Did Minimum Wage Policy Changes Impact Home Health Workforce?

Area of Science:

• Health Economics
• Labor Economics
• Public Policy

Background:

• The home health aide (HHA) workforce faces shortages exacerbated by low wages.
• Minimum wage (MW) policies are potential interventions to address workforce shortages.

Purpose of the Study:

• To examine the impact of MW policies on HHA wages and employment.
• To assess the combined effects of state MW increases and the Fair Labor Standards Act (FLSA) extension.

Main Methods:

• County-level longitudinal analysis using national data from 2012 to 2018.
• Inclusion of 2,496 counties and all workers in the home health industry.
• Analysis of consumer price index-adjusted state MW and FLSA extension variables.

Main Results:

• HHAs in states with MWs above $10 saw a $1.00 increase in hourly wages compared to those below $8 (p = .011).
• The FLSA extension correlated with a $1.15 wage increase in states with MWs above $10 (2014).
• The FLSA extension positively impacted HHA employment in less-competitive labor markets.

Conclusions:

• State MW increases, especially when combined with the FLSA extension, can improve HHA wages.
• These policy changes may help stabilize and enhance the home health workforce.
• Targeted MW policies show promise for addressing labor shortages in the home health sector.