Economic Spillover Effects of Intensive Unpaid Caregiving

Growing evidence has documented economic spillover effects experienced by intensive caregivers across the lifecycle. These spillover effects are rarely incorporated in economic analyses of health interventions. When these costs are captured, it is shown that commonly applied methods for valuing caregiver time may be underestimating the true opportunity costs of informal care. We explore how intensive caregiving is associated with economic outcomes for caregivers aged 18 years and older.

We used the cross-sectional 2013 RAND Survey of Military and Veteran Caregivers, a survey of 3876 caregivers and non-caregivers aged 18 years and older to conduct multivariable analyses and calculate average marginal effects, focusing on the association between intensive caregiving (i.e., providing ≥ 20 h of weekly care) and six economic outcomes: schooling, labor force participation, taking unpaid time off of work, cutting back work hours, quitting a job, and early retirement.

Intensive caregivers are 13 percentage points (95% confidence interval [CI] 8-18) less likely to be employed than non-caregivers. Intensive caregivers are 3 percentage points (95% CI 0.5-5) more likely to cut back schooling, 6 percentage points (95% CI 2-10) more likely to take unpaid time off of work, 4 percentage points (95% CI 0.1-9) more likely to cut back work hours, 12 percentage points (95% CI 8-15) more likely to quit a job, and 5 percentage points (95% CI 2-7) more likely to retire early due to caregiving responsibilities relative to non-intensive caregivers.

Despite the difficulty of quantifying the true opportunity costs of informal care, policy makers and researchers need to understand these costs. The higher the opportunity costs of unpaid care provision, the less likely it is that caregivers will provide this care and the less economically attractive this 'free' source of care is from a societal perspective.