Guest blog: Joe Dromey, IPPR. Who cares? Why we need to introduce a real Living Wage for care workers
Joe Dromey is a Senior Research Fellow at IPPR, a Living Wage Employer. Here he shares why we need to start caring about care sector, a sector where over half of all care workers earn below the real Living Wage.
Social care is a vital public service. Across England, nearly 1.5 million people – most of them women – work to support old people and those with disabilities, either in their own homes or in a residential setting. This is some of the most important work in society, and with the elderly population rising rapidly is an increasingly important part of our economy. But social care workers are undervalued and underpaid.
The social care system is suffering from a severe and growing workforce crisis. There are now more than 100,000 unfilled vacancies in social care in England. IPPR analysis suggests that on current trends, with demand for care growing rapidly, this will rise to 350,000 vacancies by 2028 - or as many as 400,000 if EU migration is restricted.
The root cause of the growing social care workforce crisis is the endemic poverty pay in the sector. Half of all care workers in England – more than 500,000 workers across the sector – earn below the real Living Wage. The sector alone accounts for one in 10 of all low-paid workers across England. Beyond this, there is also extensive evidence of illegal low pay and the avoidance of the minimum wage.
Endemic poverty pay is the inevitable result of chronically underfunding social care. Local authorities – which commission most social care in England – have had their government funding halved since 2010. At the same time, demand for social care has been rising fast. So, while local authorities have done their best to protect this service, spending on social care in England declined by 8 per cent in real terms between 2009/10 and 2016/17.
Given ever-shrinking budgets and ever-growing demand, local authorities have all too often commissioned social care at undeliverably low rates. The UK Homecare Association calculates that local authorities should pay a minimum of £18.01 an hour for homecare, to ensure that providers can deliver a sustainable service and workers are paid at least the minimum wage. Yet the average price paid for social care in England is just £16.12. With most local authorities paying below the minimum level, there is huge pressure on providers of social care to minimise labour costs. Poverty pay is the inevitable result.
There is a strong moral case for paying the Living Wage in social care. Care work is skilled and is also important, providing a vital service to some of the most vulnerable people in society. But there is a very practical case too. Endemic low pay and poor job quality is undermining the quality of care and threatens the very sustainability of our social care system.
Some providers are bucking this unhappy trend. Penrose Care is one of a tiny number of care providers accredited as a Living Wage employer. They understand the importance of decent pay, to both staff morale and to the quality of care. But the very logic of the current system, with providers competing to win and deliver contracts let at undeliverable costs, is to keep pay and conditions low. And the end consequence of this is the workforce crisis we now face.
The social care workforce crisis is severe and it is growing. Yet this crisis is eminently soluble.
First, Government must invest more in social care. IPPR has called for an increase in National Insurance contributions of 1p in the pound to provide the funding that the NHS and social care system needs.
Second, Government must ensure that increased funding benefits the workforce. Every social care worker should be paid the real Living Wage as a bare minimum. This could be achieved by providing local authorities with additional funding conditional on them negotiating with providers to ensure that all workers in the sector receive at least the real Living Wage.
We’ve calculated that this would cost Government £445m in England. It would mean a pay rise averaging more than £1,000 a year for 500,000 low-paid care workers, and at a stroke would reduce the number of people paid below the Living Wage by nearly 10 per cent.
Tackling poverty pay in social care would be a vital first step to fixing the workforce crisis. Beyond this, IPPR has called for the extension of sectoral collective bargaining to social care. This would involve employers, workers and government negotiating minimum levels of pay, terms and conditions for the sector, as happens in the NHS, to ensure that competition doesn’t drive down standards. That would not just ensure decent pay in the sector, but it could help tackle other challenges, such as high levels of insecurity and zero hours contracts, and low levels of employer-provided training. A sectoral deal should be based on the UNISON Ethical Care Charter, which has helped improve both staff morale and satisfaction among users of care where it has been adopted.
The Government is set to release a much-delayed Green Paper on social care in the New Year. Fixing the workforce crisis should be top of its agenda. We will not be able to recruit and retain the workers we need to meet rising demand unless we boost pay in social care. We can’t deliver the care people deserve without a fairly-rewarded workforce.
It is time to introduce a real Living Wage for social care.