Leaving work due to illness and injury is as damaging as becoming unemployed, and can damage spouses income too, according to new research.
The Institute for Social and Economic Research (ISER) in a survey of 10,000 individuals in 5,500 households, found a spiral of additional financial problems have a wider impact.
The research, commissioned by Unum, revealed more than 1 in 4 (28%) ill or injured people fall into poverty and one third are living in poverty within a year of leaving work.
If you leave work for health reasons:
• You are less likely to return to work than if unemployed. Just 1 in 4 people (24%) re-enter the workplace after 12 months compared with almost 50% of unemployed people
• You suffer a 25% drop in monthly household income[ii] vs a 28% drop for people who become unemployed[iii]
• You have a 10% chance of having problems meeting your housing payments vs 8% for unemployed people. 8% of people who leave work for health reasons will begin to have problems paying for their housing after a year vs 7% for people who are unemployed
• Leaving the workforce due to illness or injury is associated with a 60% probability of stopping saving
Jack McGarry, chief executive of Unum UK, said: "Every year, 1 in 100 people leave employment for health-related reasons and 76% are still unable to work a year later. Industry figures show that 9 out of 10 people don't have Income Protection."
Having to leave work due to illness or injury also has a damaging effect on the spouse or partner and the wider household:
• 15% of people leave work within a year of their spouse leaving work for health reasons vs 13% for those married to someone who becomes unemployed
• 28% of people with spouses who leave work for health reasons reduce their working hours in the first year and 37% have reduced them within two years
Dr Mark Taylor, one of the researchers who produced the report, said that findings about the impact of leaving work for health-related reasons on the wider household were of particular note:
"The spouses of this group of people are less likely to be employed and are more likely to leave work than those of people who become unemployed.
"We also find evidence suggesting that spouses who stay in work are affected.
"This indicates that health-related withdrawal from work has wider repercussions, and looking at the whole household gives us a much broader and clearer picture than looking at individuals in isolation."
