by Richard Exell

Mr Cameron’s Milton Keynes speech about deficit reduction repeats a line that has become a common theme of speeches by Coalition politicians: one of the sins of the last government was “accepting as a fact of life the eight million people who are economically inactive.”

The implication is usually that this is a new low and always that it marks a tremendous failure of the last government. Where do we stand at the present?



According to the ONS, there are 38 million people of working age. Of these, just under 8.2 million are economically inactive – not in employment or self-employment, but not classified as unemployed either.

The main reasons why people are economically inactive are:

– Slightly over 2.3 million are students

– A bit under 2.3 million are looking after their family/home.

– Just over 2 million are long-term sick.

– Just under 600,000 describe themselves as retired.

Coalition politicians can point out that, in May 1997 there were 7,615,000 economically inactive people. In the latest figures, there were 8,166,000.

Enough said?

No. Throughout this period, there number of working age people was rising, sometimes very quickly. In fact, the number has risen every month since June 1993. When Labour was elected the working age population was just under 35.3 million; in the latest figures it is just over 38 million – 2.75 million higher.

A much more accurate basis for comparison is what proportion of people are economically inactive and here the story is different.

Two things stand out about these figures. One is that the increase in the number of students is more than enough to account for the whole increase in economic inactivity. We have nearly 900,000 more students now than in 1997 – I regard that as an overwhelmingly good thing and no-one who thinks otherwise has any right to label themselves as a “progressive”.

The other is that the number of people categorised as economically inactive because they are long-term sick is, despite the recession, still lower than it was in 1997. Conservative (and, nowadays, Liberal Democrat) bloggers and journalists who bang on and on about Britain’s army of shiftless malingerers never once mention this statistic.

Let’s have a look at what has happened to those major categories:

What we do get is endless comparisons with the number of sick and disabled people in 1979. I’d have said that that date was a bit of a give away, but again the representatives of the hard, unbending tendency in conservatism never point out that the tripling of the numbers of sick and disabled people happened under John Major and Margaret Thatcher.

Despite attempts to insinuate otherwise, there is no evidence that the last government tried to push people onto Incapacity Benefit to massage down the unemployment figures.

But it definitely was official policy during the 1980s and 90s recessions – talk to anyone who was a manager in the Employment Service or the DSS (forerunners of Jobcentre Plus) in those days and they will tell you that the standing instruction was that anyone on Unemployment Benefit who could qualify for a disability benefit was encouraged to switch.

In fact, its one of the more honourable things about the last government that, despite the terrible press they were getting for rising unemployment, they never did this.

It is one of the ironies of history that a government that brought down the number of people who were economically inactive because of sickness and disability will be remembered for letting the figures balloon. It is beyond irony that politicians who will probably be remembered as cynics who manipulated the employment figures were in fact the first for a generation who resisted that temptation.