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The effect of adult psychological therapies on employment and earnings: Evidence from England

Author

Listed:
  • Emma Sharland
  • Marta Rossa
  • Ted Dolby
  • Ekaterina Oparina
  • Rob Saunders
  • Daniel Ayoubkhani
  • Vahe Nifilyan
  • Klaudia Rzepnicka

Abstract

People suffering from common mental disorders (CMD) such as depression and anxiety are more likely to be economically inactive. Psychological therapies are highly effective at treating CMDs but less is known about their impact on long-term labour market outcomes. Using national treatment programme data in England, NHS Talking Therapies (NHSTT), with unique linkage to administration data on employment and census records, we estimated the causal effects of NHSTT on employment and earnings. Overall, completing treatment led to a maximum average increase of £17 in monthly earnings (year two) and likelihood of paid employment by 1.5 percentage points (year seven). Those 'Not working, seeking work' saw a maximum average increase in pay of £63 per month (year seven) and likelihood of paid employment by 3.1 percentage points (year four). Our findings demonstrate the economic benefits of treating CMDs, and how investing in mental health can impact labour market participation.

Suggested Citation

  • Emma Sharland & Marta Rossa & Ted Dolby & Ekaterina Oparina & Rob Saunders & Daniel Ayoubkhani & Vahe Nifilyan & Klaudia Rzepnicka, 2025. "The effect of adult psychological therapies on employment and earnings: Evidence from England," CEP Discussion Papers dp2070, Centre for Economic Performance, LSE.
    • Handle: RePEc:cep:cepdps:dp2070
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    References listed on IDEAS

    as
    1. Krekel, Christian & Srisuma, Sorawoot, 2024. "Talking Therapy: Impacts of a Nationwide Mental Health Service in England," IZA Discussion Papers 16839, Institute of Labor Economics (IZA).
    2. Gruber, Jonathan & Lordan, Grace & Pilling, Stephen & Propper, Carol & Saunders, Rob, 2022. "The impact of mental health support for the chronically ill on hospital utilisation: Evidence from the UK," Social Science & Medicine, Elsevier, vol. 294(C).
    3. Germinario, Giuseppe & Amin, Vikesh & Flores, Carlos A. & Flores-Lagunes, Alfonso, 2022. "What can we learn about the effect of mental health on labor market outcomes under weak assumptions? Evidence from the NLSY79," Labour Economics, Elsevier, vol. 79(C).
    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    mental health; employment; earnings; policy evaluation; psychological therapies;
    All these keywords.

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