AARP has released dramatic data about the impact of an aging population on family members and professionals that serve as caregivers. The organization's study confirmed what is already well-known to many adult sons and daughters: the work of caring for aging loved ones in need of assistance is largely done by their adult children. And as our population demographics swing older, this increasingly will be the reality -- and challenge -- for more of us.
Within 15 years, 20 percent of America will be senior citizens; by 2050, more than 30 percent will be over 65. While that's a significant jump in only two decades, it's a dramatically steeper climb from 1950, when only seven percent of the population was 65 or older. Family members have traditionally been the "first responders" of elder care, with the oldest daughter typically the person thrust into the role of care provider. In her mid-fifties, she is usually employed and has a family of her own, hence the term "sandwich generation" coined to describe adults in their 40s and 50s who are financially supporting both a parent(s) and child(ren). How many of us adults would that describe? Nearly half.
Yet few of us are properly trained, or emotionally prepared, for the stress and strain of doing so, and the consequences that result. When I left a lucrative Wall Street job a little more than four years ago to help find care for my sister with multiple sclerosis and an uncle with ALS, I learned first-hand about the depression, stress, headaches and sleepless nights that family caregivers endure. The financial impact also is quite devastating for family caregivers and the companies that employ them. Indeed, lost productivity from full-time employees with elder care obligations is estimated at a staggering $33.6 billion.
And here's what additional demographic shifts come into disruptive play. As AARP points out, when today's care-providing adults need help themselves, their options will be limited. Families are simply not as large as they once were. While today there are seven potential caregivers for every senior over the age of 79, that ratio is predicted to drop to 3 or 4 to 1 by 2030. That means more of us will be compelled to seek help from professional caregivers, either in the home or at a nursing facility.
Alarmingly, the existing healthcare workforce is ill-prepared for the continued graying of America. As in-home caregivers lack the standard minimum pay protections provided under the Minimum Age Act enacted in the seventies, most of the millions working as nurse aides and caregivers earn less than $25,000 annually and lack any specialized training to manage geriatric health issues, the Brookings Institute has warned. At a time when demand for their services is rising, there are few economic incentives to attract more qualified professional caregivers and limited resources available to help them succeed.
Fortunately, government and industry are slowly waking up to the challenges. On the legislative front, progress can be seen at both the federal and state level, though with varying degrees of success. The Obama Administration had been working to remove minimum wage and overtime exemptions for in-home caregivers, but was temporarily thwarted as home care worker agencies successfully challenged the proposed amendment in court. Some states have picked up the slack, providing the requisite pay minimums themselves. Organizations such as AARP, the Domestic Workers Alliance, and other advocates for the elderly and their caregivers have done an admirable job pressing for fair pay.
Technology will also play a vital role. Four years ago, I saw an opportunity to create a national online marketplace to connect families and caregivers with a model that dramatically increases the pay of professional caregivers while making their services available at about half the rate agencies charge. Silicon Valley has taken note of our success: venture capitalists, including Silicon Valley luminary Marc Andreessen, recently entered our space with some very significant investment capital. We expect significantly more competition, which will ultimately benefit families. The previous high cost of hiring in-home caregiving assistance no longer has to be the insurmountable obstacle that put far too many seniors in nursing care facilities. Nine out of 10 seniors say they want to age in place at home and for good reason; those that are able to do so enjoy a far greater quality of life and longer good health than those that cannot.
As the Baby Boomers continue to swell the ranks of our senior population, elder care concerns will impact more and more families. It's a global trend in dire need of solutions. While we are beginning to see positive steps, we still have a long way to go.