Providers Running to Stand Still: New Skills for Care Data Shows that 58% of care workers are currently paid below the National Living Wage

Care England, the leading voice of adult social care providers in England, has issued an urgent call to action regarding the financial challenges facing  the adult social care sector outlined in the latest Skills for Care Report. Today, it has been revealed that 58% of care workers are currently paid below the upcoming National Living Wage (NLW), highlighting the financial strain providers will face as they increase staff pay to keep up with the change, as well as try to compete with other sectors, and offer pay progression for senior workers.

Earlier this year, Care England published their annual Sector Pulse Check in collaboration with Hft, which revealed that that 85% of providers said that local authority fee increases did not cover the costs of a higher NLW, underscoring the severe funding gap and the financial strain on providers who are struggling to deliver high-quality care while also ensuring their workforce is paid fairly. This funding shortfall is a critical factor hindering providers’ ability to offer competitive salaries and invest in workforce development. This, alongside the government’s recent job-tax, which has seen the increase in Employer’s National Insurance contributions, and the increase in costs and delayed processes in utilising international recruitment; providers are faced with constant challenges. Therefore, to relieve some of this pressure, the government needs to commit to an adequate funding solution to help ensure providers can stay afloat and continue to provide the high-quality care expected.

Professor Martin Green OBE, CEO of Care England, commented:

“Over recent years the workforce crisis in the adult social care sector has deepened. The annual increase in wage is vital for the millions of workers in social care. We know pay has been a longstanding battle, however, let’s be clear that there is no funding to support this increase, which will continue to stretch an already overstretched sector. The sector is crying out for an adequate funding solution from the government, as without this, many providers will be pushed to the point of collapse. Providers are running to try and keep up with the National Living Wage increases, however, they are standing still due to competition from other sectors, and the lack of pay progression they can provide to their staff due to funding constraints. Care providers are caught between rising wage costs and insufficient money to fund them. Many are already struggling to recruit and retain staff, and with further financial pressures, the situation is only going to worsen. This is not just a problem for the providers themselves – it is a direct threat to the quality of care that millions rely on”.

The Skills for Care Report encapsulates the concerns within the workforce. In December 2024, there was only a 4p pay difference between individuals with over five years of experience and those with just one year. This stark discrepancy underscores the ongoing workforce crisis. Without adequate pay progression reflecting years of service, many employees may become disillusioned and seek alternative employment opportunities.

The Skills for Care report reveals the urgent need for government action to review local authority funding, alongside a commitment to an increase in funding and support for the social care sector to ensure the long-term sustainability of these services. If care providers are to deliver the high-quality care that people depend on, they must be adequately funded to do so – starting with the ability to recognise the current workforce crisis.