Objectives To assess, using individual level data, how the proportion of people in different employment statuses may have played a role in the prevalence of poor self-rated health from 1978 to 2004 as there have been major changes in employment patterns in advanced market democracies and employment is an important correlate of health.

Design Individual-level analysis of repeated cross-sectional surveys.

Setting UK.

Participants 125 125 men and 139 535 women of working age (25–59).

Outcome measure Self-rated general health.

Results Compared to 1978 there was evidence of higher levels of poor health in the subsequent years. For example, in 2004, the prevalence of poor health was 2.8 (95% CI 1.7 to 3.9) and 1.3 (0.1 to 2.5) percentage points higher than 1978 for men and women, respectively, after adjusting for age. After additional adjustment for socio-economic characteristics, annual differences compared to 1978 increased (5.4 (4.2 to 6.5) and 4.4 (3.2 to 5.6) for men and women in 2004). Further adjustment for employment status, however, attenuated the annual differences in poor health (0.7 (−0.3 to 1.7) for men and 1.5 (0.3 to 2.6) for women in 2004).

Conclusions These results suggest that the proportion of people in different employment statuses, particularly the proportion in sickness- or disability-related economic inactivity, could play an important role in the prevalence of poor self-rated health in the UK. Whether decreasing economic inactivity would enhance population health is an open question that needs further investigation.

Trial registration This observational study was not registered.