Raising Carer Wages Could Fix Workforce Crisis and Cut Costs, Report Finds

LONDON May 19: A new report by the Fabian Society urges the government to raise the minimum wage for social care workers to match NHS band 3 pay, arguing that doing so would help tackle staff shortages, reduce turnover, and improve care quality — while also saving providers money.

The report proposes a minimum wage of £13.17 an hour, which would benefit around 603,000 care workers, delivering an average pay rise of £2,050 per year. Improved sick pay and pensions are also recommended to address widespread financial insecurity among carers. Nearly one in five care workers live in poverty, more than twice the rate of their NHS counterparts.

Key Recommendations for Care Workers
Pay: Raise the minimum wage to NHS band 3 levels (£13.17/hr).

Sick Pay: Provide occupational sick pay covering at least 50% of regular pay.

Pensions: Increase employer pension contributions to 5%.

Training: Ensure all staff have or are working towards the Care Certificate.

Impact on Care Providers
Reduced Turnover: Higher pay could lead to 27,000 fewer care workers leaving each year, saving an estimated £163 million annually in recruitment and training.

Staffing Boost: The improved pay package is projected to attract 90,000 additional workers, effectively eliminating the sector’s chronic staffing shortage.

The report paints a stark picture of the sector: carers are underpaid, undervalued, and overburdened, often delivering high-quality care despite insecure work, limited training opportunities, and poor prospects for advancement.

“The treatment of the social care workforce is a national scandal,” said Joe Dromey, general secretary of the Fabian Society and co-author of the report. “Care workers deliver vital support, yet they face poverty pay, chronic insecurity, and have few opportunities for progression.”

Christina McAnea, general secretary of Unison, added: “Raising wages in care is the first step to turning around this beleaguered sector. Care work is highly skilled… but it’s paid as if it’s a low-skilled job.”

Policy Momentum
The proposals align with Labour’s 2024 manifesto, which commits to a Fair Pay Agreement in Adult Social Care. This policy — currently progressing through Parliament as part of the Employment Rights Bill — aims to address the sector’s recruitment and retention crisis and support broader NHS recovery efforts.

With an estimated 120,000 care vacancies in England and the government’s recent decision to phase out overseas social care visas, the pressure is mounting to strengthen domestic recruitment.

Prime Minister Keir Starmer, whose sister is a carer, has pledged to tackle the crisis. The Fabian Society argues that investing £1.5 billion a year in improved pay and conditions would not only benefit workers but also lead to better care standards and reduced pressure on the NHS.

The report, titled Seizing the Opportunity, concludes that without bold action on pay and conditions, the sustainability of the care sector —and the quality of support it provides — will remain at risk.