Who cares for the caregivers

OECD Observer Business brief

"Even marginal shifts in public policy or human resource design can have a very positive impact on an employee’s current state and healthy retirement prospects."





Bradley Schurman, MA
Senior Advisor, AARP

Consistent careers are a hallmark of a successful retirement. However, too often, workers are called away from employment to care for loved ones, both young and old. Without adequate government or employer protections, workers risk losing valuable years of prime income earning and retirement contribution potential, while being paid nothing to take care of sick or disabled family. Workers also risk losing valuable skills that could dampen their prospects for re-employment.

Caregiving is an issue that affects both sexes. However, in the US, this issue has a disproportionate effect on women, who account for 66% of all caregivers. According to a 2009 study by the National Alliance for Caregiving and AARP, the typical caregiver in the United States is a “49-year-old woman caring for her widowed 69-year-old mother who does not live with her. She is married and employed.” This challenge will only increase over the coming decades as more women enter the workforce and populations age.

A worker’s pension benefits are typically tagged to lifetime earnings, so any disruption to those earnings over a lifetime has a negative impact on pension and retirement savings. This forces workers to work longer to achieve the same retirement goals as their counterparts who are not engaged in caregiving. The irony to all of this is that informal caregiving saves the US economy nearly US$400 million each year.

The case for older workers and caregiving models

Workers over 50 are highly valuable within many organisations– particularly in those industries that require highly skilled workers or workers with unique skill sets, such as in healthcare or energy. However, these older workers often require flexible working arrangements to care for their children or their parents.

According to a recent AARP study, in the US in 2002, workers over 50 made up 24.6 % of the workforce. By 2012, they were 32.3% and by 2022 they are projected to represent 35.4% of the total workforce. These numbers are much larger in other OECD countries like Japan and Korea.

Some 65% of workers over 55 are considered “engaged,” while younger employee engagement averages 58-60%. Some 5% engagement equals 3% incremental revenue growth.

Government response

In some cases, governments around the world have begun to answer the call for greater equity in retirement by offering caregiver credits to workers who have to reduce hours or leave the workforce due to short-term caregiving responsibilities. These caregiver credits allow workers to continue to earn for retirement while caring for a loved one. This is a good first step that hasn’t yet been embraced by the US.

There are also innovative examples from countries that are experimenting with caregiving leave. For example, in Germany multiple programmes allow workers time for caregiving, including paid leave and caregiving leave.

Private-sector response

Governments are not the only entities working to make caregivers lives better. Innovative corporations identified through AARP Best Employers International are doing so too.

ThyssenKrupp, a German multinational corporation and one of the world’s largest steel producers, has a life-phase-oriented human resources policy, called ProZukunft. ThyssenKrupp offers its employees approximately 400 different working time models that are individually tailored to personal needs.

ThyssenKrupp supports child caregivers through its on-site, company-owned childcare centre. It supports adult caregivers through a nursing hotline, in co-operation with Novitas BKK Krankenkasse, and, through company-owned services, advises employees on eldercare options.

On the other side of the planet, financial institution Westpac Group was among the first Australian organisations to address issues pertaining to an older workforce.

Westpac has pioneered a flexible work environment for older employees and continues to expand such arrangements for older workers through innovative policy, and through toolkits supporting flexible work practices. Employee resources include the Westpac Group Carer’s Concierge, a resource for employees who have older adult care responsibilities.

In conclusion, the best caregiving leave innovations are happening in countries with the longest history of strong social welfare, and at companies seeking to recruit and retain older and more experienced workers. There is much the US and other countries can learn from these examples. However, little will be done without a stronger business case, and increased demand for skilled workers.

There are still many challenges that face low-skilled workers, regardless of geographic location. However, governments and employers are realising the challenges facing employees who are caregivers. Even marginal shifts in public policy or human resource design can have a very positive impact on an employee’s current state and healthy retirement prospects.

For more information about AARP or AARP Best Employers International, please contact Bradley Schurman at bschurman@aarp.org.

Read more at www.oecd.org/forum/oecdyearbook   

Visit www.aarp.org


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