One in four young people are considering leaving the workforce completely as Labour has been pushing on with benefit cuts.
The most frequent reason cited for this decision by under-25s was poor mental health.
Meanwhile, one in 10 workers are actively considering leaving work, equivalent to 4.4 million people.
18 to 24-year-olds are 40 per cent more likely to give the reason of poor mental health for quitting their jobs.
18 to 24-year-olds are 40 per cent more likely to give the reason of poor mental health for quitting their jobs
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Liz Kendall, the Work and Pensions Secretary, has been working to freeze PIP to address the spiraling welfare bill, however these plans have now stopped.
Official numbers have revealed that 9.3 million people - a fifth of the working age population - were “economically inactive” at the end of 2024.
2.8 million of those are unemployed due to long-term illnesses, including mental health.
According to the Institute for Fiscal Studies, in 2024, the number of people receiving disability benefits with their main condition being behavioural or mental hit 44 per cent, compared with 40 per cent in 2019 and 25 per cent in 2002.
Many of these are young people who go straight from education to unemployment, with some concerned this could consign them to a life on benefits.
At the same time, costs of sickness and disability benefits for working-age people have skyrocketed by £20billion since the Coronavirus pandemic.
The PwC report also found that around 57 per cent of employers said they would be worried about hiring someone who is economically inactive.
Marco Amitrano of PwC said: “As well as the cost to individuals, businesses are understandably concerned about the direct impact on productivity and financial performance.”
Liz Kendall, the Work and Pensions Secretary, has been working to freeze PIP to address the spiraling welfare bill, however these plans have now stopped
PA
“Much of the current conversation focuses on how to get people outside the workforce back in, equally important is stemming the flow leaving the workforce in the first place.”
Speaking to the BBC, Streeting said: “Mental wellbeing, illness, it's a spectrum and I think definitely there's an overdiagnosis but there's too many people being written off and... too many people who just aren't getting the support they need.”
He added that the scale of the problem was large, with three million people shut out of the labout market due to long-term illness.
“That's a population the size of Greater Manchester,” he said.
A government source said: “The broken welfare system we inherited is trapping thousands of people in a life on benefits with no means of support, or any hope for a future of life in work.
“Our reforms will deliver fairness and opportunity for disabled people... protecting the welfare system so it is sustainable for the future and will be there for those who need it.”