Intensive Informal Care and Impairments in Work Productivity and Activity
Informal care reduces work on the intensive and extensive margins; however, we do not know how caregiving affects work productivity. We link two new unique national U.S. data sets to provide the first causal estimates of the effect of providing at least 80 hours of informal care in the past month on work productivity, compared to less intensive caregiving. We control for caregiver selection into work using a Heckman selection model and use instrumental variables to estimate the causal effect of providing at least 80 hours in the past month on work productivity, using the Work Productivity and Activity Impairment (WPAI) instrument, and weekly hours worked. The IV is widowhood status of the care recipient. For both the OLS and IV results, providing at least 80 hours in the past month is associated with a 0.07-0.13 point increase in the WPAI compared to non-intensive caregivers, signifying lower work productivity. This result is mainly driven by presenteeism, or employees being less productive on the job, as opposed to absenteeism, measured by missed days of work. The OLS models are precisely estimated (p <0.001) and IV results are not significantly different from zero at conventional levels. Intensive caregiving is also associated with about 3 fewer hours of weekly work compared to less intensive caregiving in OLS (non-significant with IV) and intensive caregivers are about 7 percentage points less likely to work full-time compared to part-time in OLS (non-significant with IV). Our findings begin to explain mechanisms by which caregivers experience wage penalties. Building data sets with work productivity for caregivers and non-caregivers alike would allow us to estimate the net societal benefits of caregiving and work productivity.