Real Living Wage for social care workers: impact evaluation (summary)

The Welsh Government commissioned Cordis Bright to conduct an independent evaluation of its policy commitment to pay social care workers in Wales the Real Living Wage (RLW). This evaluation included the development of a Theory of Change, a process evaluation, and an impact evaluation.

This report summarises findings from the Impact Evaluation of the RLW policy, assessing the effect of the RLW on social care workers and identifying the impact of the policy across different groups of stakeholders and the workforce as a whole.

Overall, the policy has largely achieved its central aim of extending a living wage to more social care workers across Wales, with 84% of surveyed workers reporting they receive the RLW. This is a significant achievement during a period of rising costs and resource constraints, and stakeholders widely viewed it as the “right thing to do”. However, approximately 16% of surveyed workers reported being paid below the RLW, showing there is still progress to be made on coverage.

It is important to note that the RLW policy was never intended to resolve all workforce challenges on its own, and its specific contribution is challenging to disentangle from other factors, such as labour market pressures, cost-of-living challenges, and structural funding issues. While the policy has made a positive, albeit limited, contribution to outcomes like morale and retention, these effects have been constrained by strong countervailing forces.

The aim of the Impact Evaluation was to evaluate the impact of paying the RLW to social care workers in Wales, identify if the payment of the RLW has resulted in intended or unintended consequences and to recommend improvements for the future of paying the RLW.

This evaluation examined the impact since the policy’s implementation in April 2022, with data collected between November 2024 and February 2025.

A mixed methods approach was used to explore the impact of the RLW policy across all types of social care and regions of Wales, including:

• interviews with eight national strategic stakeholders
• interviews with 21 social care commissioners
• interviews with 23 care providers and a workshop with 10 care providers at a provider forum
• two regional workshops with seven social care workers and individual interviews with three personal assistants (PAs) and two social care workers
• an online survey with social care workers and PAs, completed by 2,364 people
• an online survey with Direct Payment (DP) recipients, who use their payments to employ PAs, completed by 276

Impact of the Real Living Wage policy

The RLW policy set an ambitious goal of extending the Real Living Wage to all social care workers in Wales. This evaluation finds that the policy has made substantial progress towards that goal, achieving a notable shift in pay equity across the workforce during a time of unprecedented challenge for the sector.

Most significantly, the majority of social care workers are now receiving the RLW. Survey data shows that 84% of respondents report being paid the RLW, a major uplift in coverage. This compares favourably to England, where just 52% of adult social care workers were estimated to be receiving the RLW as of December 2024 (Skills for Care, 2025).

There is evidence that the policy has contributed to improved financial wellbeing for some social care workers. Those receiving the RLW were less likely to report financial hardship. While many workers continue to face financial pressures, the evaluation suggests that, without this policy, levels of hardship would likely have been higher, especially given the broader cost-of-living crisis.

The policy has also had a positive effect on morale and perceptions of being valued, particularly during the initial stages of implementation. This suggests that, in addition to raising pay, the RLW has sent an important message of recognition to care workers. However, these gains have not been universally sustained and appear to have been eroded over time by wider system pressures.

From the outset, stakeholders were clear that this policy was not expected to resolve significant workforce challenges in recruitment, retention and stability, but it was anticipated that it may make a positive contribution to these long-standing challenges.

There are signs of modest improvements in staff retention, especially among entry-level workers, which may reflect increased financial stability and recognition. However, the RLW has had limited impact on recruitment, which continues to be shaped by external labour market conditions and competing opportunities in sectors such as the NHS, retail and hospitality. Career progression also remains limited, with some flattened pay structures making it harder for providers to differentiate between frontline and supervisory roles. This was likely a consequence of the fast-rising NLW, but the RLW also contributed to this challenge.

While the evidence of positive impact is modest, stakeholders did suggest that were the RLW not in place, they would have expected outcomes to have been worse.

Importantly, the RLW policy has not yet reached all parts of the workforce. The evaluation highlights lower levels of RLW receipt among care workers from Black or Asian backgrounds, personal assistants, and those working in children and families services. This suggests the need for targeted action to ensure greater equity in policy delivery.

Some unintended consequences have also emerged. A minority of workers have reported reductions in enhancements such as overtime pay and bonuses, and some report deteriorating terms and conditions. Care providers have faced financial strain, with some drawing on reserves or reducing investment in areas such as training, maintenance and service development to meet rising wage and operational costs. Commissioners reported that RLW funding pressures have had knock-on effects on wider council budgets, with some redirecting resources from preventative services or pausing recruitment. Relationships between commissioners and providers have at times been challenged by inconsistent funding approaches and issues with the timing and enforcement of RLW policy.

