The sector has faced soaring demand for years. But rises in national insurance and wages could prove "potentially disastrous" for firms, one expert said.
More than two million who require care go without it and Mike Padgham, chair of the Independent Care Group which speaks for some businesses, said: "The lack of understanding of the impact these cost increases will have on social care providers beggars belief and reveals a total lack of understanding over how social care works." Changes unveiled by Chancellor Rachel Reeves will hike employers' NI levy by 1.2% while lowering the threshold at which firms pay it.
The reforms come as record numbers of frail, vulnerable and elderly patients need round-the-clock help.
Mr Padgham went on: "The bulk of social care delivery, through home care and residential and nursing care, is delivered by small to medium-sized businesses that are employee-heavy.
"Huge increases in the costs those providers face - through employer's NI rises and increases in the national living and national minimum wages, without an injection of funding to help them cope is potentially disastrous." The rises will add £14,000 to average monthly wage bills and hit recruitment and investment.
The figure is a calculation of the effect of the NI rise from April on an independent provider running two care homes, with 212 staff.
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