Restoring the health of the United Kingdom’s working-age population to levels last recorded in 2014 could raise economic output by £57 billion, according to a Health Foundation report that places deteriorating public health at the center of Britain’s growth and fiscal challenges.

The estimated increase is equivalent to about 2% of gross domestic product. The think tank also calculated that better health could deliver a £72 billion improvement in the public finances through a combination of higher employment, stronger tax receipts and lower spending on the NHS and social-security benefits.

The figures represent modelled economic gains rather than an immediate cash return. Even so, their scale illustrates how health conditions can influence national output through labour-force participation, working hours, productivity, earnings and the length of people’s careers. The report argues that health should therefore be treated as an economic asset alongside infrastructure, skills and technology.

“A healthy labour force is also the engine that powers our economy,” the report’s authors said, arguing that health determines whether people can participate in employment, how effectively they work and how long they remain economically active.

The research found that healthy life expectancy — the number of years people can expect to live in good health — fell by two years during the decade to 2022-24. The UK was one of only five among 21 of the world’s richest countries to record a deterioration, according to the report.

Over the same period, the number of working-age people with a long-term health condition increased from 11.7 million to 15.7 million. That four-million rise does not mean every affected person has left employment, but it indicates a much larger share of the potential workforce is managing conditions that can limit hours, continuity of work or productivity.

David Finch, interim director of health and inequalities at the Health Foundation, said restoring working-age health to its 2014 level could unlock £57 billion in output and provide a £72 billion boost to the public finances through stronger revenues and lower expenditure on the NHS and social security.

The report broadens the usual economic discussion of ill health, which often focuses on people who are economically inactive because of long-term sickness. Its analysis also encompasses people who remain employed but work fewer hours, take repeated absences, experience reduced productivity or retire earlier than they otherwise would have done.

Those effects can accumulate across the economy. Employers face higher absence costs, more frequent recruitment and training expenses, greater demand for occupational-health support and disruption to production. Workers may lose earnings and opportunities for promotion, while periods outside employment can weaken skills and make a return to stable work more difficult.

The consequences also reach the public finances through several channels. Lower employment and earnings reduce income-tax and national-insurance receipts. Greater eligibility for health-related benefits increases government expenditure, while worsening chronic conditions create additional demand for medical appointments, hospital treatment, medication and social care.

This creates a potentially self-reinforcing cycle. Poor health restricts labour supply and tax revenue, limiting the resources available to improve healthcare and public services. Treatment delays can then prolong sickness absence, make conditions more severe and leave more people unable to return to work.

The Health Foundation’s analysis comes as Britain continues to confront weak productivity growth and tight fiscal constraints. A separate Resolution Foundation report published on July 16 estimated that an older and sicker population had added about £90 billion in annual spending pressures. It said worsening health had been as significant a fiscal factor as population ageing, with only about one-fifth of the health deterioration explained by ageing itself.

The Resolution Foundation also calculated that health-related expenditure now represents roughly £1 in every £4 of government spending excluding debt interest. That ratio demonstrates why governments cannot manage the fiscal consequences of ill health solely by changing disability-benefit rules or tightening eligibility requirements.

Benefit reform can influence incentives and determine how public support is distributed, but it does not by itself shorten medical waiting lists, prevent chronic illness or improve the capacity of workplaces to retain employees with health limitations. Policies focused only on reducing claims risk moving costs between departments without improving underlying health or economic participation.

The £57 billion estimate strengthens the argument for assessing healthcare interventions partly by their effects on employment and productivity. Faster access to diagnosis, mental-health treatment, musculoskeletal care and rehabilitation could produce economic benefits outside the NHS budget, including higher tax revenue and lower benefit expenditure.

That creates a challenge for conventional public budgeting. The department paying for preventive services may not be the institution that captures the eventual financial return. A local authority might fund public-health measures, for example, while the Treasury receives additional tax revenue and the national benefits system records lower expenditure.

Without coordination, programmes with positive long-term economic returns may be restricted because their immediate costs appear in one budget while their savings emerge later or elsewhere. The Health Foundation’s approach implies that investment decisions should account for these cross-government effects rather than measuring health programmes only by their direct clinical outcomes.

