An OECD report on ageing out this week foreshadows that spending on long-term care in OECD countries is set to double, even triple, by 2050, driven by ageing populations. Governments, the OECD argues, need to make their long-term care policies more affordable and provide better support for family carers and professionals.

Help Wanted? Providing and paying for long-term care‘ says that half of all people who need long-term care are over 80 years old. And the share of the population in this age group in OECD countries will reach nearly one in ten by 2050, up sharply from one in 25 in 2010. This percentage will reach 17% in Japan and 15% in Germany by 2050.

A fast ageing world
% of population over 80 years old

The report says this population ageing is being accompanied by family ties becoming looser. The need for community involvement in the care for frail and disabled seniors is growing and will do so ever more rapidly in OECD countries.

This will challenge long-term care (LTC) services and systems. The pool of potential family carers is likely to shrink because more women are working, and social policies no longer support early retirement. Currently, between 1 and 2% of the total workforce is employed in providing long-term care. For many countries, this share will more than double by 2050. Government and private market spending on LTC is as much as 1.5% of GDP on average across the OECD, and will double or even triple between now and 2050.

The report says that over-reliance on family carers is not desirable. Many countries need to strengthen the formal Long Term Care sector.

LTC is highly labour-intensive, but working conditions for care workers are poor, few workers remain in their jobs for long and turnover is high. The number of LTC workers per 100 people aged over 80 years varies from slightly over 0.5 in the Slovak Republic to over 3.5 in Norway, Sweden and the United States. Ninety percent of LTC workers are women and many are relatively old. Typically, the required qualifications are low – and lower in home care than in institutional settings. Between 16% (Japan) and 85% (Hungary) of all LTC workers are nurses, but in most countries fewer than half the LTC workers are nurses. Difficult working conditions and low pay often generate high turnover among workers, contributing to producing a negative image of LTC, and endangering both access to, and quality of, services.

While demand for more LTC workers is growing across the OECD, and many countries are already struggling to meet the challenge, an adequate supply of LTC workers is a manageable goal. Countries can use the following strategies:

• Improving recruitment efforts (e.g., expansion of recruitment pools; recruiting migrant LTC workers). Measures to expand existing recruitments pools and create new potential pools (e.g., young people, long-term unemployed) have however met with mixed success. The inflows of migrant LTC workers is growing in some countries, but the absence of specific reference in labour migration programmes to the labour needs of the LTC sector is conspicuous.

• Increasing the retention of successfully recruited LTC workers. High staff turnover is costly. In the United States, turnover costs have been calculated to be at least USD 2 500 per vacancy. Valuing the LTC workforce by improving the pay and working conditions will have some immediate positive spin offs if retention rates increase. There is evidence of good results from measures aimed at upgrading LTC work, for example in Germany, the Netherlands, Sweden and Norway.

• Seeking options to increase the productivity of LTC workers. The main avenue has been from reorganisation of work processes, the use of ICT to reduce indirect workload, and the delegation to nursing assistants of tasks that were previously the responsibility of nurses. However, evidence on productivity improvements in LTC labour markets remains sparse.

In the long-run, improving job quality – for current workers, new hires, domestic and migrant care workers – will be important. High turnover, low quality and low pay do not seem sustainable strategies: not enough workers may be willing to provide care. The flip side of the coin is that “professionalizing” a still relatively easy-to-enter sector may raise entry barriers in the future, increasing rigidity in a sector that is regarded by workers as being highly flexible.

These measures require investment of resources, too. Cost will do up. This can only be justified if productivity is improved.

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Peter Fray
Peter Fray
Editor-in-chief of Crikey
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