L’EMbeDS DS^3: "More Care, Less Cash? Unpacking the EU’s caregivers labor market losses in late career"

The DS³ organizing group, alongside the L'EMbeDS Department of Excellence of the Sant'Anna School for Advanced Studies, is launching a new online seminars series devoted to frontier research in data science, its applications and its implications across disciplines.  

The L'EMbeDS Data Science Seminar Series (L'EMbeDS DS³) hosts national and international scholars to discuss cutting-edge methodology, applications in economics, the social sciences -- and beyond, societal implications and governance issues.

For announcements and further information please visit our web page and join our Google Group.

The seminar will feature Tallys Feldens (Sant'Anna School of Advanced Studies), who will present a talk entitled: “More Care, Less Cash? Unpacking the EU’s caregivers labor market losses in late career”

>>Join the event via the following link

ABSTRACT:  

Informal caregivers are an important complement to formal healthcare, especially by helping the patients with their daily activities, which prevents institutionalization. However, by providing informal care, people might be giving up paid working hours, which can also affect their propensity to retire when they are in late career. Thus, it is important to ascertain the amount of change in working hours, personal income and transition to retirement that is linked to informal caretaking. Data from 2006 to 2022 of the Survey of Health, Ageing and Retirement in Europe (SHARE) is used to collect the individuals over 50 years who reported to have helped people inside or outside their household with personal care, practical household help or help with paperwork. We explored three datasets: the ones who became a caregiver, the ones who left the caregiver role, and those who left the caregiver role due to the death of the care receiver. We compared these three samples against the ones who were never caregivers and employed an event study estimation. To account for the (possibly) non-random allocation in the choice and ability to become a caregiver, the first step in the analysis entailed a propensity score matching (PSM) selecting only those who retain similar observable characteristics. Becoming a caregiver is associated with lower employment income, raising pensions income and a higher chance of retirement. This trend is not reversed when people leave the caregiver roles: either for the ones who stop caregiving for any reason or for the ones who experienced the death of the cared person, the aggregated dynamic effects point to a reduction in employment income and raise in the pension’s income. We investigated age, gender, place of caregiving, country of residence and inter-household effects. These results indicate that caregiving roles have short to medium-term effects and probably affect the late-career choices of the ones who have someone to take care of. Although the provision of informal care can contribute to social support and even generate savings to the health care system, our estimates show that it has a non-negligible impact on late-career choices. Specific policies should address this important trade-off and estimate incentives to decrease the burden of informal care and its financial implications without compromising productivity and human capital losses.