The Impact of “Parent Care” on Female Labor Supply Decisions

Data from the 1986–1988 Survey of Income and Program Participation panels were used to analyze how informal-caregiving of disabled elderly parents affected female labor supply. Instrumental variables analyses suggested that coresidence with a disabled parent leads to a large, significant reduction in work hours, due primarily to withdrawal from the labor force. Although the impact of nonhousehold member caregiving was insignificant, evidence of an effect was stronger when commitment of caregiving time was greater. Projections of female labor force participation rates should account for potential increases in caregiving demand due to the aging of the U.S. population.