What is changing and why it matters
The UK's social care model depends on migrant labor. The Work Rights Centre estimates roughly one in three workers across adult social care are migrants. Between February 2022 and July 2025, around 280,000 people came to Britain on the Health and Care Visa, and those visa holders brought 429,200 dependents, many of whom also moved into care roles.
That route was later put on ice by the Labour government over abuse concerns. When the visa was halted, Labour, led then by Keir Starmer, was trailing Nigel Farage's Reform UK in polling. With immigration high on voters' lists, in September 2025 the party installed Shabana Mahmood as home secretary and asked her to tighten rules both for new arrivals and for non-citizens already in the country.
Ministers have indicated that from July 2028, the Health and Care Visa will not be renewable. Workers would instead need to move to the Skilled Worker category, which carries a much higher salary floor. Providers that rely on local authority contracts say that funding does not stretch to those pay levels.
Why care providers are sounding the alarm
The combined domiciliary care and supported living market is worth about £15 billion, yet operators say the proposed shift would blow a hole in their wage bills. "I will have to either downsize or just sell to a corporation," said Shweta Maulayah, managing director of Maucare. "This is something that I built with passion, but I would not be able to financially keep it afloat."
Today, most migrants can seek settlement after five years. On that timeline, many carers who arrived in 2022 and early 2023 would hit eligibility just as the Health and Care Visa sunsets. Mahmood, however, has suggested doubling the default residency period to 10 years; quicker routes would be available to high earners and to people whose volunteering amounts to an exceptional contribution.
Maulayah began overseas hiring in January 2023, leaving her with staff who would miss settlement before the July 2028 cutover if the baseline doubles. She also struggles to recruit domestically. "We're not getting a lot of locals joining this industry," she said.
"Even youngsters that go to career fairs, they're not that interested because they feel that care is a low-skilled job. One of them said to me, 'I'd rather stack shelves in Tesco,'" she added, alluding to Tesco Plc's supermarket group.
An owner of a home-care firm in southern England, speaking anonymously about business decisions, said policy uncertainty has pushed her to weigh a sale or closure. Even if care workers get carved out of Mahmood's plan, she said current limits on overseas hiring would still undercut viability because her local authority contracts do not support wages that would attract enough British workers.
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The settlement plan and the political pushback
Mahmood's proposal to extend the baseline residency period has met friction inside Labour. According to the Times, Prime Minister Andy Burnham is inclined to remove care workers from the longer timeline, though it is not clear whether the Home Office would agree to exemptions for Health and Care Visa holders.
In March, Bloomberg reported that over 100 parliamentarians signed a private letter asking the home secretary to reconsider. Left-leaning Labour MPs have also set out asks, said a person familiar with the discussions: do not apply new settlement clocks to those already here, let people in the same household follow the same timeline, and cap the maximum wait for settled status at seven years.
Senior ministers have stayed quiet on the reforms. Energy Secretary Miatta Fahnbulleh and Housing Secretary Angela Rayner have declined to endorse them publicly. Mike Tapp, who previously served at the Home Office and collaborated with Mahmood on the package, has called for care workers to be carved out.
At Labour's annual conference last month, Mahmood acknowledged criticism. "I know that, throughout our consultation process, some have said elements of these reforms are not fair," she said. "We will come to a position that balances fairness for those who came here legally and fairness to British citizens across this country." Speaking to reporters on Friday, Burnham avoided a blanket commitment to the full plan. "We've been consulting on those reforms, and we will come forward with our decisions soon," he said. "But I strongly support the Home Secretary when she says that settlement is a right to be earned through contribution."
Proposals are due next month. The Home Office did not respond to Bloomberg's requests for comment.
The industry backdrop and investor angle
The sector was already stretched in 2022 after many EU workers left post Brexit while an older population drove steady demand. Later inflows from countries including India and Nigeria filled gaps, but abuses emerged. A Bloomberg investigation last year found some agencies using sponsorship rules to charge carers tens of thousands of pounds for visas, only for those workers to discover there was no job on arrival.
If the current direction holds, workers who expected to extend their Health and Care Visa before July 2028 would face shifting to the higher paid Skilled Worker route, and many who would have reached the existing five year mark could be pushed to a 10 year bar unless they qualify for reductions. That mix - higher salary thresholds and longer paths to settlement - is exactly what providers and some Labour MPs want rethought.
For investors, watch two dials: staffing supply and contract economics. The £15 billion home- and supported-living market runs on local authority funding, so wage floors and settlement timelines directly influence capacity, consolidation pressure, and margins. Track the formal proposals next month, any carve-outs for care workers, and whether the maximum to claim settled status lands closer to seven years.
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