Policy Library

While many people will never be able to work for reasons of poor health, disability or caring responsibilities, it is a profound social injustice to effectively write off the many thousands who are on sickness benefits but want to participate in employment.

The ONS Labour Force Survey estimates there are 138,500 Scots who are economically inactive but keen to work – trapped in the worst of both worlds. At a time of employment vacancies and labour shortages, failing to help this group take advantage of the opportunities in our economy is a dereliction of duty in any fair and just society. The Covid-19 pandemic and war in Ukraine sent inflationary shockwaves throughout the global economy. With the price of energy and goods continuing to rise, and the pressure on household budgets emerging as the number one public concern, the cost of living crisis is set to shape the imminent General Election and Scottish Government elections in 2026.The recent convulsions in Holyrood are as much a reflection of the parlous financial state of the nation as they are the internal machinations within the SNP.

At the Centre for Social Justice we have long argued that work is the best route out of poverty. With Universal Credit at its core, Britain’s welfare system is now one of the most advanced in the world – and successive governments have made progress in reversing the ‘poverty trap’ that people found themselves in under the old system, smoothing the journey from welfare into work for millions. But there is much more to do – and much more in Scotland where its devolved powers are struggling to halt the tide of those falling out of work and into welfare. 

When looking at the Scottish labour market, MSPs often only report the headline unemployment figure – those who are out of work but actively looking for a job. This ignores the large number of people who are categorised as “economically inactive” with no requirement to seek work, often due to long-term sickness, caring responsibilities, or early retirement. For example, in Scotland in November 2023, the unemployment figure was 124,894 compared to the far higher economic inactivity figure of 755,000. High rates of economic inactivity are associated with higher rates of welfare expenditure, a loss of tax revenue and increased expenditure on support services such as the NHS. It is bad for the individual, their family and community too. It means thousands missing out on the social, financial and health benefits of employment.It means children growing up deprived of the advantages of a home-life shaped by parents going out to work. And it means the economy leaving the immeasurable potential in our communities untapped. In 2017 the Scottish Government developed a new programme to provide employment support for disabled people and those at risk of long-term unemployment.“No One Left Behind” (NOLB) aims to provide a more tailored approach to the needs of people who want help and support to find employment – including those with health conditions and disabilities. The scheme was designed to encourage Scottish and local government to work together with public, charity and private sector partners to respond to local needs.

But while there is welcome evidence to show that some of those on the scheme have benefited from the support it offers, the data also reveals its low take-up. In the four years from 2019, just 39,632 people have received support with only 10,745 helped out of economic inactivity. A recent evaluation of NOLB in August 2023 revealed problems with low awareness and funding for charity providers. The Scottish Government urgently needs to reboot its strategy to help people who are economically inactive – yet wanting to work – find employment.