New study finds ending the sale of tobacco will create new jobs and boost the economy

A new study, conducted by Landman Economics on behalf of Action on Smoking and Health and part-funded by SPECTRUM, finds an additional bonus to the British economy of creating a smokefree country. [1]

On the eve of MPs voting to phase out the sale of tobacco to the next generation, the study finds that getting people to buy goods and services other than tobacco would create tens of thousands of new UK jobs. If the Government’s ambition of a smokefree country were to be achieved, then there would be 135,000 more FTE jobs in the UK economy worth almost £10 billion. The most recent estimate from the tobacco industry in 2017 estimated that 5,000 UK jobs were dependent on tobacco. [2]The reason for the dramatic increase is that most products and services purchased create jobs in the economy through production, manufacturing or providing services. However, there is almost no tobacco production in the UK and very few other jobs which are reliant on the tobacco industry. Therefore, when people buy something other than tobacco, it stimulates more growth in the economy than if they continued to purchase tobacco. 

Economist Howard Reed, who led the analysis, said:

Few would consider reducing smoking as having a direct impact on the country’s growth strategy, but plainly this analysis shows that reducing consumption of tobacco can have major benefits to society beyond improving health. What is more, switching spending away from tobacco can have a very rapid impact on job creation, whereas some of the health benefits can take many years to be seen.

Economist Dr Rob Branston, Associate Professor at the University of Bath, said:

Tobacco is a bad deal for the British economy in so many ways, from the drain on public finances through the excess illness it causes, to the damage it has on productivity by making people too sick to work. But it is also bad for British jobs, with spending on nearly anything else better for the health of our economy. Reducing smoking, as the government plans to do, is a double win – good for health and good for growth.

Hazel Cheeseman, Chief Executive of Action on Smoking and Health, said:

Tomorrow MPs will take a historic step when they vote in support of the Tobacco and Vapes Bill, and they should do so in the knowledge of the many benefits it will gift future generations. The phased-out sale of tobacco will unlock potential for the next generation not only by keeping them healthy but also ensuring there are more jobs and a healthier economy

As part of the analysis, researchers assessed the likely impact across the country, estimating how great the jobs bonus would be in different parts of the country as smoking rates fall. If the sale of tobacco was eliminated, then millions would be returned to local economies. 

 

Table: Regional breakdown of employment impacts, 2024  Based on regional split of tobacco spending

RegionTobacco spend (£m)PercentageEmployment impact (headcount)Employment impact (FTE)
North East171.34.1%7,5445,518
North West332.07.9%14,61910,692
Yorkshire and the Humber320.67.6%14,11710,325
East Midlands270.46.4%11,9068,708
West Midlands494.811.7%21,78715,935
East of England288.26.8%12,6909,281
London459.710.9%20,24114,804
South East545.612.9%24,02417,571
South West483.911.5%21,30715,584

 

Read the report in full here.

 

 

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