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Cooperatives moving into the care economy

An interview with Lenore Matthew from the ILO’s Cooperatives Unit (COOP) and the Gender, Equality and Diversity Branch (GED), who presented new research showing how cooperatives are increasingly providing care for the elderly, people with disabilities and children.

Reportaje | 26 de octubre de 2015
(left) Claudia Fiaschi, Vice-President, Coopermondo and Confcooperative, with Lenore Matthew, ILO’s Cooperatives Unit (right)
1) Cooperatives are increasingly providing care: is this a global trend?

The initiative I am contributing to here at the ILO is a global mapping of the provision of care through cooperatives. I contributed to the research phases of the project, which involved a literature review, an online survey and key informant interviews. This research will feed into next steps: dissemination and a series of policy and programmatic initiatives, namely in country pilots.

The objectives of this global mapping were to identify the ways in which cooperatives are providing care services across the globe, and to understand the role and potential of cooperatives as employers in the care economy. We talked to more than 210 stakeholders and experts from the cooperatives movement and the care sector, and found that cooperatives are increasingly providing care across the globe and doing so in socially and organizationally innovative ways. Whereas cooperatives in sectors such as agriculture, finance and housing may be more well-known, we’re seeing that cooperatives are emerging in the care sector to address the needs of specific population groups like the elderly, persons living with disabilities and children.

In some cases, cooperatives are working in collaboration with, or as a part of well-established cooperatives. For instance, housing cooperatives have added on childcare services, based upon members’ needs. The participants in the study have emphasized that through their democratic and inclusive nature, cooperatives provide care in a different way, focusing on interdependence, rather than dependence.

2) When and why did this happen?

This is a multi-layered question… as there are many different reasons. One is austerity, or the retreat of the welfare state in providing public care services. In Italy, cooperatives in the care sector emerged as early as in the 1970s; due to a lack of public funds, and cooperatives began filling the gap.

Another reason is the inaccessibility, unaffordability or simple lack of other private sector options.

So in many instances, we’re seeing an emergence of cooperatives as a third way where public and private sectors leave a gap.

Changing demographic and population characteristics also play an important role. The rapid and unprecedented growth of the elderly population in almost all regions of the world is one factor, as are other factors like the increase of non-communicable diseases. All in all, the needs for care and the way it is provided have changed significantly, and will continue to do so over the next decades. All this is driving a call for innovative ways of addressing new care needs.

3) What is the share of cooperatives in the care economy?

I don’t think we know the exact size of it yet but the responses to our survey indicate that it is growing and shows much potential. Thirty-seven per cent of the survey respondents reported that the number of cooperatives providing care increased over the last ten years. Another 40 per cent of respondents shared that the number of beneficiaries receiving care services from a cooperative increased over that same period of time.

These are good indicators. But as many of our interviewees told us, we need more and better data in order to move forward. We need both qualitative case studies and hard quantitative facts, like the economic contributions of care cooperatives to employment creation and to the economy. These data are critical to showing funders, governments and other stakeholders why they should invest and engage in this area. At the ILO another initiative is underway, working with member states and the cooperative movement to improve data collection and analysis systems on cooperatives, based on a resolution adopted during the 19th International Conference of Labour Statisticians in 2013.

Italy is a leader in provision of care through cooperatives and has an advanced cooperative data collection system. Claudia Fiaschi, Vice-President, Coopermondo and Confcooperative, made a presentation on the experience of Italian care cooperatives at the ILO last week. She noted that that there are 840 social cooperatives and enterprises in Italy now which benefit 700,000 users, employ 41,400 workers and 15,850 volunteers. Their annual turnover is €1.3 billion.

4) This leads us to the next question. What is the added value of cooperatives providing care?

The added value is two-fold, as it benefits the workers in cooperatives and their beneficiaries who receive care.

By and large, most care workers across the world are women. Many are informally employed, and many others are migrant workers. These groups are particularly vulnerable to exploitation and exclusion in the labour market. Furthermore, care work is often void of contracts, particularly for informally employed workers. And even when contracts do exist, they may not be enforced.

The participants of this ILO study reported that cooperatives are helping to address these issues in various ways. For example, many cooperatives provide workers with contracts that spell out terms and conditions. Respondents also reported that cooperatives provide care workers with better wages, as well as benefits like maternity and sick leave.

Across the care sector, the bargaining power of care workers is quite low – particularly women, informally employed, migrants, and even more so for those who work and even live in the home of their employer.

Our interviewees and survey respondents told us that being a part of a cooperative strengthens these workers’ negotiation power. As a cooperative member, care workers speak with the power of the cooperative behind them. This has a positive impact on wages, terms of work, workplace safety and working conditions.

In addition to all of this, we also see a potential for care cooperatives to be employers of other groups excluded from the labour market. According to Claudia Fiaschi, in Italy, up to 30 per cent of employees of social cooperatives are from such disadvantaged population groups, including prisoners, migrants, people with disabilities.

For the beneficiaries who receive care services from cooperatives, there is also an added value. Cooperatives are helping to professionalize care workers and their services, such as through training and certification. If you think about bringing a care worker to your home: bringing a care worker who is certified and associated with a registered enterprise helps the care recipient rest assured that the care provider is trained and competent in her job.

So the added value of cooperatives works both ways, for the workers providing and for the recipients of care. This way, cooperatives have significant potential to help to fill a major gap which has been highlighted in another recent ILO study: More than half of the global population aged 65 and above, representing 300 million people, is excluded from urgently needed long-term care.

Looking ahead, there is massive potential for job growth in the care sector. But the lack of decent work opportunities is a challenge that needs to be addressed. In the United States, for example, homecare is the number-one fastest-growing industry in the country, but homecare jobs are among the lowest paid (see US Department of Labour Statistics) .

In fact, homecare workers in the U.S. often earn poverty wages. Examples like this raise the question of how the situation of growing care can be made more sustainable for both care workers and care recipients. Cooperatives are emerging as one possible solution that is fairer for both.

5) What are the limitations and challenges for cooperatives in this field?

For start-up cooperatives the stakes are particularly high: financing is an issue, particularly in the enterprise formation and incubation phases. According to the study participants, securing sources of capital and knowing how and where to access financing can be a challenge.

Respondents shared that acquiring technical expertise can be another challenge; this writing contracts and learning relevant policies and legislation are examples of this. Recruiting staff can also be a challenge as cooperatives are newer and therefore also lesser known players in care provision. Moving forward, efforts to build awareness and share knowledge and expertise across stakeholders will help address some of these challenges.