Florin Vadean

Background and Objectives In many countries, a large proportion of long-term care staff are paid at, or near, minimum wage, leading to concerns of negative effects on care outcomes. This study analyzed the effect of staff wages on care home quality ratings in England. Research Design and Methods A national staffing database of long-term care providers was matched with local-area information on needs and supply to construct a 3-year panel (2016–2018) of English care home observations. Using multiple imputation methods to address missing data provided a data set of 12,055 observations of 5,556 care facilities (both residential and nursing homes). We analyzed the effect of the facility-level average hourly wage of care staff on national regulator quality ratings. A measure of the impact of exogenous changes in the national minimum wage on care facilities was used as an instrument for wage. Results We find that wages positively affect care home quality ratings. Other things equal, a 10% increase in the average hourly wage of direct care workers would lead to a 7.1% increase in the likelihood that a care home will have a high-quality rating. The wage effect on quality was significant when controlling for staff skill mix, measured as the share of registered nurses in nursing home staff. Discussion and Implications This study provides important evidence of the positive impact that staff pay can have on the quality of long-term care. Our finding has important implications for appropriate levels of pay and the funding of long-term care.

Background and Objectives Most job leavers in the long-term care (LTC) sector in England do not leave the sector, but rather move to other LTC employers. Nevertheless, the high “churn” can have a negative impact on continuity and quality of care, care providers’ recruitment and training costs, and the remaining staff workload and motivation. This study aimed to provide quantitative evidence on the drivers of direct care workers’ job separation in England, with a focus on job quality. Research Design and Methods We used yearly data (2016–19) from the Adult Social Care Workforce Data Set, the leading source of LTC workforce data in England, including information on both LTC workers and employers. The analysis considered panel data econometric methods that accounted for unobserved heterogeneity at worker and employer levels. Results After controlling for observed individual, organizational, and local market characteristics as well as unobserved worker and employer heterogeneity, we found that everything else being equal, wages and employment conditions (i.e., full-time contracts and contracts with guaranteed working hours) significantly reduce job separation. For example, a 10% wage increase from the sample mean would reduce the job separation rate by about 3 percentage points. This wage effect was more than halved (i.e., downward biased) when not accounting for unobserved effects. Discussion and Implications The persistent high staff turnover in LTC in England highlights the need for finding practical solutions faced by care providers and policy-makers. Our findings showed that improving pay and employment conditions can be the way forward while methodologically stressing the importance of accounting for unobserved variable bias.