The number of care workers has grown to now represent 15 percent of the entire Australian workforce.
A new study by economic research institute e61 has found, with the NDIS and population ageing increasing demand for care, the care sector had grown dramatically since 2010, when it took up 10 percent of the workforce.
e61 Institute Research Manager Ewan Rankin said the care economy now employed 15 percent of working Australians and its recent growth had lowered the nation’s productivity.
Mr Rankin said while new migrants filled 20 percent of these jobs, this was a lower share than in other fast-growing industries.
“Instead, the vast majority of new jobs were filled by workers switching from other industries such as hospitality, retail and manufacturing,” he said.
Mr Rankin said this reflected that retail and hospitality were high “churn” industries and that many Australians used them as a first rung on the job ladder.
“Fast growth in the care economy looks to have captured many of the subsequent second steps on the job ladder.”
He said the study found that there had been virtually no measured labour productivity growth in the care economy for 20 years.
“Because its measured productivity is low, the growth of the sector has reduced overall productivity by 0.2 percent each year since 2019,” he said.
“For the past 20 years we have failed to generate labour productivity growth in the care sector, but there is ample potential to do better over the next 20.”
Mr Rankin said when people heard “improve productivity” they tended to think about cuts and slashing staff, but that was unlikely to be an approach that would work in this sector at this time.
“Boosting productivity in the care sector could instead come from adjusting funding models to pay for outcomes rather than quantity, a greater focus on preventative care, and technology adoption in areas like administration and diagnostics.”
Download the e61 Research Note.
