Introduction

Deprivation and income are important influences on health. Levels of disposable income affect our ability to meet basic needs – the way we live, the quality of the home and work environment, and the ability of mothers to provide the kind of care they want for their children. The relationship between health and low income exists across almost all health indicators.1The outcomes associated with low family socioeconomic status include poor maternal nutrition, infant mortality, low birth weight, childhood injuries, child mortality, dental caries in children, malnutrition in children, infectious disease in children and adults, health care services use, chronic diseases in adulthood and excess mortality. The risk associated with poverty is two-fold:

  • People living in poverty are more likely to be exposed to conditions that are adverse for development (e.g. crowded or slum living conditions, unsafe neighbourhoods, etc.).  
  • People living in poverty are also more likely to be negatively affected by these adverse conditions.

From the late 1960s, Professor Sir Michael Marmot studied the effect of income on health in the Whitehall Studies I and II. He found a strong inverse relationship between position in the civil service hierarchy and death rates. Those in the lowest grade had a death rate three times that of those in the highest grade. The explanation could not be poverty or unemployment as all people in the study were employed. This led to further research that established that it is not absolute poverty but relative poverty that has a strong influence on health (see graph below).23

If full employment were achieved in Britain, 2% of lives would be saved per year and 17% of deaths in areas with higher than national average mortality would be avoided (see table below).4

Lives saved with full employment – Population aged 16-64.

  Men % Women % Total %
Lives saved 2,090 3 414 1 2,504 2
Lives saved in areas of excess mortality 1,432 21 270 8 1,702 17

 

Research shows that labour force participation is important for reasons that go well beyond earning money; employment matters for social inclusion, physical health, and psychological wellbeing. Losing a job undermines mental health, as it represents not just a loss of income, but also a loss of identity, status, structure and social support.

 

Summary

In Great Britain, 70.9% of the population aged 16-64 years were in employment (April 2012- March 2013), and 7.81% of those who were defined as economically active were unemployed. In London the level of employment was lower, at 69.5%, with 8.9% of the economically active unemployed. Employment levels were slightly higher in Merton than the London and national levels. In Merton, 72.6% of the population aged 16-64 years were in employment, with 7.1% of the economically active unemployed. There has been an increase in unemployment since 2008. In Merton, 3,455 people were claiming Jobseeker’s Allowance (as of August 2013), representing 3.3% of the resident population aged 16-64 years. As of September 2013, the percentage of claimants has been lower than the London (3.4%) and lower[higher?] than England (3.1%) levels, and levels have been falling since March 2013. The proportion of working age population claiming the key out-of-work benefits peaked at 8.2% in August 2009, fell back to 7.5% in November 2010 and was 9.5% in February 2013; an increase of +1.7% when compared with February 2012. These levels are much lower than the levels for London (13.2%) and Great Britain (14.3%).

In London, excluding the City of London, the median gross weekly pay for all fulltime workers varied from £789.80 in Kensington and Chelsea to £544.00 in Brent. The median gross weekly pay in Merton was 14th highest of the London boroughs (based on 32 boroughs, with the City of London excluded due to the small number of residents) at £535.50. In general men work in higher paid jobs than women, even when considering full time work.

Gaps and commissioning recommendations

Those in employment enjoy better levels of health than the unemployed. Unemployed people are significantly more likely than employed people to have poorer mental and physical health including depression, anxiety and physical health problems. Helping local people to be productive in either paid or unpaid work to support their transfer towards future employment will have a beneficial effect on demand for health services in the future.

Policies and programmes that increase levels of employment will be of significant health benefit to individuals and the local community. For young families, access to affordable day care and family friendly employment can also make a critical difference to being able to work. Meaningful employment for young people, such as apprenticeships, is particularly important to reduce the risk of depression and other mental health problems.

With the introduction of increased university fees and the possible increase in young people looking for work and training rather than further education, the development of employment schemes for young people is a particular priority.

The health impact of the recession is unknown. Possible early indicators include prescribing rates for antidepressants, A&E attendances (linked to late presentation), increase in obesity in adults and children (linked to poor diet) and claimant count. The London Health Observatory (now part of PHE) is working on developing measures to reduce the impact of the recession on health. Work needs to be done in partnership to try to mitigate the impact of the recession on health and wellbeing.

 

Key facts on employment and economic wellbeing in Merton

In Great Britain, 70.9% of the population aged 16-64 years were in employment (April 2012- March 2013), and 7.81% of those who were defined as economically active were unemployed. In London the level of employment was lower, at 69.5%, with 8.9% of the economically active unemployed. Employment levels were slightly higher in Merton than the London and national levels.

