Immigrant Workers and Care for America’s Elderly

The Issue:

As the U.S. population ages, there will be increased demand for health aides and other workers that support aging in place or provide institutional care for the elderly. Currently, immigrants supply a large and increasing share of this labor. However, the proportion of foreign-born workers in local labor markets varies greatly across the country. This means that the cost and the types of options available to support and care for the elderly might vary, depending on the local pool of labor available. We find that in areas of the country with a higher proportion of less-educated immigrants in the working-age population, U.S.-born people aged 65 and older are less likely to be living in an institutional setting and more likely to be aging in place.

The availability of immigrant workers can impact the options available to care for the elderly, as well as the quality of care they receive.

The Facts:

• The U.S. population is aging. The number of people aged 80 and up relative to the working age population, those between the ages of 16 and 64, is 6.1 percent as of 2019. Using the 2017 National Population Projection Tables from the U.S. Census, we estimate that the share of people 80 and over relative to the working age population could reach 9 percent by 2030. This represents a nearly 50 percent increase in the number of elderly relative to the working age population over the next decade.
• Disability rates climb as individuals age, and the oldest typically need assistance with activities of daily living. For example, in 2019, over 40 percent of those of those aged 80 reported some form of difficulty with cognition, mobility, taking caring of themselves, seeing, and/or hearing. This figure rises rapidly with age and is above 70 percent for those aged 89. Surveys suggest that, if possible, the elderly prefer to “age in place” with support rather than to live in an institution. And, among those over 65 with disabilities who do age in place, over 35 percent report hiring formal home care.
• Services that allow the elderly to age in place or receive high-quality institutional care are often provided by immigrants. The foreign-born make up a disproportionate number of workers in the health care sector and the home services sector. Although — as of 2019 — immigrants represent 17 percent of the overall workforce, they are 26 percent of health diagnostic workers (doctors, dentists, etc.), 28 percent of home health aides, and 46 percent of housekeepers and gardeners (see chart).  Naturally, these numbers vary geographically – immigrants compose 51 percent of the health aide provider workforce in the state of New York but only 4 percent in West Virginia, for example.
• For a portion of the aging population, the choice between institutional care and aging at home with household support can depend on what is locally available. Services to care for the elderly rely on a mix of less‐educated labor, more‐educated labor, and capital. The care that takes place in institutions tends to be more capital‐intensive than home‐based care. A robust supply of less‐educated workers may lead to greater use of caregiving services that are less capital intensive and more likely to be based in a home setting. 
• Emerging evidence indicates that immigration lowers institutionalization rates among the elderly. Our own recent research shows that, after accounting for potential confounding factors, a 10 percentage point increase in the less-educated foreign-born labor force share in a local area reduces institutionalization among the elderly by 1.5 percentage points (or 29 percent). Our estimates imply that a typical U.S-born individual over age 65 in the year 2000 was 0.5 percentage points (10 percent) less likely to be living in an institution than would have been the case if immigration had remained at 1980 levels. This is because caregiving labor is more available and affordable in areas with higher immigrant shares. Other recent work finds similar results. 
• The relative abundance of foreign-workers who can provide care for the elderly in a local labor market can also impact the outcomes for those living in a nursing home. Research using a similar methodology by Delia Furtado and Francesc Ortega finds that a 10 percentage point increase in the foreign-born labor force share is associated with a 35 percentage point reduction in the standardized proportion of nursing home residents who recently experienced a fall. Availability of workers to attend to basic caregiving tasks frees registered nurses to specialize in taking care of the tasks that require a specialized degree. Prior research has also found that staffing levels in nursing homes are tied to mortality among the elderly.
• Immigrant caregivers may help adult children of the elderly balance work and care responsibilities. Evidence from Austria shows that health shocks of an elderly parent affect the labor supply of adult children, particularly daughters and those who live nearby. The researchers find that an expansion of the supply of immigrant caregivers muted the effects of elderly health shocks on their adult children’s ability to work.