Specialist provider of workforce management solutions RITEQ says the key to reducing labour costs is to start with greater visibility

As costs of operating a care home continues to rise due a number of factors operators are looking for new ways to reduce workforce costs. Care home operators are being squeezed on many fronts including:

  • Reduced funding – Over the past five years, local authority funding has fallen by £4.6 billion, representing a 31% reduction in real terms. This is particularly significant in that 60% of residential care homes are local authority funded.
  • Reduced Profitability

With greater than 50% of revenue coming from local authorities, projections predict an average fall of 10% less fee income per bed leading to a fall of 28% less profit per bed.

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  • Brexit is threatening to reduce the already sparse pool of care home labour which will in turn increase agency staff costs.

The largest single operating expense is by far your workforce – up to 60% of your overall organisation operating costs.

To provide the same or better service at a lower cost means having a more efficient and productive workforce, and absolutely key to this, is a visibility and breakdown of labour costs.

Knowing exactly what tasks your labour budget is spent on, leads to finding inefficiencies, opportunities to improve, and better budgeting in future.

RITEQ’s free ebook How to increase the visibility of your costs in care homes’ shows five steps to get control of your labour costs. The starting point is understanding the breakdown of these costs and getting as granular as possible.


Tags : Best practiceWorkforce

The author Lee Peart

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