National, regional and local governments across the globe are struggling to control both the health and economic impacts of the Covid-19 pandemic. The policy choices they face are often depicted as a straight trade-off between health and the economy. The reality is not so simple. Losing a job or having education disrupted can damage people’s long-term health.
People in poor health have more limited opportunities to participate socially and economically, and poor health has been estimated to cost the UK economy £100bn per year in lost productivity. As such, people’s health and the economy cannot be viewed independently. Both are necessary foundations of a flourishing and prosperous society. Good health is not simply an output of a fair and thriving economy. It is a vital input into a strong and sustainable economy.
Policymakers can make conscious choices about the type of economy they promote and these choices will materially affect long-term health outcomes. In his recent speech to the Conservative Party Conference, the Prime Minister recognised the “chronic underlying problems” of the UK, highlighting issues including skills deficits, inadequate transport, a lack of homes, and people feeling ignored and left behind. All of these have implications for the nation’s health and have made the UK less resilient to the threat posed by Covid-19.
The pandemic has further exposed existing inequalities in health that have their roots in longer-term trends. A Health Foundation report, Mortality and life expectancy trends in the UK, showed that since 2011 improvements in life expectancy in the UK have stalled, and for certain groups they have gone into reverse. The Marmot Review 10 Years On, published in February 2020, found that regional and socio-economic differences in health are large and growing, with major implications for the nation’s wellbeing and economic potential. Men living in the most deprived 10 per cent of areas in England can expect to live 18 fewer years in good health than men living in the least deprived.
People living in the most deprived areas are also experiencing a higher risk of exposure to Covid-19, while existing poor health puts them at risk of more severe outcomes if they contract the virus. For example, ONS figures show that between March and July, those living in the most deprived areas of England were more than twice as likely to die of Covid-19 as those in the least deprived areas. Measures introduced to control the spread of the virus are also likely to exact a greater social and economic price on those who are already most disadvantaged. This in turn has long-term consequences for health and health inequalities in those areas.
Rebuilding the economy after the pandemic and pursuing the government’s levelling up agenda must be about improving health as well as the economy. The Health Foundation’s report, Using economic development to improve health and reduce health inequalities, produced jointly with the RSA and Demos Helsinki, outlines how more inclusive economies can promote people’s health and well-being. For example, in an inclusive economy, we would expect to see a strong focus on tackling inequality and the variation in outcomes between people and places. Citizens should be at the heart of decision-making to ensure services meet the needs of those who would most benefit from them. We would also expect to see wider measures of success that go beyond a traditional approach centred on GDP growth.
If the goal of levelling up is to reduce the inequalities between different parts of the country, there is a lot that can be done at regional level to build economies that work for everyone and enhance health. This includes:
- Promoting economic systems that work for groups at the sharp end of inequality by engaging communities and designing services to meet their needs.
- Including health and wellbeing in the measurement of economic success.
- Actively managing any technological transitions and responding effectively to economic shocks.
- Promoting standards of good work and encouraging wide labour market participation.
The report also presents case studies from the UK and around the world that offer examples of these principles working in action. For instance, we explored the case of Saarland, an old mining and steel region in south-west Germany. Compared to post-industrial regions of the UK and US, Saarland avoided much of the social trauma associated with deindustrialisation because the regional government supported a gradual transfer of workers, technology and skills to alternative sectors. A key factor in creating economic resilience to this transition was strong regional governance arrangements.
Another example is Scotland’s Centre for Regional Inclusive Growth – a partnership between government and academia – which has produced an inclusive growth diagnostic tool. This brings together data on health outcomes (such as life expectancy at birth) with indicators of economic performance (such as the number of businesses and total exports) to help local areas identify how inclusive their economy is and the needs of particular population groups. Its aim is to support local authorities in making evidence-based policy.
There are, of course, things that national government needs to do to support regions to level up as the country tries to recover from Covid-19. The government could target growth incentives towards sectors that contribute to sustainable development and growth in high-quality jobs. Now is also the time to develop new measures of government success that go beyond a traditional approach centred on GDP growth and place health at the centre, underpinned by a cross-government strategy to tackle inequalities.
Times of economic transition offer opportunities as well as risks. We have the chance to build back better by promoting more inclusive economies. The pandemic has forced us to hold a mirror up to our society and its strengths and weaknesses, showing us levels of pervasive and entrenched inequality that cannot be ignored any longer.
Improving health for all must now be a critical dimension of the government’s levelling up agenda. Failing to act now will only store up more problems for the future. It is the right thing to do, for our country’s health and for our economy.
To download the Health Foundation report, click here.