Mental health pressures could cost £170bn, equivalent to 5% of UK GDP

• By 2030, almost one in three working-age adults (32%) in the UK may be living with a mental health condition
• Teenage mental health rates are projected to reach 64%, twice the adult rate, as the number of young people not in education, employment or training (NEETs) hits a five year high
• 63 days of healthy life lost every year for those with mental health conditions, valued at £298bn annually
• People with mental health conditions are 29 percentage points less likely to be working, giving the UK one of the strongest links between poor mental health and long term economic inactivity

Our global report, The Value of Mental Health, warns the UK faces a major economic and social crisis unless mental health support moves from simply diagnosing conditions to actively helping people to enter, remain in and return to the workforce.

The report reveals that by 2030 almost one in three (32%) working age adults in the UK are projected to be living with a mental health condition, giving the UK the highest rate of diagnosed mental illness among comparable high income economies. This figure is forecast to be twice as high (64%) among teenagers aged 15–19 within the next five years, raising fears about what this could mean for the future workforce.

Anxiety disorders (49%) and major depressive disorder (26%) account for the majority of diagnosed conditions, alongside other mental disorders (7%), dysthymia (4%), autism spectrum disorders (3%), ADHD (3%) and bipolar disorder (3%).

The widening employment gap

The largest economic impacts are not driven by short term sick leave, but by a widening employment gap. In fact, 98% of productivity losses are caused by reduced workforce participation.

The report reveals that the UK has one of the strongest links between poor mental health and long term economic inactivity, with employment rates 29 percentage points lower among people with a mental health condition (53%) compared with those without one (82%). In comparison, the gap in similar markets such as Germany and Australia is around 40% lower, at approximately 17–18 percentage points.

Persistently high rates of mental illness despite significant investment

The report shows that the biggest costs of mental illness often sit outside formal protection systems such as community social care. Across six countries analysed – Australia, Chile, Germany, Malaysia, the United Arab Emirates and the United Kingdom – the burden falls heavily on individuals, families and employers, through losses in wellbeing and productivity that can far exceed official mental health care spending.

Cost to the UK economy

In the UK, the economic value of wellbeing lost to mental health conditions is around seven times greater than what is spent on formal mental health services. The UK already invests 1.4% of GDP (around £42 billion) in mental health protection systems, such as community mental health teams (CMHTs), but this is clearly not sufficient.

Mental health related productivity losses are projected to exceed 5% of the UK’s GDP by 2030. This is equivalent to £170 billion a year and is far higher than the projected loss for other comparable markets: 4% of GDP for Australia, 3% for Germany, 2% for Chile, and 1% for both Malaysia and the UAE.

The report also measures effects on people, productivity and protection systems through to 2030, using metrics such as years of healthy life lost, workforce participation gaps and system level costs.

The impact of early diagnosis on Gen Z and teenagers

Mental health conditions in the UK are increasingly identified during adolescence and early adulthood, with 41% of 15 to 19 year olds suffering from an anxiety disorder – higher than any other market analysed.

While earlier recognition should bring clear benefits for treatment, there are worrying signs that this is not translating into young people who are ready to join the workforce. Currently, nearly one million young people (13% of those aged 16 to 24) are not in education, employment or training (NEETs) – the highest level in five years.

The government’s Keep Britain Working Review, in which Zurich UK is participating in the “vanguard” phase to help create a workplace health standard, showed that investment alone is not enough without early intervention and stronger education to work pathways. This report should be a wake up call to link mental health pathways to workforce participation and to strengthen early intervention in work through employer provided workplace health provision.

Peter Hamilton, Head of Market Engagement at Zurich UK, said:

“The rise in youth mental health care needs is the start of a wave that will shape the UK’s workforce for a generation. Early intervention is key, and it’s the only way to stop today’s challenges from becoming tomorrow’s crisis.

“We know that those who are off work for less than twelve months are nearly five times more likely to return than those off for longer, highlighting the need for rapid employer led intervention and structured return to work support. Unless we intervene, mental health risks will become a persistent drag on productivity, economic growth and social mobility.”

Sojan Joseph, MP for Ashford, Hawkinge and the Villages and Chair of the All Party Parliamentary Group on Mental Health, said:

“The rising rates of mental health conditions and high numbers of young people not in education, employment or training are deeply concerning, and the two are closely linked.

“Young people who are NEET are more likely to suffer from mental health conditions such as depression or anxiety, while also missing out on the social, structural and therapeutic benefits that education or work can offer. On top of this, the cost of economic inactivity is deeply concerning.

“As legislators, we have a duty to close the employment gap, cut the cost of economic inactivity, reduce mental health waiting lists and deliver parity of esteem between mental and physical health.”

Victoria Hornby, CEO of Mental Health Innovations, said:

“Mental ill health remains one of the leading causes of workplace absence, both short and long term. Many people living with mental ill health want to work but feel held back, whether through loss of confidence or harmful workplace experiences.

“We’re grateful to our organisation for its commitment to mental health and for the partnership that is helping ensure thousands more people across the UK can access support when they need it most.”

Our Value of Mental Health report is part of a series showcasing the value that can be preserved through approaches to mental health that support wellbeing, strengthen organisational performance and maintain resilient protection systems.

You can download the report here:

• https://www.zurich.com/insights/personal/the-value-of-mental-health