Rising to the challenge: early evidence on the introduction of the National Living Wage in the social care sector

While broadly welcomed by business, the introduction of the National Living Wage (NLW) – the new higher minimum wage for workers aged 25 and over – has sparked some concerns about affordability and prompted discussions around likely employment responses – especially in lower-paying sectors where the wage increase is set to bite hardest. It will be some time before we have the hard data that lets us assess definitively the impact of the NLW across the economy. However, by accessing comprehensive and timely pay data from adult social care providers in England we can consider how the implementation of the NLW has played out to date in one of the key low-paying sectors.

In this note we focus on those firms that report fully implementing the NLW to assess how social care providers have acted both in relation to those legally eligible for the increase, and in relation to their other staff. While in many ways the sector is distinctive, we believe that the response in social care offers wider insights on how businesses may be dealing with the implementation of the NLW across the economy as a whole.