diff --git a/CHANGELOG.md b/CHANGELOG.md
index b6c14dca3..d23d11cd2 100644
--- a/CHANGELOG.md
+++ b/CHANGELOG.md
@@ -1,5 +1,9 @@
 # Changelog
 
+## v5.3.2
+
+* [feat: enable experimentalFileCaching by default](https://github.com/TypeStrong/ts-loader/pull/885) (#868) - thanks @timocov!
+
 ## v5.3.1
 
 * [fix: projectReferences with rootDir](https://github.com/TypeStrong/ts-loader/pull/871) (#868) - thanks @andrewbranch!
diff --git a/README.md b/README.md
index dd3e8f395..bdf4e2070 100644
--- a/README.md
+++ b/README.md
@@ -248,6 +248,8 @@ It's advisable to use this with the [fork-ts-checker-webpack-plugin](https://git
 
 This will ensure that the plugin checks for both syntactic errors (eg `const array = [{} {}];`) and semantic errors (eg `const x: number = '1';`). By default the plugin only checks for semantic errors (as when used with ts-loader in `transpileOnly` mode, ts-loader will still report syntactic errors).
 
+Also, if you are using `thread-loader` in watch mode, remember to set `poolTimeout: Infinity` so workers don't die.
+
 #### getCustomTransformers _( () => { before?: TransformerFactory<SourceFile>[]; after?: TransformerFactory<SourceFile>[]; } )_
 
 Provide custom transformers - only compatible with TypeScript 2.3+ (and 2.4 if using `transpileOnly` mode). For example usage take a look at [typescript-plugin-styled-components](https://github.com/Igorbek/typescript-plugin-styled-components) or our [test](test/comparison-tests/customTransformer).
@@ -543,14 +545,12 @@ Extending `tsconfig.json`:
 
 Note that changes in the extending file while not be respected by `ts-loader`. Its purpose is to satisfy the code editor.
 
-#### experimentalFileCaching _(boolean) (default=false)_
+#### experimentalFileCaching _(boolean) (default=true)_
 
-By default whenever the TypeScript compiler needs to check that a file/directory exists or resolve symlinks it makes syscalls.
-It does not cache the result of these operations and this may result in many syscalls with the same arguments ([see comment](https://github.com/TypeStrong/ts-loader/issues/825#issue-354725524) with example).
+By default whenever the TypeScript compiler needs to check that a file/directory exists or resolve symlinks it makes syscalls. It does not cache the result of these operations and this may result in many syscalls with the same arguments ([see comment](https://github.com/TypeStrong/ts-loader/issues/825#issue-354725524) with example).
 In some cases it may produce performance degradation.
 
-This flag enables caching for some FS-functions like `fileExists`, `realpath` and `directoryExists` for TypeScript compiler.
-Note that caches are cleared between compilations.
+This flag enables caching for some FS-functions like `fileExists`, `realpath` and `directoryExists` for TypeScript compiler. Note that caches are cleared between compilations.
 
 #### projectReferences _(boolean) (default=false)_
 
diff --git a/examples/thread-loader/webpack.config.js b/examples/thread-loader/webpack.config.js
index 7f5e6d314..727582e60 100644
--- a/examples/thread-loader/webpack.config.js
+++ b/examples/thread-loader/webpack.config.js
@@ -17,6 +17,7 @@ module.exports = {
                     options: {
                         // there should be 1 cpu for the fork-ts-checker-webpack-plugin
                         workers: require('os').cpus().length - 1,
+                        poolTimeout: Infinity // set this to Infinity in watch mode - see https://github.com/webpack-contrib/thread-loader
                     },
                 },
                 {
diff --git a/package.json b/package.json
index 996cdc2fa..6f2660c7b 100644
--- a/package.json
+++ b/package.json
@@ -1,6 +1,6 @@
 {
   "name": "ts-loader",
-  "version": "5.3.1",
+  "version": "5.3.2",
   "description": "TypeScript loader for webpack",
   "main": "index.js",
   "types": "dist/types/index.d.ts",
diff --git a/src/index.ts b/src/index.ts
index 2fe667793..62339c30a 100644
--- a/src/index.ts
+++ b/src/index.ts
@@ -313,7 +313,7 @@ function makeLoaderOptions(instanceName: string, loaderOptions: LoaderOptions) {
       // When the watch API usage stabilises look to remove this option and make watch usage the default behaviour when available
       experimentalWatchApi: false,
       allowTsInNodeModules: false,
-      experimentalFileCaching: false
+      experimentalFileCaching: true
     } as Partial<LoaderOptions>,
     loaderOptions
   );
diff --git a/test/comparison-tests/run-tests.js b/test/comparison-tests/run-tests.js
index 794bbc09c..625b47e1d 100644
--- a/test/comparison-tests/run-tests.js
+++ b/test/comparison-tests/run-tests.js
@@ -123,12 +123,14 @@ function runTestAsChildProcess(testName) {
       testCommand + (saveOutputMode ? ' --save-output' : ''),
       { stdio: 'inherit' }
     );
+    /* No longer necessary and experimentalFileCaching is enabled by default - approach may prove useful in future though
     if (!saveOutputMode) {
       const _testOutput2 = execSync(
         testCommand + ' --extra-option experimentalFileCaching',
         { stdio: 'inherit' }
       );
     }
+    */
     return true;
   } catch (err) {
     return false;