A new study out this morning forecasts that NHS England’s long-term workforce plan, estimates that the NHS in England will need around 60% more staff by 2036–37. I
If such an increase is delivered, that could plausibly mean that in England, almost half of public sector workers, and around one in eleven workers overall, would be employed by the NHS.
The findings of new research from the Institute for Fiscal Studies, published today as a pre-released chapter of the 2023 IFS Green Budget says that the workforce plan implies annual NHS budget increases of around 3.6% per year in real terms (or 70% in total by 2036–37).
This would be in line with the long-run average real-terms growth rate in UK health spending (3.6% per year from 1949–50 to 2022–23), but higher than the 2.4% per year seen since 2009–10.
In other words, returning to the NHS’s long-run average funding growth rate could be enough to fund the workforce plan.
By the NHS’s own estimates, though, this will only be enough to meet NHS demand if productivity can be increased by between 1.5% and 2% per year: an extremely ambitious target well above what the NHS is estimated to have achieved in the past.
Max Warner, Research Economist at IFS and an author of the research, said:
‘The publication of the NHS workforce plan and its detailed workforce projections is an important and welcome milestone for the NHS. We estimate that the plan might imply average real-terms funding growth of around 3.6% per year for the NHS in England. That is by no means outlandish by historical standards, but would nonetheless require difficult fiscal decisions in the current climate of sluggish growth.
‘NHS modelling suggests that even these large staffing increases will only be “enough” to meet future demand if staff productivity can be increased by a highly ambitious 1.5% to 2% per year. The risk of having a workforce plan but no similarly high-profile plan for capital, technology or management is that higher spending on staffing squeezes out other vital inputs, and makes those productivity gains all but impossible to achieve.’
