Workforce, bed occupancy major issues for aged care

A new study has found the median rent as a percentage of aged care award pay was 97 per cent in Port Hedland as the sector continues to face workforce shortages and low bed occupancy rates.

Job vacancies in healthcare and social service sectors were the highest of any industry in Australia, and workforce shortages have prevented aged care providers from operating at full capacity, according to a report conducted by the Committee for Economic Development of Australia.

In March, the average occupancy rate across residential aged care facilities in Australia was 86 per cent, and in regional and remote areas the rate was as low as 50 per cent.

CEDA chief economist Cassandra Winzar said the new regulation requiring aged care facilities to provide an average 200 minutes of care per resident per day has impacted the workforce.

“New mandated staffing levels mean many facilities are operating well below full capacity because they can’t get enough workers. Some have closed altogether,” she said.

“These staffing changes are important to increase the quality of care for older Australians, but they are adding pressure on providers already struggling to maintain their workforces and come on top of growing demand for home-care services.”

The federal government's Jobs and Skills Report 2023 found shortages of community and personal service workers in the health, care and support sectors was 24 per cent, an increase from 20 per cent in 2022.

Data from federal government also found 53 per cent of all aged care facilities were operating at a loss.

Ms Winzar said not enough had been done to fix this and current government responses were not enough.

“There must be more action from government to make meaningful progress on closing this workforce gap," she said.

“Despite recent wage rises, many workers are finding it hard to remain in the sector at a time of stubbornly high inflation and employers are unable to compete on pay and conditions.

“New labour agreements have proven hard to implement and are insufficient for broad application across the industry.”

CEDA’s third annual report into Australia’s aged care sector – Duty of care: Aged-care sector running on empty – found that despite the 15 per cent wage increase implemented in July, workers in the sector are struggling amidst the rent affordability crisis.

Affordable rent is considered to be 30 per cent of a person’s income, but CEDA’s report found this was 97 per cent in Port Hedland and 46 per cent in Kalgoorlie.

Rental vacancies have also dropped, particularly in regional areas. The rate recorded in Port Hedland was 1.58 per cent and Kalgoorlie was 1.56 per cent.

Perth's rental vacancies have declined to a record low of 0.5 per cent.

Previous CEDA research found the number of direct-care workers would drop by at least 110,000 across Australia by 2030 due to the limited scope for workers to progress their career and increase earnings.

Ms Winzar said without further action, Australia would be unable to provide aged care the community expects.

“Funding for the sector, through a mix of increased government and personal contributions, will have to rise to ensure we can provide high-quality care to older Australians,” she said.