Informal Caregiving, Employment Status and Work Hours of the 50+ Population in Europe

Nicola Ciccarelli,Arthur Van Soest

doi:10.1007/s10645-018-9323-1

Abstract

Using panel data on the age group 50–70 in 15 European countries, we analyze the effects of providing informal care to parents, parents-in-law, stepparents, and grandparents on employment status and work hours. We account for fixed individual effects and test for endogeneity of caregiving using moments exploiting standard instruments (e.g., parental death) as well as higher-order moment conditions (Lewbel instruments). Specification tests suggest that informal care provision and daily caregiving can be treated as exogenous variables. We find a significant and negative effect of daily caregiving on employment status and work hours. This effect is particularly strong for women. On the other hand, providing care at a weekly (or less than weekly) frequency does not significantly affect paid work. We do not find evidence of heterogeneous effects of caregiving on paid work across European regions.

Highlights

Informal caregiving refers to unpaid care provided by family members and friends, to individuals who are temporarily or permanently unable to function independently
Pooled ordinary least squares (OLS) and FD estimates for the effects of the caregiving variables on employment are reported in Columns 1–4 of Table 4.21 Using the pooled OLS estimator, we find that the coefficient on informal caregiving is positive and significant at the 5% level, suggesting that people who are active on the labor market tend to give informal care, but not necessarily reflecting any causal relationship
Since females are less attached to the labor market than males, and since females are more likely to provide daily care to “parents” than males, we investigated whether the effect of daily caregiving on employment and work hours differs across genders; estimates by gender for the effect of informal caregiving on employment and work hours are not reported, since in line with the results reported in Tables 4 and 5, the coefficient on informal caregiving is completely insignificant for both genders

Summary

Introduction

Informal caregiving refers to unpaid care provided by family members and friends, to individuals who are temporarily or permanently unable to function independently. Such care is currently the most common source of long-term care (see Costa-Font et al 2016 and references therein). The ageing of industrialized countries’ populations, and notably the growing number of the very old, is increasing the need for informal caregiving and, more generally, the need for long-term care services (Costa-Font et al 2015). From a policy point of view, it is important to understand whether caregiving has a negative impact on employment status or number of hours of paid work. Policies that reduce formal care opportunities or increase the costs of formal care will probably lead to more informal care, and it is important to know whether this has negative side effects on labour supply

Methods

Results

Conclusion