Real Living Wage for social care workers: rapid evidence review (summary)

This evidence review is part of an evaluation of the Welsh Government’s policy to fund the Real Living Wage (RLW) for registered social care workers in Wales, as part of a process to develop a Theory of Change.

The research questions for this evidence review are:

• how have people put into place the RLW in the context of social care?
• what types of activities and resources has this included?
• what impact does increased/additional pay have on the social care workforce?
• what outcomes employees experience?
• what outcomes result/might result from paying the RLW?
• what outcomes do employers, the wider workforce and users experience?

The search protocol and full bibliography can be seen in Appendices A and B of the full report respectively.

Studies outline several examples of where the RLW or similar policies have been applied and the reasons why different organisations or policy makers have sought to introduce the RLW (or an increase to the base-level salary). The studies reported that:

• low pay contributed to a range of challenges in the social care sector, such as weak recruitment, workforce shortages, attrition of staff, and regular churn; these result in poor continuity of care, negatively impacting on service users
• policies to raise basic pay have predominantly been implemented to reduce the impact of low pay on recruitment and retention challenges, although other motivations – such as a perception that is the morally right thing to do – have also featured

The most prominent example of introducing a living wage in social care is in Scotland, where the devolved administration set a Scottish Living Wage (SLW) for Social Care Workers. Main findings regarding the implementation of the SLW included:

• there was not a legal framework to compel providers of social care to pay workers a specific minimum wage above that of the National Living Wage (NLW) but, “despite being under no explicit contractual obligations to pay the SLW, [most providers] had generally responded positively to the Scottish Government’s policy.”
• local authorities’ position as a main funder gave them strong market shaping powers to encourage adoption of the SLW, however, insufficient assessment of the cost of the increase and an explicit expectation that providers contributed to the increase in wage, meant some providers had concerns about implementation
• a risk identified in the literature is that, in the absence of a legal framework and sufficient funding, a possible consequence could be that there are a larger number of contracts handed back or not tendered by providers, building on an already present trend in the UK care market; this highlights how unfunded pay increases may contribute to rather than resolve issues of market instability

Two main positive outcomes for social care workers who received the RLW or a pay increase were identified from the literature.

Improved financial reward

Policy which increases the minimum pay generally results in frontline social care workers receiving an overall increase in their salaries (as they are the ones who tend to receive the lowest pay). As expected, the scale of the improvement in pay depends on how much employees were paid prior to the policy/change in pay rate and can be particularly significant if changes include increased pay for travel time for example (Werner, 2021). As a larger proportion of frontline workers in social care are women, an increase in minimum social care pay will therefore likely have a larger impact on women.

The impact of pay increases on the number of hours social care staff work is unclear, with some evidence of a switch to more Zero-Hour contracts (Vadean, 2021) or suggesting that staff may decide they can afford to work fewer hours (Werner, 2021), and other research suggesting a slight rise in average hours worked (Gardiner, 2021).

Greater job satisfaction

When workers feel that their effort is not rewarded, this can lead to stress, poorer job satisfaction, and intentions to leave their role (Stevens et al., 2021). In turn, social care workers have reported feeling more valued when their wage was increased to the Living Wage and employers echoed this saying that staff retention improved (Werner, 2021). Whether this has an impact on the quality of work being undertaken is unclear.

While evidence suggests that social care workers are likely to feel more valued due to implementation of the RLW, existing evidence for this is somewhat limited, and involved qualitative research and a small-scale survey.

Research suggests that wage increases in social care have led to some benefits but also some challenges for the wider social care sector including employers, the wider workforce and service users.

Employers

The impact that minimum pay wage increases have had for employers is complex. Some evidence indicates that improving social care workers’ pay resulted in greater staff retention which may in turn result in greater continuity of care (Werner, 2021); however, other broader research that considers employers from a range of sectors presents a more mixed picture (Heery, Nash and Hann, 2017), suggesting that simply increasing wages may not always improve recruitment and retention of staff. In Scotland, studies suggest that the introduction of a sector-wide Living Wage did not materially improve recruitment and retention (Cunningham et al., 2022).

While increasing the minimum amount paid to social care workers is likely to increase those staff’s wages, it is less likely to directly impact the wages of those in managerial positions. For example, in Scotland additional funding did not cover costs to cover pay differentials (Cunningham et al., 2022).

Without sufficient funding there is the potential that social care providers will end up taking on the financial burden of additional costs to keep pay differentials in place. If this becomes overly burdensome, there is the potential to introduce additional instability into the market, contrary to the aims of various policies (Cunningham et al., 2022).

Service users

The research into the impact of changes in social care worker pay on service users is limited. A minority of studies proposed a possible link between quality and higher wages. However, social care workers themselves report that they would deliver care to the best of their ability regardless of wage (Werner, 2021). Whilst evidence is lacking, it could reasonably be expected that improved recruitment and retention of frontline staff would result in greater continuity of care, which would likely equate to better quality of care for service users – however there is a lack of available evidence to test this theory. As noted, the evidence about whether a pay increase will translate into improved recruitment and retention is mixed.

Report Authors: Dr Katie Hann, Joshua Butt, Dr Alice McDowell, Dr Lucy Webster, Tom Noon, Colin Horswell, and Nurgul Sahin (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: 100/2025
Digital ISBN: 978-1-83625-618-2

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