• Q&A
  • August 2, 2018
  • 7 minutes
  • 0

Ageing populations could create a care crisis — or millions of jobs

Just 5.6% of people live in countries that provide long-term universal care coverage

The silver tsunami is approaching: many countries, not all of them rich, are facing the challenges of an ageing population thanks to growing life expectancies and shrinking birth rates.

This threatens a humanitarian and economic crisis. Elderly people need care, which in almost all countries is inadequately provided: just 5.6% of the global population lives in countries that provide long-term universal care coverage based on national legislation. And care requires money, of which the state will have less as more people edge into retirement.

But there is also an opportunity here. There is already a huge unmet demand for care workers — and this will only grow. Moreover these jobs, requiring delicacy and interpersonal skills, will resist automation for much longer. Researchers have argued that big, strategic investments in care work by the state could not only avert a care crisis, but revamp sluggish economies.

We spoke to Laura Addati of the United Nation’s International Labour Organisation about the future of the care economy. The conversation has been edited for length and clarity.

What is driving the elderly care crisis?

There are a number of concomitant factors: the fact we will have 200 million more elderly by 2030, the increase in people that will require care, the fact that in many countries more people are now working, the fact that families are becoming smaller. It’s urgent that we take action.

If we don’t address it now, what will happen?

On the one hand we will have care recipients not receiving adequate care. But it will also affect the working conditions of those providing care work. We’re already seeing a pressure on care workers because the number is insufficient.

And in terms of unpaid care, we suspect that often men or women will not be able to provide the care because of the pressure to work. And when provided it comes at a cost, often in terms of the labour market for women. So there are social or economic costs. The drop in GDP in high income countries really points to that choice. Not having children might be the only work-family balance solution to cope with the lack of support.

“These workers are low-pay, informal. This is what happens when the state does not take a leading role”

Can we rely on markets to solve the problem?

We call for four principles for transformative care policies. One is the predominant role of the state. The others are that the benefits should be universal, adequate and gender-responsive.

The data shows that when left to the markets, the result is that the conditions of the workers deteriorate. There’s a race to the bottom. Care work ends up relying on migrants, who are often unregulated and unprotected.

If we look at long-term care, 60% of workers in OECD countries are working in private households. These workers are low-pay, informal. This is what happens when the state does not take a leading role in regulating, financing and providing long-term care services.

Which countries are leading the way and what are they doing?

In terms of having an adequate system, where long-term care services are accessible and affordable, and workers are protected, it’s the Nordic countries: Sweden, Finland, Norway. The Netherlands too. They include long-term care, both home-based and institutional, as part of a universal healthcare system.

Uruguay has done something novel. They are looking at care needs in an integrated manner. Not only care for the elderly, but care for children. They have built a national care system that is guaranteeing the right to care services for their public.

Then in Italy, there are opportunities for long-term care leave. Public and private sector employees can take [three days leave per month] to look after a family member with the right to return to work. The entitlement is for two years, with full earnings [paid by the government].

“This is not expenditure: it’s investment”

There is a trend in some countries to resort to cash transfers. This “cash for care” can be used to hire a domestic worker or to pay for a family member, most often a woman, to take care of the elderly parent or relative.

The problem with these cash transfers is that they are not gender-responsive. And the level is so low that they don’t really compensate the lost hours of work, and they don’t pay for a qualified care professional. So they end up incentivising precarious work.

Can governments with ageing and shrinking populations still afford long-term care for their elderly?

We argue that this is not expenditure: it’s investment. If we want to guarantee the SDGs — universal care, education etc. — it needs to be made. It will also create jobs, so it’s a powerful solution for revamping economies. This is where the needs are high — and it will remain a source of employment because of the nature of the work. But there’s also a multiplier effect: we see that investing in care sectors results in additional indirect jobs generated in other sectors. — Tom Graham

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