For people drawing on care, the impact appears mixed. In some cases, the policy may have helped support continuity of care, although there is limited evidence of improvements in quality overall. Among Direct Payment recipients, a minority reported that quality of care had improved. However, in some areas, access and affordability have worsened due to rising costs, top-up fees, or reduced care hours.

Overall, while the RLW policy has made meaningful progress in raising pay and supporting financial stability, its impact has been constrained by external factors, and its role must be understood as one part of a wider set of workforce reforms.

Understanding the impact of the Real Living Wage policy

The RLW policy was introduced on the assumption that improved pay would contribute to better recruitment, retention, and perceptions of value across social care. However, it was never expected to address these challenges alone, and its contribution must be seen in the context of broader system and labour market pressures.

Evaluation evidence suggests that these outcomes have begun to emerge in some areas, although progress has been mixed and influenced by a range of external factors beyond the control of the policy, particularly at a sector level.

It is important to consider the RLW policy within the wider context of system change. Its implementation has coincided with other developments such as workforce registration, changes in immigration policy, the cost-of-living crisis and rising demand for care, all of which have shaped how the policy has been delivered and experienced.

Labour market conditions have evolved significantly since the policy was launched. Pay increases in other low-wage sectors, including retail, hospitality and the NHS, alongside high inflation, have reduced the RLW’s distinctiveness. The narrowing gap between the National Living Wage and the RLW, now just 39 pence as of May 2025, is likely to make it more difficult for the RLW to remain a strong lever for attracting and retaining staff.

The policy has also had effects beyond its original scope. For example, it has created pressure to raise wages for non-care staff. While this may be viewed positively in terms of fairness, it has added financial strain and, in some cases, confusion for employers. Preventative services, which were not included in the RLW policy, have become more difficult to staff sustainably, which suggests the importance of a more joined-up workforce approach.

Wider structural and contextual challenges continue to limit the potential impact of the policy. These include increasing demand for care, long-term underfunding and a lack of sustained investment in workforce development. Without parallel reforms, such as improved terms and conditions and a clearer career pathway, the RLW alone is unlikely to deliver transformative change.

Stakeholders view the RLW as a positive and symbolic baseline for pay in social care, but not as a sufficient long-term strategy. There is a growing consensus that the benefits delivered so far provide a valuable foundation. However, realising the full potential of the policy will require long-term structural investment, better alignment between workforce and funding strategies, and a more strategic approach to workforce planning and development.

The RLW policy has been successfully implemented and has made significant progress towards improving the pay and recognition of social care workers. It has laid a strong foundation for further reform and investment. To build on this success, the evaluation recommends four important actions to increase the reach, consistency and long-term impact of the RLW policy.

The four recommendations from the Impact Evaluation

Reframe wage setting in social care to reflect labour market competition, building on the RLW and the developing pay and progression framework, with a long-term goal of achieving and maintaining pay parity with equivalent roles in the NHS. Welsh Government should build on the success of the RLW by integrating a longer-term approach to wage benchmarking within the pay and progression framework and the forthcoming fair pay agreement. The ambition should be to ensure social care pay reflects labour market comparators, particularly NHS Band 3 roles, which more accurately reflect the responsibilities of many care workers. This would support recruitment, retention, and the positioning of social care as a valued and sustainable career. Stakeholders recognise that this ambition will require investment, collaboration, and time, but believe it is essential to secure the future of the workforce.

Close the coverage gap: Identify and address the causes of non-payment of the RLW to the remaining 16% of the workforce, with targeted action for groups most affected.

Improve monitoring and enforcement: Reintroduce robust and consistent wage monitoring through contract management, with clearer expectations and mechanisms to ensure compliance.

Track progress and share learning: Conduct and publish an annual review of RLW coverage and impact, informed by sector-wide engagement, to support transparency and continual improvement.

Report Authors: Dr Lucy Webster, Joshua Butt, Samyukta Srinivasan, Dr Alice McDowell, Caitin de Souza, Tom Noon (Cordis Bright)

Views expressed in this report are those of the researchers and not necessarily those of the Welsh Government

For further information please contact:
Analysis and Innovation Team
National Office for Care and Support
Welsh Government
Cathays Park
Cardiff
CF10 3NQ

Email: AnalysisAndInnovationTeam@gov.wales

Social research number: 103/2025
Digital ISBN: 978-1-80633-524-4

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