credit, some individuals may receive as much as £27,354 without paying taxes. This creates a powerful disincentive for employment.

Amy, a 30-year-old mother from Keighley, exemplifies this dilemma. She receives long-term sickness benefits due to complex post-traumatic stress disorder, anxiety, and depression. Despite her desire to work, she feels trapped by the system. If she were to take a job, she would lose all her benefits, leaving her unable to support her child.

A System in Crisis

The welfare trap has led to a situation where taxpayers are funding over £120 billion annually in working-age benefits. This is financially unsustainable and morally troubling, as it places an unfair burden on society. It also represents a tragic waste of human potential, as many individuals are consigned to a lifetime of worklessness.

Politicians have struggled to address this issue. The Labour Party’s recent attempt to cut PIP faced strong opposition, resulting in a U-turn. This highlights the deep political challenges involved in reforming the welfare system.

Lessons for the United States

The U.S. faces similar challenges. The American welfare system costs over $1.2 trillion annually, encompassing more than 80 federal programs. Over time, the proportion of income earned through work by families below the poverty line has declined sharply. Pandemic-era benefits and expanded eligibility have further entrenched dependency, creating a cycle of poverty.

Almost half of the U.S. population lives in households where at least one person receives government benefits. This growing reliance on welfare raises concerns about the long-term impact on economic mobility and social cohesion.

A Call for Change

A system that discourages work and perpetuates dependency is neither compassionate nor sustainable. People should not be told they are too broken to work; instead, they should be empowered to reach their full potential. The crisis in the U.K. serves as a warning to the world: generous welfare policies must be carefully designed to avoid trapping individuals in a cycle of inactivity.