In the realm of long-term care, a storm is brewing, not in the form of rain or thunder, but in the challenges that retirees are poised to face. Meet Samir Shah, a forecaster unlike those on your local weather report. He specializes in predicting the future of the U.S. long-term care industry. According to Mr. Shah, there’s trouble ahead for Americans who will require assistance with their basic living needs.
“Demand is rising at the same point that supply is decreasing, and both are happening at a very rapid pace,”
said Mr. Shah, who serves as the chief executive of CareScout – an organization that conducts an annual study on long-term care costs.
Picture this: By 2026, the first wave of baby boomers will hit 80 years old – an age where the necessity for care significantly increases. The U.S. Census Bureau paints a worrisome picture by projecting nearly double (11.8 million people) and triple (19 million people) increases in individuals aged 85 and older by 2035 and 2060 respectively.
Moreover, while demand escalates due to an aging population seeking care services, there’s a dwindling supply side exacerbated by labor shortages within the industry caused partly by unattractive wages offered to workers. In 2023, direct care workers earned a median hourly wage of $16.72 – notably lower than wages for jobs requiring similar entry-level qualifications.
“Immigrants make up 28 percent of the long-term care work force,”
reveals recent data from KFF – highlighting how crucial immigrant labor has become in filling essential roles within this sector.
Consider this alarming fact: In 2024 alone, some long-term care services saw price hikes reaching up to ten percent – more than three times higher than general inflation rates that year which stood at only 2.9 percent according to CareScout’s study findings.
The implications are profound; retirees are on track towards facing unprecedented challenges when it comes to securing adequate long-term care solutions amid escalating demands and diminishing resources within an industry grappling with workforce shortages and rising costs.
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