With pension contributions deducted from salaries every month, much of our working lives are structured around preparing for old age. Although these contributions are significant, quality of life in old age is not guaranteed. Care homes are not inexpensive, and the quality of elderly care is still lacking. While there has been a push to put the onus onto individuals to save more, the actual possibility of increased savings is slim as employment becomes more precarious; neither would this address the shortage of care labour.

This project, titled Institute of Care, takes the position that there must be an increase in the care labour force, that work conditions must meet the nature of care, and that a new kind of pension fund based on this labour can be constructive to these changes. Importantly, it takes the stance that simply increasing pension payments, whether from individual contributions or state subsidies, will not solve the problem because it does not address the labour that is critical to care. 

This essay is the first of two articles exploring the economy of elderly care.

The Financialisation of Care

An increasing percentage of elderly care homes are for-profit and privately owned. Investors have been expanding into this domain and consider it as one of the best assets as elderly care provides a stable revenue stream, which is in part guaranteed by the state through pension payments. Furthermore, investor interest in elderly care is fuelled by the limited possibilities in real estate, the yields of which have become more volatile over the years, particularly in commercial real estate.

Private Care Homes: Profit by Volume

Volume is the the key profit strategy employed in private care homes. Cost is reduced is by lowering labour costs. This is attained by laying off workers, decreased job security and lower wages for the workers. By offering lower prices, these care homes are more competitive in tender processes and therefore can “capture” more clients.

 At first glance this looks like a savings for both state and individuals, however this cost-efficiency approach is in direct contrast to the notion of care, which is a time intensive relationship between the caregiver (worker) and the care receiver. As such, the quality of care the elderly receive has suffered dramatically. Many care workers have quit because the reduction in staff employed means that they cannot work within their professional ideals. 

The quality of care provided at these homes has been heavily criticised with numerous complaints concerning neglect. For those who have the financial means, there has been a trend to send elderly family members to care homes abroad such as in Eastern Europe or Thailand, where labour costs are lower and workers spend more time in caring relationships with the elderly. 

Another option is in-home care delivery, in which a care worker visits a senior to ensure his or her needs are met. Where care services are delivered to the elderly through visits to their homes, care workers are often rushed and are unable to develop the relationship needed for care. In turn, the elderly can often become isolated with their needs unmet.

Structures for Care

The organisation of care labour is critical to the project. Wages are a significant topic, but so is the current structural bias that works against the provision of care. Competitive tendering and marketisation have been applicable to the senior care sector since the 90s. Tenders for care providers require that the task of caring be to be standardised and itemised for direct cost comparison, which lies in direct contrast to the nature of care itself, which is a relationship that asks for observation, consideration and reaction to each individual situation. The specificities to elderly care presents further challenges, since compared to childcare, the needs of the elderly can vary greatly between individuals. The Institute of Care therefore aims to organise care labour so that it may allow care workers to make their professional judgements on what is best suited to the individual situation.

The UK and Europe, as in many other regions, is facing an aging population. Although there is the hope that we will all age better, there will certainly be an increased need for elderly care. The nature of care means that the deployment of technology, while helpful, will be limited if we expect quality care. An increased investment into an organised care labour force is critical. 

The institutionalisation of care work can be an occasion to give care workers, whose professional ethics have often been undermined due to cost cutting measures, greater say in how they see care should be provided. As care is a relationship between people, the capacity for care workers to organise to their work according to their own judgement of each individual situation will also lead to an improvement to the care we all receive.

The next article will discuss pension funds and their effects, and how a re-imagination of a pension fund may address some of these issues.