Australia’s care economy and why it matters to you

If you were asked, “what is Australia’s biggest industry?”, what comes to mind?

Words by Emeritus Professor David Hayward, Chair Care Economy CRC

If you were asked, “what is Australia’s biggest industry?”, what comes to mind?

Construction perhaps? Maybe manufacturing? If not, then surely Science, Technology, Engineering and Maths (STEM)?
If you opted for any of these, you would be wrong. Our biggest employer by very long way is our care economy. With over 1.8m employees, it towers over all others and is also growing at the fastest clip.

This has to be our best kept secret, doesn’t it.

It’s not well known because we don’t think of a care economy. We see silos. Aged care, disability, child care, family violence, children’s services, social housing, mental health.

All these silos share in common that what they deliver is care. Most also involve a requirement, with permission of course, to touch, a very unusual attribute of a type of work. Most also require a degree of emotional commitment not required in other work places. The work is inherently complex, difficult and tough.

We see these silos because that is the way we present them, in the last decade through a succession of Royal Commissions at the state and federal levels.

These have all concluded that our care economy is in crisis.

Pay is too low. Qualifications are not fit for purpose. Turnover is startingly high. There are worker shortages everywhere. And all of this while those cared for end up being treated poorly, courtesy of lax regulations, which focus on compliance in an industry that runs on the smell of an oily rag.

How did we get into this mess?

We see the care economy as being about welfare and consumption; something we do when we have the cash to spend on it. So we try to keep costs low and in an industry where labour costs account for the lion’s share of budgets, that means keeping wages low and also creating a workforce dominated by casuals.

And of course, this casualised, poorly paid and under recognised workforce is composed mainly of women. There is another side to the care economy, which we don’t think about too much. We have a nascent industry capable of manufacturing mobility devices, using technology repurposed from our now wound up car industry.

There is also ample opportunity for new digital technologies and software that could help make things so much easier for providers and consumers in touch of a button. That could shift a big chunk of the workforce from the back of the office, to where it is needed most, and that’s up front.

If we get it right, the care economy offers a wonderful chance to build a new industry that will be based on rewarding careers, in which carers are able to move up the ladder and sideways into those old silos that will have disappeared. A few years in child care might be followed by time in aged care or disability. It might even have a sandwich year in social housing or mental health.

And if we get it right, not only will the care economy be so much more efficient, it will be so much more productive. The Aged Care Royal Commission, for example, reckoned there were $600m in savings annually by simply reducing staff turnover to acceptable levels.

When we get it fit for purpose, our care economy will be ripe to be taken it to the rest of the world, with our Asian neighbours now growing their very own care economies at a very rapid clip but from a very low base.

So next time you think about our biggest industry, think of the care economy and the wonderful opportunity it offers not just for future prosperity and better careers, but a vastly improved experience for the people who use it enjoying a longer and happier life.

La Trobe Industry contact: Hope Terdich, Manager – Marketing and Communications,