Originally posted on The Hill
President Trump boasted in his State of the Union address that his infrastructure plan would generate a $1.5 trillion investment, but he provided few specifics on where that money would come from. From what we know, the federal portion of this infrastructure spending would be paid by cutting existing transportation funding. The plan shifts financial responsibilities from the federal government to localities and relies on the invisible, and often absent, hand of the private sector. It would likely worsen regional inequality because many underfunded areas most needing infrastructure investments will remain unable to attract private investors or raise enough funds on their own.
To be sure, a well-designed infrastructure plan is long overdue to fix our D+ infrastructure, as graded by the American Society of Civil Engineers, but the new plan does not provide real solutions, nor does it address our nation’s great need for an ambitious jobs strategy. We’ve got an idea that holds far more promise: Build a caregiving infrastructure that will actually meet the current and future needs of our families
Despite the 17-year low in the U.S. unemployment rate, at 4.1 percent in January, a careful look at other key economic indicators raises concerns. The labor force participation rate for working age Americans is still down from pre-recession levels. The decline of women’s labor force participation is even more prominent, partly due to barriers such as caregiving responsibilities. Public investments in good caregiving jobs would be a win-win by empowering people with caregiving responsibilities to work.The Bureau of Labor Statistics projects that over the next decade, the aging of our population will demand the creation of 1.2 million more home health and personal care aide jobs. Right now, these jobs are poverty jobs as median annual earnings are $22,600 for home health aides and $21,920 for personal care aides. High percentages of both rely on public benefits. Low wages drive high rates of turnover and are already leading to worker shortages.
All of this compromises the continuity and quality of care. These problems are caused partly by limited public financing, with half of funding for long-term services and supports coming from Medicaid, and generosity varies greatly by state. The opportunity before us is to make sure these jobs are good jobs so that the sector can actually grow to meet the demand, as well as reverse a dwindling middle class.
Similarly, on the child care front, insufficient funding means that many families are left without support and child care workers are poorly paid. Median annual earnings for child care workers are $21,170. Such low pay becomes a major barrier for workers to join or continue in the field. Here again, inadequate public investment is a major driver. Two-thirds of public funding for child care is provided through the Child Care Development Fund (CCDF), but only 16 percent of all children eligible under federal rules received subsidies in 2013.
Direct investments to subsidize child care and long-term care costs and enhance wages for caregivers can expand the market for paid care. New funding should be devoted to expand center-based early care, with costs mostly covered by the federal government and some cost-sharing with states, localities and parents. To enhance the existing long-term care system, we can establish a universal catastrophic long-term care insurance program, providing relief to those who need catastrophic care while alleviating state Medicaid costs.
The federal government should also gradually increase the baseline hourly wage to $15 for caregiving workers. Other family-friendly policies such as inclusive and universal paid family and medical leave will improve employment outcomes. Building off of existing programs and systems, these investments would be well-targeted, creating jobs and increasing employment for families and communities who most need them.
In fact, state efforts to expand the caregiving workforce are gaining momentum in blue, red, and purple states. In 2017, Hawaii created the Kupuna Caregivers program to subsidize costs for assistance like hiring a home care aide for qualified working family caregivers. Oklahoma expanded CCDF eligibility and subsidies to include more children and families, and implemented universal pre-K in 1998, among the first states in the nation to do so. Today, Oklahomans have some of the best public preschools in the country. In Maine, a new referendum campaign is underway to guarantee in-home support to all residents over 65 years of age and people with disabilities.
Investment in the care sector can generate twice as many jobs per dollar as physical infrastructure construction due to the caregiving sector’s high labor intensity. These jobs are not easily offshored or automated. If we want a bold jobs plan, there’s no better way forward than by creating the good caregiving jobs that workers and their families desperately need.