The report also emphasizes the importance of health inequalities. People living in the wealthiest 10% of areas can expect as many as 20 more years in good health than residents of the poorest 10%. That gap has economic implications for regional labour markets and the government’s efforts to spread growth more evenly across the country.

Areas with worse health may have lower employment rates, reduced household income and weaker consumer demand. Employers may find it harder to recruit and retain workers, while local public services face heavier demand supported by a comparatively narrow tax base. Poor health can therefore deepen geographic inequality even when infrastructure or business investment is available.

Finch said improved health was essential to delivering growth “in every postcode.” The phrase reflects the report’s conclusion that regional economic policy cannot rely only on transport projects, housing development or incentives for private investment. Local populations must also be healthy enough to participate in the opportunities those initiatives are intended to create.

The policy implications extend beyond hospital capacity. The Health Foundation argues for greater emphasis on prevention and public health alongside treatment. That could include measures addressing smoking, obesity, unhealthy food, alcohol-related harm, poor housing, air quality and limited physical activity, as well as interventions that improve mental health and reduce the progression of chronic disease.

Workplace policy is another potential channel. Employers can help people remain economically active through flexible schedules, phased returns, occupational-health services, job redesign and earlier intervention when health problems emerge. Smaller businesses, however, may lack the resources to provide extensive support without public assistance or access to shared services.

Health-related economic inactivity among younger people is a particular concern because its effects can persist for decades. A period outside education or employment early in adulthood can interrupt skills development and reduce future earnings. It may also make subsequent health problems and labour-market exclusion more likely.

The incoming government is expected to receive a report from former health secretary Alan Milburn on the approximately one million young people not in education, employment or training, many of whom face health barriers. A separate review led by Stephen Timms is examining disability-benefit reform, while social-care policy is also expected to move higher on the government’s agenda.

These workstreams will test whether ministers can align healthcare, employment support and benefit reform. A successful strategy would need to distinguish between people who can return to work with timely treatment or workplace adjustment, those whose capacity is limited but not eliminated, and those whose conditions prevent employment.

The Health Foundation cautioned that better health would not resolve every economic weakness and that not all illness can be prevented. Britain’s productivity problems also reflect low investment, skills shortages, infrastructure constraints, trade frictions and other structural factors.

There are also limits to translating modelled gains into budget forecasts. Restoring health to its 2014 condition would require sustained changes across healthcare, social care, workplaces and the wider social environment. Benefits would emerge over different time horizons, and some additional NHS spending might be necessary before reduced demand or higher tax revenue became visible.

The report nevertheless changes the framing of that spending. Health programmes are often treated primarily as costs that must be accommodated within a constrained budget. The modelling suggests that effective interventions can also expand the economy’s productive capacity, making them closer to investments in human capital.

For the Treasury, the £72 billion public-finance estimate is especially significant. Stronger employment would improve tax receipts without requiring higher tax rates, while lower demand for benefits and healthcare could ease pressure on departmental budgets. That combination would be valuable in an economy facing high debt, elevated taxes and limited room for additional borrowing.

The fiscal benefit should not be interpreted as guaranteed savings or as a reason to reduce current support before health outcomes improve. The result depends on successfully preventing illness, treating conditions earlier and enabling more people to enter or remain in suitable employment. Cutting expenditure without achieving those outcomes could instead worsen health and reduce economic participation.

The central message is that Britain’s growth, labour-market and fiscal strategies are increasingly inseparable from population health. The rise in long-term conditions is not confined to NHS waiting rooms or welfare accounts; it affects the number of workers available, the output they produce and the revenue the government can collect.

Restoring health to its position a decade earlier would be an ambitious objective. The Health Foundation’s £57 billion estimate, however, provides a measure of the economic opportunity available if policymakers can reverse even part of the deterioration. It also raises the cost of inaction: weaker growth, widening regional disparities and greater pressure on public spending as preventable or manageable conditions become more entrenched.