Care conundrum: demographic shifts create jobs but not workers

When AbleCare Homes began a recruitment drive last year, it ran into a serious problem: there were not enough workers.

The small, Bristol-based provider only managed by hiring migrant workers and expensive agency staff. “Without that, I’m not really sure where we’d be,” says relationship manager Josh Hawker.

In the decade to 2030, the number of over-60s will rise from 1bn to 1.4bn, according to the World Health Organization. That will trigger a sharp rise in demand for healthcare-related jobs. Consultancy McKinsey estimates there will be a need for 85mn roles globally by 2030, 50mn higher than in 2016.

But even now employers are unable to find enough workers to meet demand. In England, the number of vacant care posts rose by 52 per cent in 2021-2022, compared with a year earlier, and have since improved only slightly. The recruitment challenges are shared in countries including Japan, Germany, France and Denmark, according to think-tank the Nuffield Trust.

The problem will only become more stark. Where social changes demand more workers, the right funding, conditions and skillsets will not necessarily follow. Standing between employers and staff are complex barriers: from low wages and sector-wide underfunding, to curbs on migration, tight labour markets and poor working conditions in care homes.

The result? Not jobs, but painful labour shortages.

Some employers are taking high-tech steps to fix the problem. Japanese engineers have developed robots such as Hug, which is capable of lifting older residents, and Pepper, which runs recreational exercises. Paro, a fuzzy animatronic seal, can even provide robot animal therapy.

But so far such novel solutions have failed to substantially fix care worker shortages. “These robots have to be moved around all the time, booted up, monitored during use and then stored away,” says James Wright, an academic at Queen Mary University of London. “They’re often introduced to reduce the need for labour but end up requiring more labour and they’re expensive to scale up.”

A study by the US-based National Bureau of Economic Research found a bigger issue: robots reduced the wages of nurses and created more opportunity to undertake irregular work with fewer benefits.

If those “shiny distractions” compound structural problems of working conditions and remuneration, it could make things worse, warns Wright. “The most obvious solution,” he says, “is to pay care workers more.” For many in the sector the pay is not enough to live on, with widespread use of zero-hours contracts and pay rates often below those in lower-stress, lower-skilled jobs, including roles in supermarkets.

“Care workers are still working on minimum wage, or just above [and] that’s a problem,” says Karolina Gerlich, chief executive of the Care Workers’ Charity. “People who work, a lot of them full-time [with] extra hours, don’t get enough to pay for their food, to pay for their bills — we don’t give people money for luxuries.”

Nadra Ahmed, chair of Britain’s National Care Association, says providers know they need to “pay a lot more” to attract and retain workers. But “woefully inadequate” funding levels stand in the way. “I personally feel that we should be looking at something like £18 an hour for the skilled workforce that we have, but if we don’t get the funding to meet that, what are we going to do?”

The care sector in the UK is funded through general taxation, which flows through block grants to local authorities in most of the country. But local government budgets are under severe pressure: Birmingham city council, Europe’s largest, was in September among those to declare itself in effect bankrupt.

While local authorities often pay £600 to £700 per week for a place in a care home, some spend as little as £490 — equivalent to “less than £3 an hour” to cover staff and overheads — says Martin Green, chief executive of industry association Care England.

Other western economies face similar challenges. The European Commission estimates an additional 1.6mn long-term care workers will be needed in the EU by 2050. Yet agency Eurofound has warned that vacancies have increased in all countries except Romania and Bulgaria, and will continue to.

To plug the gap many providers, including AbleCare, are looking overseas. People with a non-British nationality accounted for 19 per cent of England’s adult social care workforce in 2022-23.

But this depends on securing sponsorship licences. Last year, AbleCare was “inundated with literally thousands of [job] applications from places such as Zimbabwe, Nigeria, India and the Philippines”, says Hawker. But the provider was only granted “a few” permissions to hire these workers: “We just don’t have enough because the UK government is trying to be seen to be tough on immigration.”

Tomas Chamorro-Premuzic, chief innovation officer at global recruiter ManpowerGroup, says curbs on immigration have made it harder to recruit and retain staff in the UK, as historically it has been easier to appeal to migrants who work in these jobs already than to British nationals doing other jobs or no job at all.

Plans to ban migrant care staff from bringing their families to the UK, announced in December as part of a drive to cut immigration, could further threaten providers’ ability to recruit.

As the Nuffield Trust notes, a recent improvement in vacancy rates was “almost solely due to immigration”. “Other countries are competing for the same staff,” it says, so the UK needs “to be attractive”.