Lost labour of unpaid carers costs carers and the economy up to £47.7bn
Our new research has revealed the huge financial and social benefits of supporting unpaid carers into, and remaining in, employment.
25% of carers are considered by the state to be ‘economically inactive’. Around 1 million receive Carer’s Allowance of just £83.30 a week. 28% live in poverty. One way of improving carers’ financial situation is by ensuring they are able to enter paid work.
But, right now, despite their huge contribution to society through the care they give, they are not being supported to do this. This report – using a detailed Return on Investment (ROI) tool – establishes a positive economic case for ensuring carers who are able to, are supported into employment.
"The hidden cost of unpaid care: The economic price of locking carers out of work" is part of a partnership between Carers Trust and Phoenix Group delivered through Phoenix Group’s Caring for Carers initiative. The Standard Life Centre for the Future of Retirement, Phoenix Group's in-house think tank, provided feedback on the research.
The report is funded by the Group within its ‘Caring for Carers’ initiative. The findings showed:
- The total lost labour of unpaid carers is worth up to £47.7bn a year – equivalent to 1.7% of the UK’s entire GDP – which would further boost economic growth, contributing an additional £20.4bn in Gross Value Added (GVA) across the economy from carers having a higher income to spend.
- Helping unpaid carers closest to the job market back into work could boost the UK economy and household incomes by up to £16.9bn a year, leading to a further £7.2bn increase in GVA across the rest of the economy.
- Of the UK’s nearly six million unpaid carers, almost half (2.7 million) are not in paid employment, including 524,000 who are currently unemployed but could work with the right support.
- If those 524,000 carers moved into full-time work, their household income could rise by up to £10.1bn, with additional benefits of up to £2.8bn in reduced welfare payments and £4bn in increased tax contributions.
- Beyond the financial impact, improved support would also help carers regain skills, confidence, and long-term career opportunities.
This research underscores the urgent need for action—not only to empower carers with opportunities, but also to strengthen the wider economy.
The partnership has also launched a two-year employability programme at Camden Carers Centre in London, helping carers to boost their employment opportunities and skills.
One carer who is taking part in the Phoenix Group funded employability programme, has been out of work since 2011. She said:
“Even just those initial steps to join the programme was nerve racking for me as I was really out of my comfort zone but the team at Camden Carers centre were so helpful and really patient especially when helping me write my job applications.”
The State should invest in specialist employment support for carers so employers are able to understand the challenges and barriers of balancing caring with work and can help with carer-friendly initiatives. There must also be increased investment in social care to allow people the chance to work.
Supporting more carers into paid work would play a vital part to achieving the Government's economic ambitions.
This vital support would get more people into employment, reduce sky high poverty rates among carers, and help reduce spend on welfare. This needs and deserves investment to realise these benefits.
The ROI tool will enable service providers, commissioners, or decision-makers to quickly and easily establish and set out the positive economic impact of supporting carers in returning to work. To be sent the ROI tool please email policy@carers.org.
The study has been carried out by independent economics consultancy, Cambridge Econometrics.