Increasing direct care workers’ pay to a living wage would not only raise their total wages by $9.4 billion by 2022, it would also lead to several benefits for operators, including less staff shortages and turnover costs, an industry study has revealed.
According to findings from a new analysis by LeadingAge, raising wages to at least a “living” wage — which allows a family of three to live out of poverty — in 2022 would benefit 75% of direct care workers, including nursing assistants and personal care aides. Those who don’t make a living wage would earn a pay increase of $5 billion by 2022 and those who do earn a living wage would see an indirect pay raise of about $500 million.
Additionally, researchers found that adopting a living wage would, in turn, increase hours for workers and result in an additional $2.24 billion in pay. It would also attract more people to the profession.
According to the report, “Making Care Work Pay: How Paying at Least a Living Wage to Direct Care Workers Could Benefit Care Recipients, Workers and Communities,” 1 in 8 direct care workers live in poverty, and more than half received public health benefits in 2018. About 48% of direct care workers earned less than a living wage in 2018, earning, on average, $13.36 per hour last year. A majority (84%) lacked retirement benefits through their employers in 2019, and 14% had no health insurance.