The referral to elective treatment waiting list in England has risen steadily since the onset of the pandemic, to 7.4 million treatments in April 2023. This box used waiting list and LFS data to estimate the effect on employment and inactivity of halving the waiting list by 2027-28.

Our analysis of disaggregated data on the NHS referral-to-elective-treatment waiting list in England, in combination with other data sources (set out in paragraph 2.18), suggests that the rising NHS waiting list itself is unlikely to have been a significant driver of rising inactivity due to long-term sickness in recent years. This stems from the fact that a large majority of those on the waiting list are either in employment or not of working age. We estimate that there were 2.9 million working-age adults on the NHS waiting list in 2022, of which around 1 million were inactive and 650,000 inactive due to long-term sickness (so around a quarter of the long-term sick inactive population). In addition, there appears to be limited correlation between changes in the waiting list by age and treatment group and recent rises in health-related inactivity. And the median duration on the waiting list is 15 weeks, making those on it a vastly higher-turnover group than those who are inactive due to long-term sickness.

Building on this analysis, we construct a stylised model to estimate the extent to which reducing the waiting list in England might contribute to higher employment and lower inactivity in our upside scenario. This model draws on the following data and assumptions:

  • We derive age-specific activity inflow and outflow rates for people with health conditions and those without from longitudinal LFS data. For example, for 45-54-year-olds, we estimate that 2 per cent of economically active people without work-limiting health conditions flow into inactivity each quarter (rising to 5 per cent among those with health problems); and 12 per cent of economically inactive people without health problems flow into activity each quarter (falling to 2 per cent for those with health problems).
  • We apply these flow rates for 15 weeks (the median time on the waiting list) to working-age adults on the waiting list disaggregated by age and labour market status – subtracting net activity inflows from outflows to derive an overall effect on working-age inactivity of the waiting list remaining at its current levels.
  • We then apply assumptions – informed by conversations with health experts – about the extent to which the treatments being waited for switch people from ‘sick’ to ‘well’ from a labour market flows perspective, ranging from 50 per cent for musculoskeletal and heart treatments, to just 10 per cent for treatments related to progressive illnesses and skin, sight, hearing and speech problems. We repeat the 15-week flow-rate exercise on the basis of these changed flow rates, to derive an overall effect on working-age inactivity were the waiting list to be eradicated entirely.
  • Finally, we apply an optimistic declining path for the waiting list over the coming five years – such that it halves from 7.4 million today to around 3.5 million in 2027-28 – a level last achieved in mid-2015 and similar to the most optimistic scenario included in modelling by the Institute for Fiscal Studies.a

Relative to the waiting list remaining at current levels, this modelling exercise suggests it falling by half would reduce working-age inactivity by around 25,000 in 2027-28. We have also tested some sensitivities around this estimate: for example, a more optimistic outlook for the extent to which treatments switch people from ‘sick’ to ‘well’ – where all treatments have a 50 per cent chance of doing so – would imply a reduction in inactivity of around 50,000. By contrast, a less optimistic outlook for the speed at which the waiting list falls – in which it reaches 5 million by 2027-28 – would imply a reduction in inactivity of only around 15,000.

This range of estimates suggests that the contribution of bringing down the NHS waiting list to raising participation is likely to be relatively small – contributing only around 5 per cent of the participation increase in our upside scenario on the central estimate. This reflects the estimated age, labour market status, treatment types, and duration of those currently on the waiting list, alongside the fact that many of the treatments being waited for appear unlikely to have a clear impact on work capability. And while the waiting list is high turnover, the labour market is not, so making someone ‘well’ several weeks earlier from a labour market perspective only has a limited impact on labour market aggregates based on observed flows rates.

This box was originally published in Fiscal risks and sustainability – July 2023

a IFS, Selected scenarios for waiting lists, February 2023.