Living Wage

Living Wage

McKnight’s had an interesting article about providing a living wage to nursing home caregivers. LeadingAge released findings from its new analysis about a living wage. The group examined the effect if nursing home operators paid direct caregivers a living wage. A living wage is defined as a wage that allows caregivers to pay for basic living expenses without relying on public assistance.

This report actually shifts from the cost side and [asks] isn’t there upside … isn’t there a potential win-win here in that we get a better experience for the staff and a better experience for the patients?” David Grabowski, Harvard healthcare policy, said during the discussion. “We’re going to get less staff shortages, less turnover, an improved quality of care and quality of life for long-term care recipients and we’re going to get improved economic growth and productivity. That’s a lot of benefits there.”


The study found that the benefits from the higher pay would reduce turnover costs, increase worker productivity and reduce financial insecurity for staff members. Safer staffing and less turnover costs are a direct benefit to employers and residents. Less abuse and neglect as well. Increased pay would attract better people to the profession. Additionally, it found that adopting a living wage would in turn increase hours for workers.


“By reducing turnover that also means retaining people longer. They’re gaining more experience, they’re becoming better at the care that they provide,” one researcher said.  “The other part is by paying people more you are reducing their financial insecurity, bringing them out of poverty. That reduction in financial insecurity reduces stress, allows people to focus more on their jobs and that also boosts productivity,” he added.

Stephen Campbell is a data and policy analyst at the New York-based research firm PHI. He emphasized the importance of policymakers understanding how living wages can actually save money.

Even without considering the cost savings, the costs of raising wages alone is sort of a drop in the bucket in the context of the total costs of delivering long-term care,” Campbell said. “For policymakers in particular, I think it’s really time to reject this strict posterity mindset when it comes to publicly funded long-term care so that we can do what’s right on behalf of these workers and consumers.”