Study: Good Economic Conditions Can Lead to Poor Nursing Home Care


Nursing home quality, a new study says, is often tied to economic conditions. Nursing home quality of care, says the study linked below, is inversely linked to the economy—meaning that as the economy gets better for most Americans, nursing home quality of care gets worse. By studying the nursing home quality of care from 2001 through 2015, mostly the run of the Great Recession, researchers have shown that higher unemployment leads to better care in nursing homes.

Wait, What?

Good economic conditions, like near-full employment, mean that nursing homes often lack full staff and experience higher turnover. This is because, as many professional caregivers know, caring for seniors is an emotionally and physically taxing job. (Many health care workers, just like non-professional caregivers, are overworked and under-compensated for the vital work they do.) Economists call this inverse relationship between quality and unemployment “countercyclical.” It implies that this cycle runs counter to, or the opposite, other important factors that they consider.

As the economy worsens, fewer jobs are available, or people are forced to find multiple jobs as wages fall. There aren’t as many opportunities to move “up” economically by finding higher-paying or less-demanding jobs. This means that jobs that pay less or are less appealing, are slower to fill if other options are available. Employees are more likely to stay in their positions longer because they have to to make ends meet.

An Example

Let’s walk through an example. Sandra, a woman in her thirties with three children, gets laid off of her higher-paying home nursing position with a company due to a recession. Despite having some savings, she needs to find a job and quickly, especially when her spouse’s job has rumors of layoffs, too. Because she has worked for so long as a caregiver, she seeks out positions at a local nursing home caring for seniors.

The wages at Sandra’s new job are significantly lower than in her previous position, but wages everywhere are falling. She takes the position, bringing her previous experience with her. Until the economy improves, which will take years, she must stay in this position. Luckily for her, the nursing home is fully staffed since many of her former colleagues went looking for work in the same area and field. This means that her wages are lower, but her workload is about the same, for now, so she will stay until better opportunities open up. When the economy improves, she finds a better-paying job with a company similar to her original employer. In search of better wages, she may move jobs multiple times over the next ten years or so as wages rise and companies offer more positions.


Perhaps the most important takeaway from this study is this: If you or a loved one are looking for a nursing home soon, you should ask better questions to determine the quality of care received by current residents. (This is in addition to, not instead of, other important questions related to the quality of care!) The study listed notable exceptions and other factors which can improve quality of care, both of which are related to economic conditions. However, these factors can also exist no matter the economic conditions if nursing homes are properly run, funded, and staffed.

Exceptions and Other Factors

The study focused only on privately-owned, freestanding nursing homes in the US, so seniors in publicly-owned nursing homes or in nursing homes in other countries might find different results. Those who conducted the study also noted that quality of care can be improved no matter economic conditions by reducing staff turnover and increasing staffing.

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Questions to Ask in Visits

If you or a loved one are looking at nursing homes, or if you work for a nursing home, you will likely find better care at a fully staffed nursing home, one that maintains the same staff for more extended periods, and has supportive working conditions for the entire team. This can include proper training, compensation, and management as well as accessible transportation and clean facilities. When searching for a nursing home for you or a loved one, ask questions about employee retention and unfilled jobs—they can be an indicator that the nursing home treats staff well and that staff members aren’t overworked. Below are some ways you might phrase these questions as you conduct research into possible nursing homes:

  • How long does the average care worker stay employed at this facility?
  • Do you have competitive wages and benefits for your employees, so they’re incentivized to stay?
  • How much training do you offer to your workers? For your management staff?
  • Do you have many staff positions open right now?
  • When you meet a worker in the nursing home, ask in a friendly way
    • How long have you been here? or
    • I have a friend looking for a job in senior care. How is it working here? or
    • Do jobs open up frequently?”

Answers to the above can begin to give you a picture of how economic conditions might affect the nursing home care for yourself or a loved one.

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Sean Shenghsiu Huang, John R Bowblis, Is the Quality of Nursing Homes Countercyclical? Evidence From 2001 Through 2015, The Gerontologist, gny148,