Care Home Staffing Crisis – A Perfect Storm Arrives

Care Staff Must Have Better Pay to Stop The Exodus to Other Employers.

Care home providers face a uniquely complex landscape, with ongoing regulatory and funding challenges now compounded by Covid-19, making the task of operating in Social Care anything but straightforward.  This year the growth of this staffing crisis has exacerbated the difficulties and The Croft is no longer immune to its impact.

Care homes in the UK went into the Covid-19 pandemic with 120,000 vacancies (The Guardian) and had become heavily dependent on agency staff.  18 months into the pandemic and the staffing challenge for care homes has significantly worsened   There has been a perfect storm of factors in 2021 which is driving increases in vacancies.  The combined effect of the pandemic and BREXIT has caused Europeans, who most care homes relied on to fill staffing gaps, to return to their home countries.  The impact of this mass exodus is now being aggravated by the competition for staff with other sectors, like retail and hospitality.  With unemployment still quite low in the UK, at around 5%, and with businesses returning to normal, the competition for staff is intense.  Large high street and on-line retailers in our area are now offering up to £12 to £16 per hour for entry level roles, and care homes simply can’t compete. 

Until April this year, The Croft had been more or less immune to the staffing crisis.  We pay all staff at or above the Real Living Wage (which is well above the National Living Wage) and work hard to provide a positive work environment.  Our agency dependency was very low and annual staff turnover less than half the 32% UK average.  We had even managed to recruit some senior staff, who are particularly hard to find.  However, since the economy has started to re-open in May, we have found it much harder to recruit to fill vacancies at all levels and we’ve put this down to care staff opting for higher paid jobs in other sectors.  Our staffing agency partners have also been struggling to recruit.  But now we can see an additional trend compounding the staffing issue.  

The Furlough scheme starts to wind down this month and this is bringing with it a new, unexpected, challenge for many employers of front-line staff in health, care and service roles.  The widely reported Furlough effect on British society means many families have been re-evaluating their priorities during lock down.  Rather than rushing back to their old jobs, some double income families have decided that, by tightening their belts, they can now survive on a single income, or a single income supplemented by a part-time income.  Priorities have changed and ’time with family’ has jumped up the list, and rightly so.  For many care workers, the majority of whom are female, their care job makes a smaller contribution to family income than their partner’s.  So it’s the care roles, which also include unsociable hours, which are being traded in for higher paid part-time work in other sectors, including retail and food production.  And it’s our senior staff, who tend to be more financially established, who are making these choices first. 

One of our most senior staff members at The Croft recently left for a 4 day week, Monday to Thursday role with a nearby food producer, enabling her to spend weekends with her husband.  And she is not the only one who has made a move like this, or who is considering such a move.  The combination of low pay relative to other part-time options, coupled with the unsociable hours, are the key drivers for experienced staff to be leaving the sector.  At The Croft, we’ve been trying to address low pay for the past year.  Our pay rates across the board are higher than most other care homes in the area.  But there really isn’t much we can do about unsociable hours, as care is a 24 hour, 7 day a week endeavour. 

What’s the answer?  How do we stop the staff exodus from our care homes?  Better terms and conditions are certainly part of the answer and we’ve made our own strides in this regard.  We also try to run a rota system that gives staff every other weekend off.  But, as our staffing levels get tighter, this becomes harder to achieve and a vicious circle ensues of relying more on fewer staff who have to make more personal sacrifices and spend less time with their loved ones.  We will join the call to ensure care staff at all levels are included as part of the UK’s immigration quotas, but, with Priti Patel in the Home Office, we are worried this call will fall on deaf ears (The Croft Blog: Low Wage Not Low Skill). 

Which brings us back to pay.  Care workers do not feel valued by British society and this needs to change immediately, or the social care staffing crisis may go past the point of no return.  Constrained by the social care funding gap, many care homes cannot afford to pay staff more to compete with other local employers.  Those of us who rely wholly, or partially, on residents funded by Local Authorities, are not simply able to put up our fees to pay for increased costs.  Fee increases have to be negotiated over a long period of time and are often rejected by Local Authorities.  Care homes which carry a significant debt, which isn’t unusual since the costs of entry into the sector are very high, are the ones who have the least room to manoeuvre on pay.  Even with historically low interest rates, the returns expected by banks on their capital are still a significant burden. 

As Providers of The Croft, David and I are very fortunate to have no bank debt and only a relatively small personal loan in proportion to the value of The Croft.  This means we have been able to reinvest our margins back into The Croft, improving the facilities and offering higher pay rates for all staff.  But we are in the fortunate minority in the care sector.  We can “weather the storm” by minimising our return on capital expectations from The Croft and rely on our other businesses, in different sectors, to meet our income needs.   

This gives The Croft a level of security that most other Providers are not in a position to offer.  We are now working with our manager to decide how we can better compete for staff and we realise we are not competing with other care homes.  We are competing with the retailers, food producers and hospitality businesses locally.  Pay will continue to rise at The Croft, and other benefits are being considered or being implemented, such as recruitment bonuses for existing staff who help us find new staff, as well as signing bonuses for staff who successfully complete their probation. 

But, despite headlines to the contrary, most care home Providers are not in a position to take these steps.  Unless a care home is in the minority group that only has residents who are funded privately, and therefore has the scope to push up fees, they will be hamstrung by successive Government failure to tackle the social funding crisis for well over a decade.  As they struggle to recruit staff to maintain the legally required staffing ratios, homes will start reducing the bed space they offer, or shut-up shop all together and at a faster rate than they have been already in the UK.  And residents, most of whom are very vulnerable with a range of serious health issues, are likely to be returned to hospitals with no other options for their care.  The NHS really isn’t equipped for what is already happening in the care home sector, especially as their current focus is on trying to free up beds by sending the “bed-blocking” elderly out to care homes as quickly as possible. 

Whether or not newly appointed Health and Social Care Secretary, Sajid Javid, will tackle the social care funding crisis remains to be seen, although many think he will.  The Government has set itself a deadline for coming up with a solution by the end of this year.  But that’s just another deadline that doesn’t mean much and is likely to be breezed through, as has been the case with so many others.  I hope I am wrong about that.  A radical rethink not just on the route of funding for social care, but also the level of funding, is urgently needed.  I’m of the school of thought that social care should become part of the NHS, delivering integrated healthcare and support for people of all ages, and paid for by higher taxes. I don’t think there is much escaping the tax increase reality. One way or the other, those with assets and wealth will need to be relied on to help support those without. 

Whether or not this Government will grasp the nettle is a different matter.  Most of us in the sector are not optimistic, even despite legislative changes under-way to help address the social care issues. Hence we are making our own plans in relation to how to survive this perfect storm of issues which is threatening our ability to provide for the elderly and vulnerable that our dedicated staff so wonderfully look after. 

Simon Spiller
Simon is co-owner and Registered Provider of The Croft Residential Home in Newton Abbot, Devon, as well as owning other small businesses.  He is a Fellow of the Royal Society of Arts.