Labor Economics Workshop: The Daughterhood Penalty: Labor Market Effects of Caring for Aging Parents

Helen Burkhardt, Economics PhD Candidate at Cornell University

The Daughterhood Penalty: Labor Market Effects of Caring for Aging Parents

As the US population continues to age, parental caregiving will become more prevalent, falling primarily on female family members to provide such care. In this paper, I explore how elder parental health shocks impact adult children’s parental caregiving and labor market outcomes by gender. Using parental health information from the Health and Retirement Study (HRS), I develop a novel summary measure of parent health that compiles many possible shocks and demonstrate its application to other datasets, such as the Panel Study of Income Dynamics (PSID). After a shock, daughters provide twice as much parental care as sons. A gender gap in earnings emerges after a substantial shock and is larger after more severe shocks. This earnings effect is driven by adjustments among employed adult children, as employment is only modestly affected by a shock. In particular, employed children do not meaningfully change their occupation, industry, or hours worked after a shock. Further, more generous public spending on caregiving for older adults decreases caregiving among daughters but does not impact sons' caregiving.