The Care Economy is Broken — do we have the will to fix it?

This may be an unpopular opinion but hear me out. We create special days, weeks or months to honor groups of people to compensate for insufficiently valuing them on an ongoing basis. Black History Month (February). Women’s History Month (March). Disability Rights Month (July), LGBTQ Pride (June). We have Appreciation months for teachers, social workers, nurses and caregivers. Interestingly, not for executives, doctors, lawyers, engineers or professors. Perhaps their compensation is sufficient appreciation?

Let’s circle back to caregivers for a moment, shall we? These are the professionals who take responsibility for the literal lives of other humans: humans who are too small, too ill, too incapacitated or too old to care for themselves. And the people who need care are often loved and cherished by someone who can’t provide all the care themselves for a variety of reasons. Those professional caregivers work long hours and must be on alert at every moment to ensure the well-being and safety of their charges. This is unquestionably valuable work — but it is some of the lowest paid work in our economy. For example, childcare providers earn around $27 per hour, or $55,000 per year. In home supportive care givers for older or disabled adults, earn between $17 and $27 per hour.

Why does society pay so little for a service that provides literal life-saving value? A common and uninformed response is that these roles don’t require any specific skill or training. Because that’s exactly who I want to leave my loved one with, right? Hardly.

And in case this isn’t irritating enough, let’s consider the fact that even with low wages, people who are paying for care are spending significant chunks of their income to access it. I’ll tackle the childcare conundrum first.

Over the past decade, childcare costs in Silicon Valley have surged to unprecedented levels. In 2024, full-time infant care at licensed facilities cost $31,200 annually, and the cost for in-home childcare providers averaged $57,000 per child. These escalating costs place an immense financial strain on families, particularly those in lower-income brackets who arguably most need access. For many of them, childcare has become the largest monthly expense — surpassing even housing costs. For many working parents, the skyrocketing cost of care often forces them to choose between their careers and their children’s well-being. And foregoing work now because childcare is too expensive means lost years in career-building and advancement that are nearly impossible to overcome.

Families earning less than $7,472 per month (approximately $89,664 per year) may qualify for childcare vouchers, but even that is not a guarantee of an available space at a convenient location. And, at one dollar over the income cap, there is no financial support available, hence families will confront paying 30% or more of their income for childcare. That’s especially delightful when they may be paying that same amount for rent.

So, we have a system where childcare is unaffordable and inaccessible to many, and at the same time, providers struggle to operate their businesses due to low wages and high costs. Are you loving this as much as I am? Families need childcare to improve their economic stability. Childcare providers are paid too little to improve their own economic stability. And when families forego childcare, they are less housing-stable and have less money to spend in the economy. On the macro-level, when families forego childcare there are fewer available workers for employers to hire, small businesses have fewer customers, and many employment sectors experience high employee turnover, lack of retention, reductions in productivity, and investments wasted on trainings for employees who can’t stay in their roles. Literally nobody is winning in this scenario. And yet, we have been here for decades.

The caregiving economy is similarly grim for older adults. And everyone should pay attention here because — spoiler — we are all aging. The 2024 Silicon Valley Index reported that the number of adults aged 65 and older has grown by nearly 50% in the last decade. By 2030, more than 1 in 5 residents in the region will be over the age of 65, significantly increasing the demand for services to support and care for older adults.

This aging population places additional responsibilities on families, many of whom are simultaneously trying to care for young children while providing care for aging parents. A growing number of multi-generational households in Silicon Valley are now facing the complex challenge of caring for both young children and elderly relatives. This demographic two-fer further complicates the region’s already strained caregiving systems, making it harder for families to balance work (and hence, achieve economic self-sufficiency), childcare, and eldercare.

The cost of long-term care for older adults is also rapidly rising. In 2024, the average cost of in-home care for an elderly person in Silicon Valley was approximately $55,000 annually, and the cost for assisted living facilities averaged $70,000 per year. For families with limited resources, these costs add another layer of financial strain, as they are often already working to meet exorbitant childcare expenses.

The issues of childcare and elder care are deeply interconnected, and both should be viewed as essential public services that benefit the economy as a whole. When young parents have access to quality childcare, they can contribute more effectively to the workforce and the local economy. Similarly, when adult children have access to affordable and supportive services for aging relatives, they can focus more on their careers, alleviating financial strain and enhancing their productivity.

So, what are we going to do? If we are serious about solving these social challenges, we will first need to shift the narrative to expand understanding that caregiving is a public good (not the sole responsibility of the parent or adult child) and has broad-reaching economic benefits to the community at large. Second, we must find ways to increase wages for caregivers to attract and retain quality professionals and create public policies to direct funding to fill gaps between costs of care and reasonable amounts clients can pay for the services. We have the power to fix what is clearly broken — it is simple, but clearly not easy. I’m here for this work.