Blog June 14, 2016

Direct-Care Crisis Is an Opportunity: Let’s Take It

By Jodi M. Sturgeon

Today’s United State of Women conference at the White House includes among its themes, women’s economic empowerment. Women continue to earn 79 cents to every dollar a man earns. For women of color, the gap is even larger. African-American women earn 63 cents for every dollar earned by a man, Latinas, 54 cents.

There are multiple reasons for the stubborn persistence of these numbers, but one is certainly job segregation. Most female-dominated professions pay less than those dominated by men, and this is most certainly true of care work. Despite the immense value to society and the skills needed to do the work well, elder care and child care workers earn wages far below workers in male-dominated occupations such as construction, transportation, or maintenance and repairs.

In the lasScreen Shot 2016-06-14 at 8.50.35 AMt year, PHI has published two reports that shine a spotlight on direct-care workers, occupations that are 90 percent female. In the first, Paying the Price, we examined the poor quality of home care jobs. Home care workers—personal care aides and home health aides—earn average wages of $9.61 per hour. Despite the ever-increasing demand for these workers, real wages (adjusted for inflation) have dropped 5 percent over the last decade.

Home care workers’ wages are further impacted by the way home
care jobs are structured: nearly 60 percent of the workforce works part time. The result is a median annual income of $13,000. Wages are so low that more than half of home care aides live in households that rely on public assistance to support their families.

Raise the FloorIn a second report, Raise the Floor: Quality Nursing Home Care Depends on Quality Jobs, PHI examines wages for nursing assistants working in over 15,000 nursing homes nationwide. For these workers, the median hourly wage is $11.51. These workers also have difficulty getting full-time work, reducing median annual incomes to $19,000. One in three nursing home workers lives in a household relying on public benefits.

These low wages, along with other job quality issues such as insufficient training, limited on-the-job support, and inadequate career paths, lead to very high levels of turnover in both home care and nursing home jobs, affecting the continuity and quality of care for consumers. The Eldercare Workforce Alliance came into existence following the 2008 Institute of Medicine report, Retooling for an Aging America, that highlighted, among other issues, the serious problems facing our nation if we did not invest more in the direct-care workforce. Yet little has changed.

Why do wages remain so low despite the impact of poor quality jobs on consumer care? That brings us back to the United State of Women, and the marginalization of this predominantly women of color workforce. Competing against more powerful economic interests—those of providers, consumers, and state and federal governments that benefit from low wages—direct-care workers haven’t been able to change a deeply ingrained system that accepts high turnover and compromised care quality as the price of keeping costs down.

But in a recent article in Generations, Steven L. Dawson argues that that dynamic is changing, in part because of our country’s changing demographics. High demand for direct-care services, along with a shrinking pool of paid caregivers, is rapidly increasing vacancy rates. Providers unable to meet the needs of potential clients are feeling the pain more acutely than they have in the past. Consumers, too, perhaps facing early retirement because they cannot find someone to assist a loved one, may have to reassess the value of care. And state Medicaid programs, despite the desire to keep costs down, must attract enough caregivers to support community living.

As economist Paul Romer has said, “a crisis is a terrible thing to waste.” With the shift in economic incentives for long-term care stakeholders, we have a window of opportunity to press for systemic changes in how we train, compensate, and support direct-care workers. An empowered workforce that is respected and valued, and compensated appropriately, will contribute greater value and strengthen our overall system of care. That is worth paying for.

Jodi M. Sturgeon is the president of PHI, the nation’s leading expert on the direct-care workforce. PHI advocates for improving the quality of care for elders and people living with disabilities through improving the quality of jobs for direct-care workers.