In Merton, 72.6% of the population aged 16-64 years were in employment, with 7.1% of the economically active unemployed. There has been an increase in unemployment since 2008. This trend is visible in the graph below.

Occupations and qualifications

The occupations of those who are employed are broken down into four major categories: managers and professionals; administrative, secretarial and skilled trades; personal service, sales and customer service; and machine workers and elementary occupations.

The distribution of occupations in Merton was close to the London distribution (professional and managerial: 54.4% Merton, 55.4% London; administrative and trades: 17.8% Merton, 18% London; service and sales: 14.1% Merton, 14% London; machine workers and elementary: 12.7% Merton, 13.4% London)

Income and pay

Gross weekly pay is a measure of the kind of work that people who live in Merton undertake, and is related to the deprivation of the borough overall. In general, wealthier areas attract residents who have higher paid jobs. In London, excluding the City of London, the median gross weekly pay for all fulltime workers varied from £789.80 in Kensington and Chelsea to £544.00 in Brent. The median gross weekly pay in Merton was 14th highest of the London boroughs (based on 32 boroughs, with the City of London excluded due to the small number of residents) at £535.50.

In general men were working in higher paid jobs than women, even when considering fulltime work. The range in median gross weekly pay for men varied from £854.90 (Kensington and Chelsea) to £550.70 (Newham). Median gross weekly pay for men in Merton was £547.20 (11th highest in London). For men, 79.9% in Merton were in employment, higher than in London overall at 76.5% and Great Britain (76.1%).

Median gross weekly pay for women varied from £678.70 (Richmond) to £501.60 (Barking and Dagenham). For women particularly, the median gross weekly pay will be affected by the extent to which those women in less deprived circumstances, who might be expected to work in better paid jobs, are economically active, rather than at home. Median gross weekly pay for women in Merton was £518.30 (15th highest in London). In Merton, 68.4% of women aged 16-64 years were in employment, higher than in London overall (62.3%) but lower than in Great Britain (65.8%).

Unemployment

Jobseeker’s Allowance (JSA) is paid to those who are out of work, capable of, available for and actively seeking work during the week in which the claim is made. The maximum weekly allowance for single people is £56.80 for those under 25 years of age and £71.70 for those aged 25 and over, up to pensionable age. The amount paid may be less depending on any income and savings.

In Merton, 3,455 people claimed Jobseeker’s Allowance (JSA) (as of August 2013), 3.3% of the resident population aged 16-64 years.

As of September 2013, the percentage of claimants has been lower than the London (3.4%) and lower than England (3.1%) levels, and levels have been falling since March 2013. (see graph below)

 

In Merton, the highest percentage of JSA claimants as a proportion of the resident population of the same age were those aged 18-24 years For this age group, 4.4% claimed JSA compared with 5.1% for London and 5.8% in England.

The percentage of claimants as a proportion of the older age groups was slightly lower; 2.3% (aged 25-49 years) and 2.1% of those aged 50-64 years were claiming JSA. In London, 3.3% aged 25-49 years and 3% aged 50-64 years were JSA claimants. For England the levels were 3.3% aged 25-49 years and 2.0% aged 50-64 years.  

The distribution of unemployment across the borough may be seen from analysis of JSA claimants at ward level. There are higher percentages of claimants in Cricket Green (4.8%), Pollards Hill (4.7%), and Figges Marsh (4.1%), with low percentages in Village (0.5%), Dundonald (0.9%) and Hillside (0.9%).

Benefits

Other benefits are available to working-age people from the Department for Work and Pensions, although the Government has signalled its intention to rationalise the range of different types of benefit available to any one person or household. The key current benefits available in January 2013 were: bereavement benefit, carer's allowance, disability living allowance, employment and support allowance (ESA) and incapacity benefit, severe disablement allowance, income support, and jobseeker's allowance. The proportion of the population aged 16-64 years who claimed the wider range of benefits was much higher than those who claimed JSA alone.

In Merton, the proportion of working age population claiming the key out-of-work benefits peaked at 8.2% in August 2009, fell back to 7.5% in November 2010 and was 9.5% in February 2013; an increase of +1.7% when compared with February 2012. These levels are much lower than the levels for London (13.2%) and Great Britain (14.3%).

The big increases in unemployment nationally in 2008 and 2009 associated with the recession stabilised in 2010-11 and there are signs that unemployment is going down with the exception of those aged 24 or below.

In addition, people who are without work and on low incomes will experience a greater impact from the level of inflation (consumer price index) which was 2.7% in August 2013 2012, compared with 2.2% in September 2012.

Both food and heating costs have increased, with the cost of home energy doubling since 2004, with the average annual household bill standing at £1,132 in July 2011. The increased cost of living increases stress and poorer mental and physical health of people who are without work.

