Health for wealth: decomposing the role of health on productivity in England using individual and population-level longitudinal data from the UK

Abstract Background The productivity gap between the north and rest of England is around £44 billion per year. There is a substantial health gap, with mean average life expectancy 2 years lower and increased morbidity in the north. This study estimated how much of the productivity difference between the north and rest of England can be explained by poor health. Methods An individual analysis used data from Understanding Society: The UK Household Longitudinal Study, an annual household survey of around 40 000 households from 2008–16. A macro-level analysis used longitudinal data from the Office for National Statistics and other sources at the local-authority level from 2004–17. Analysis was restricted to individuals of working age (18–64 years) without missing data. The outcome variable was productivity, measured at the individual level by employment rate and at local-authority level by gross value added per head. The key exposure variable was health, measured at the individual level by self-reported health, presence of a long-standing illness or impairment, and mental health measured by the general health questionnaire. At the population level, health was measured by mortality and the proportion of the working-age population claiming incapacity benefit as a proxy for morbidity. We used decomposition methods to estimate how productivity differences between the north and rest of England could be explained by health. Findings At the individual level, 33% of the regional differences in productivity between the north and rest of England could be explained by health. Poorer physical health contributed 24% to the regional differences and higher incidence of poor mental health contributed 9%. At the local-authority level, 30% of the productivity gap between the north and rest of England could be attributed to poorer health in the north, 17% by morbidity, and 12% by premature mortality. Based on these findings, if health were the same in both regions an additional £13·2 billion gross value added would be generated. Interpretation Health improvement focusing on the north of England can increase UK productivity and promote regional growth. Our findings are robust to different proxies of productivity. However, we cannot establish a causal relationship between health and productivity. Funding Northern Health Service Alliance.