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The New Face of Our Economy

Even if we put aside the moral argument for supporting direct care workers, it's in our national interest to better compensate and support these hardworking people who do so much to help the rest of us. The challenges confronting this workforce send shock waves throughout our economy.
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Fifty years into the war on poverty, it's time to focus on one of our fastest-growing workforces.

Fifty years ago this month, President Lyndon Johnson declared war on poverty. At the time, the U.S. poverty rate was around 19 percent, and the president believed the government had a role to play in reducing that rate.

The war on poverty continued beyond Johnson's tenure under both Democratic and Republican administrations, improving the lives of millions of American families by creating, expanding or strengthening crucial education, job training, health care, nutrition assistance and income support programs to construct our social safety net. But there is much still to do to stop rising inequality and reduce poverty -- and there's no better place to start than with direct care workers.

Our nation's poverty rate is now 15 percent. That's lower than it was in LBJ's time, but it's still too high. In this unstable economy, our safety net is working overtime to help struggling individuals and families. Direct care workers like Elizabeth Castillo, a home care aide in El Paso, Texas, who makes less than $25,000 a year despite working two jobs, are falling further and further behind in this extended recession.

Direct care workers -- the nursing assistants, home care and home health aides, personal care assistants, direct support professionals and others who provide the bulk of the paid, hands-on personal assistance and long-term care to older adults and people with disabilities -- are the face of our new service economy and one of our country's largest and fastest-growing occupations. Two subsets of that group, personal and home care workers, are the fastest-growing job categories in the nation.

Even if we put aside the moral argument for supporting these hardworking people who do so much to help the rest of us, it's in our national interest to better compensate and support direct care workers. The challenges confronting this workforce send shock waves throughout our economy, as workers with low incomes spend less and often require taxpayer-funded assistance.

In other words, we can no longer afford to ignore the struggles of direct care workers.

Poor Wages, Benefits and Opportunities for Advancement

Despite the essential care, services and support they provide to us, our families and our friends, direct care workers are cresting the trend of low-paying service jobs with poor benefits.

For a start, they are among the most poorly compensated of all U.S. workers. Their median hourly wage was $10.63 in 2012, which was less than they earned 10 years earlier, after adjusting for inflation. It's no surprise, then, that almost half live in households that receive public benefits like Medicaid and food stamps, many of which stem from LBJ's war on poverty.

These workers are also underserved by, or left out of, many other important programs and benefits. Many direct care workers, for instance, do not get paid sick leave. Many are not entitled to the unpaid leave mandated by the Family Medical Leave Act, and those who are generally cannot afford to take leave without pay. And until next January, when a long-awaited rule will finally go into effect, home care workers are not even guaranteed federal minimum wage or overtime pay.

Then there's health care. Direct care workers have higher-than-average rates of diabetes, asthma and other chronic conditions that become more serious when untreated. They also have one of the nation's highest rates of on-the-job injuries. And yet, they have much lower-than-average rates of health coverage. In 2011, less than half of all direct care workers had health coverage through an employer, and 30 percent of direct care workers had no health insurance at all, often because they could not afford the premiums and copays.

Going without these benefits is obviously hard on direct care workers and their families -- and a bitter irony for workers who do so much to improve other people's health. It also has a strong ripple effect. Without paid sick leave, direct care workers often face a tough choice: Either stay home, thus losing wages that may make them unable to pay the bills, or go to work sick or injured, perhaps exposing consumers to the risk of infection or injury. Those with no insurance may wait until a health problem gets so bad that they must take a long absence from work, or get the kind of expensive intervention that can lead to serious debt or even bankruptcy, contributing to the ill health of the economy as a whole.

Finally, there's the issue of advancement. Direct care workers do not receive enough recognition or compensation for their expertise and experience, and they have few ways to advance without leaving the profession. This lack of opportunity and respect is a main contributor -- along with poor wages and benefits -- to the high turnover rates that plague the industry. And high turnover among direct care workers is a problem for those who rely on them, costing consumers, families and other employers time and money as they hire and train new workers, and disrupting the continuity and reliability that is such an important part of quality care and support.

What We Can -- and Must -- Do

The best way to dramatically cut poverty rates is to ensure that the economy works for everyone -- starting with our fastest-growing workforces. That includes investing in quality jobs and strong programs that support families when they're struggling.

Here are some current or proposed policy changes that would improve financial security and stability for direct care workers:

  • Advocacy is needed to ensure that Congress does not derail the final home care rule that recently extended federal minimum wage and overtime protections to home care workers nationwide. Direct Care Alliance and our allies will also be helping the Department of Labor educate workers, consumers, and other employers about the rule to make sure it is implemented properly.
  • We must urge Congress to pass the Fair Minimum Wage Act of 2013, which will give low-paid workers an urgently needed raise and boost the consumer spending that drives the U.S. economy.
  • We must urge Congress to enact immigration reform that creates a path to citizenship for undocumented direct care workers to reduce vulnerability to wage exploitation and abuse. (An estimated 20 to 24 percent of direct care workers are foreign-born, and many of them are undocumented.)
Affordable health insurance and other benefits:
  • The Affordable Care Act (ACA) takes important steps to make health care affordable and accessible, but we need to ensure that it is implemented properly. After the Supreme Court ruled that states may opt out of expanding their Medicaid programs under the new law, about half of the 50 states chose not to do so, leaving millions of low-income people stranded without an affordable option. Medicaid expansion was also the foundation upon which many of ACA's other initiatives were built. We need to urge states whose leaders are currently on the fence or have decided against expansion to expand their Medicaid programs.
  • The ACA is complicated, so most people need some assistance to understand their health care options under the new law and figure out how to get coverage. That help may come from individual navigators or from initiatives like Direct Care Alliance's Get Direct Care Workers Covered campaign, which is helping direct care workers and other low-income residents of New York state find the coverage that best fits their needs.
  • We must urge Congress to pass the Family and Medical Insurance Leave (FAMILY) Act, which would make paid family and medical leave available to nearly all of America's workers.
  • We must also urge Congress to pass the Healthy Families Act, which will set a national paid sick days standard.
Safety net programs:
  • We must urge Congress to oppose cuts to the Supplemental Nutrition Assistance Program (SNAP, also known as food stamps), which offers nutrition assistance to more than 47 million low-income individuals, including many direct care workers and their families.
Career advancement within the profession:
  • We must create career ladders for direct care workers so that they can advance and earn more without leaving the profession. Direct Care Alliance's Personal Care and Support Credential, a competency-based test for personal assistance workers in home- and community-based settings, gives workers a way to demonstrate their skills. It also provides a way of tying increased pay and responsibility to measurable skills and competencies.

As we work to advance the goals of the war on poverty, improving the economic security of direct care workers and their families should be at the top of the list, because improving direct care workers' wages, benefits and career advancement opportunities will let us accomplish three important goals. We can help ensure a stable, qualified direct care workforce large enough to meet growing demand. We can transform one of our fastest-growing job categories so that it bolsters our middle class and strengthens our economy instead of swelling the ranks of the working poor. And we can deliver on the promise of a nation where hard work is rewarded and respected.

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