Latest ASHE data on carers' pay – PPO recalculations and care cost inflation

The data

The data for carers' earnings is published for two occupational groups including Standard Occupational Classification (SOC) 6135 for "care workers and home carers" and SOC 6136 for "senior care workers" and the combined data for these can be found in Table 26. The latest data includes the revised data for 2022 and the provisional data for this year and this relates to pay in April of each year.

The data for gross hourly pay for all employees (which is what PPOs are linked to) and the annual increases in this are as follows:

These increases very much mirror those for all employees for all occupations which no doubt at least partially explains the continuing difficulties that the care sector has recruiting and retaining staff (i.e. the current level of pay increases is not making this a more attractive occupation). The annual increases for all occupations are as follows:

PPO recalculations

Payments for future care tend to be linked to the 70^th to 90^th percentiles of ASHE SOC 6135 & 6136 with the vast majority being linked to the 80^th percentile which has become the default percentile. Accordingly, the increases in these payments will be at the lower end of the range of the increases, albeit still between 6.3% and almost 7%. 

The highest increase will be in those payments linked to the default 80^th percentile, but this makes up for the fact that the increase at this percentile was lower than the others last year, so it has balanced out over the last couple of years. By way of comparison, last year's increases (based on the 2021 revised data and the 2022 provisional data) for the same percentiles stood at 7.46%, 6.98%, 6.56% and 6.73% respectively, i.e. these were slightly higher with the exception of the 80^th percentile.

In any event, the increases are considerably below the statutory default index for PPOs which is RPI as this was 11.4% in April this year (i.e. the month that the ASHE data relates to) and still stood at 8.9% in September (i.e. the last published month and the month which PPO December calculations are normally based on). Indeed, the position remains that claimants whose care payments are linked to RPI have received distinctly higher increases than those with payments linked to ASHE.

Moving onto the nuts and bolts of the recalculations, as in previous years, there is very little movement between the provisional data and the revised data for 2022 at the 70^th to 90^th percentiles with all of these remaining unchanged apart from the 90^th percentile which has increased by 0.03 (i.e. 3p per hour).

The increase in carers' pay

The increases in the lower percentiles of ASHE SOC 6135 & 6136 are distinctly higher than the upper percentiles because the former have been affected by the increase in the National Living Wage (for those aged 23 and over) and the National Minimum Wage (for younger people) with, for example, the NLW increasing from £9.50ph to £10.42ph (i.e. by 9.68%) during April this year (i.e. the month that the ASHE data relate to). These increases are more similar to the increases in private care rates that we are seeing on the ground although there is an element of coincidence as private care rates are at the other end of the pay spectrum.

The likelihood is that the ASHE rates are still heavily influenced by the rates that local authorities and the NHS can afford to pay with this having a tempering effect on the higher percentiles that apply to PPOs while the increases in the lower percentiles are driven by the increases in the NLW and NMW. In contrast, private care costs are more affected by supply and demand (due to the continuing difficulties recruiting and retaining carers) as well as other inflationary pressures.

The increases that we have referred to relate to the 12 month period from May 2022 to April 2023 and, therefore, are now 6 months old. By way of comparison:

• Skills for Care, which is a charity working to improve adult social care, reported an annual increase in carers' pay at the median (i.e. 50^th percentile) of 6.42% during the 12 month period up to March 2023 (i.e. the month before the last increase in the NLW and NMW).
• Homecare Association, which is a membership body for homecare providers, projected an 11.25% increase in the hourly cost of providing homecare as a result of the last increase in the NLW.
• The National Joint Council for Local Government Services has not yet agreed the rate to be applied to local authority carers' pay from April this year, but the employers have offered trade unions the equivalent of a 9.42% increase.

What is clear is that carers' pay and conditions are going to need to improve if the continuing difficulties with recruitment and retention are to be addressed and this has led Care England, which represents independent providers of adult social care, to advocate a minimum gross hourly rate of £15 in England to achieve this.

For more information or advice, please contact one of our experts in our Complex Injury Team.