With the aging of Japanese society, the demand for care services for the elderly is rapidly increasing. It is already difficult to provide enough care services, and we anticipate an enormous increase in costs for care services in the future. To cope with these situations, it is of paramount importance to improve the efficiency of the long-term care service industry.
Previous studies found that the better-managed establishments recruit and retain workers with higher capabilities and achieve higher productivity. The establishments with better management practices have been found to provide higher quality service in the case of non-profit organizations, such as hospitals and schools.
Our study examines the relationship between labor productivity and management practices in Japanese intensive care homes for the elderly. We find a positive relationship between the management practices and each of the following: labor productivity, ICT and robot adoption, and manager's hours spent improving services. On the other hand, there was no correlation between the management practices and the retention rate of workers or the shares of aged workers.