16-18 year olds not in education, employment or training (NEET)

Non-participation of young people in education, employment or training between the ages of 16 and 19 is a major predictor of later unemployment, low income, depression, involvement in crime, and poor mental health. This was recognised in the Marmot Review ‘Fair Society, Healthy Lives’,5which proposed an indicator to measure young people not in education, employment or training in order to capture skill development during the school years and the control that school leavers have over their lives. This indicator is therefore a wider measure than just youth unemployment as it also includes young people who are not being prepared for work.

 

16-18 year olds not in education, employment or training by London borough, 2012.

 

In 2012, Merton’s NEET (16-18 year olds) figure was 4.64% compared with 4.50% for London and 6.13% for England. Merton’s NEET figure shows a downward trend with a reduction from 5.6% in 20096. Merton ranked 14th in London boroughs where 1 is the highest percentage and 32 the lowest.7

Latest local data shows Merton’s NEET figure at July 2013 was 5%.  

Of the NEET cohort 55% were young men; 22% were aged 18; and 67% were white. Significant totals for ‘vulnerable groups’ include those with learning difficulties and disabilities, and those who were teenage mothers, who represented 5.7% and 11% of the total NEET group respectively.

The highest concentrations of the NEET cohort were in the east of the borough with the highest being in the wards of Cricket Green (8.8%) and St Helier (6.1%) and the lowest being in Village (0.6%) and Wimbledon Park (1.4%).

 

Key policy issues

Impact of welfare reform

The Welfare Reform Act 2012 is one of the largest policy changes to be introduced by the Government. The Act has been designed to deliver a £18 billion saving from the welfare budget as announced in the budget and spending review of 2010. There are likely to be significant economic implications of the Act for:

  • Individuals and families, which include:
    • Looked-after young people and care leavers
    • Foster carers
    • Adults with physical or learning disabilities or mental health difficulties
    • Larger families and those with dependent children
    • Older people
  • The local economy:
    • If households have less income, there will be an impact on the local economy.

In Merton it has been estimated that 309 people will be affected by the total benefit income cap and 958 claimants by the changes to housing benefit under occupancy. A reduction in benefits may result in higher incidences of homelessness, higher levels of fuel poverty as well as limiting the ability to make healthy lifestyle choices.

The mitigation of the adverse impact of welfare reform depends on the creation of employment opportunities and their take up by the population of Merton.

 

Gaps and commissioning recommendations

Improving employment chances

Those in employment enjoy better levels of health than the unemployed. Unemployed people are significantly more likely than employed people to have poorer mental and physical health including depression, anxiety and physical health problems. Helping local people to be productive in either paid or unpaid work to support their transfer towards future employment will have a beneficial effect on demand for health services in the future.

Policies and programmes that increase levels of employment will be of significant health benefit to individuals and the local community. For young families, access to affordable day care and family friendly employment can also make a critical difference to being able to work. Meaningful employment for young people, such as apprenticeships, is particularly important to reduce the risk of depression and other mental health problems.

With the introduction of increased university fees and the possible increase in young people looking for work and training rather than further education, the development of employment schemes for young people is a particular priority.

The health impact of the recession is unknown. Possible early indicators include prescribing rates for antidepressants, A&E attendances (linked to late presentation), increase in obesity in adults and children (linked to poor diet) and claimant count. The London Health Observatory is working on developing measures of the impact of the recession on health. Work needs to be developed in partnership to try to mitigate the impact of the recession on health and wellbeing.

 

Clarification of above information

  • Labour market, employment and qualifications are for 2012 and 2013 Source: www.nomisweb.co.uk
  • All figures for Job Seeker’s Allowance claimants are for February 2013 Source: www.nomisweb.co.uk
  • Figures are based on the above and London Health Programmes Health Needs Assessment (HNA) Toolkit

References

1. ^ London Health Observatory. Determinants of Health.

2. ^ Wilkinson, R. and Pickett K. (2009). The Spirit Level: Why More Equal Societies Almost Always Do Better. Allen Lane Penguin Group.

3. ^ Wilkinson, R. and Marmot, M. (2003). Social Determinants of Health: the Solid Facts. Second edition. WHO.

4. ^ Mitchell, R. et al. (2000). Inequalities in life and death. What if Britain were more equal? Joseph Rowntree Foundation.

5. ^ Marmot, M. (2010). Marmot Review ‘Fair Society, Healthy Lives’. University College London, Institute of Health Equity.

6. ^ Department for Education/Child and Maternal Health Observatory (PHE).

7. ^ London Health Programmes and Department for Education, 2013.