Unpaid Family Caregiving Tops $1 Trillion

Lead paragraph

The scope and scale of unpaid family caregiving in the United States reached a watershed in 2026, with 59 million Americans now identified as caregivers and the economic value of that work estimated at more than $1 trillion per year (MarketWatch, Mar 26, 2026). This surge in informal care provisioning is not merely a social statistic: it reframes labor markets, corporate benefits liabilities, public budgets and segments of the financial sector that underwrite long-term care. The headline numbers mask heterogeneity — caregivers range from sandwich-generation parents mid-career to retirees subsidizing skilled nursing stays — but the macro effect is consistent: a privately borne subsidy of the formal care economy on which public payors and employers implicitly rely. Institutional investors assessing healthcare services, insurance, real estate and workforce-exposed sectors must factor these dynamics into demand forecasts and cash-flow scenarios. This report synthesizes the data, benchmarks it to demographic projections and examines implications for payors, employers and capital allocators.

Context

The MarketWatch report dated March 26, 2026, cites 59 million Americans providing unpaid care to adults and places the annual value of that activity above $1 trillion. That figure should be read against demographic tailwinds: the U.S. Census Bureau projects that by 2030 all baby boomers will be aged 65 or older (U.S. Census Bureau, 2019), materially increasing the population cohort statistically most likely to require assistance with activities of daily living. AARP’s Caregiving in the U.S. report (2020) remains a critical behavioral reference point: it estimated a median caregiver age of roughly 49 and an average weekly commitment in the order of two dozen hours, underscoring that many caregivers are simultaneously in the labor force.

Unpaid caregivers therefore create a multi-faceted economic effect: substitution of paid home- and community-based services, reduced labor-force participation or part-time shifts among caregivers, and deferred public spending which may surface as higher acute or institutional costs later. The $1 trillion estimate implies unpaid care is a material slice of national health-related economic activity; by comparison, broad measures of U.S. personal health consumption expenditures reached approximately $4.5 trillion in recent years (CMS National Health Expenditures), indicating that informal care is a non-trivial complement to formal health spending. For investors, the key question is how much of this subsidy persists and how quickly formal demand — paid home-care, assisted living, medical home models — will capture dollars previously provided informally.

The distribution of caregivers across states, income bands and age cohorts also matters. MarketWatch highlights the national total but state-level Medicaid programs and labor markets will feel the effects unevenly: states with older populations and weaker home-care workforces will see sharper public-cost pressures and faster growth in demand for paid services. That heterogeneity influences both public policy choices — for example, Medicaid waiver design and wage floors for home health aides — and private investment returns in regional operators of home care and assisted living.

Data Deep Dive

Three discrete data points anchor this section: 59 million caregivers (MarketWatch, Mar 26, 2026), an aggregate unpaid value above $1 trillion annually (MarketWatch, Mar 26, 2026), and the demographic pressure noted by the U.S. Census Bureau that all baby boomers will be 65+ by 2030 (U.S. Census Bureau, 2019). AARP’s 2020 Caregiving in the U.S. report adds micro-level texture, indicating median caregiver age near 49 and average weekly hours of care in the mid-20s (AARP, 2020). Together these data illustrate both scale and intensity: millions of households are committing time that, if priced and purchased in the formal market, would amount to a substantial reallocation of GDP to care services.

Time-use metrics are central to monetizing unpaid caregiving. If 59 million caregivers each average 20–25 hours per week, the implied labor input is hundreds of millions of weekly hours — comparable to the full-time equivalent of multiple million workers. That conversion yields the $1 trillion-plus figure when multiplied by conservative wage assumptions for home health aides and lost earnings. The methodology matters for precision; the MarketWatch number aggregates multiple modelling choices but is directionally consistent with prior academic and advocacy estimates that have shown unpaid caregiving valued in the hundreds of billions to over a trillion dollars in recent years.

Comparative benchmarking sharpens interpretation. Unpaid caregiving measured against formal home health and personal care markets indicates substitution potential: the Bureau of Labor Statistics reports robust employment growth among personal care aides and home health aides over the past decade, yet wage growth has lagged occupational demands. When unpaid care is factored in, the true scale of demand for personal-care services is materially larger than current payroll data imply. Investors evaluating service providers should therefore model two scenarios: one where informal care remains predominant and one where formalization accelerates, driving paid market expansion.

Sector Implications

The private-sector implications span employers, payors and service providers. For employers, the prevalence of caregiving translates into absenteeism, reduced productivity and increased turnover risk, particularly among mid-career employees who constitute a sizeable portion of caregivers. Corporate benefits costs may rise as employers expand paid leave or subsidized home- and telecare to retain talent; these are real cash costs distinct from the externalized social cost represented by unpaid care. Investor diligence on human-capital-intensive sectors — health systems, retail, hospitality — should therefore account for potential wage pressure and augmented benefits spend tied to caregiving prevalence.

For payors, including Medicaid and private insurers, unpaid caregiving functions as an implicit cost-offset to formal benefits. As caregivers age and potentially require care themselves, the fiscal liability shifts back to public programs. States with larger shares of elderly residents or weaker home-care workforces will likely face faster growth in paid long-term services and supports (LTSS) spending. That dynamic has implications for municipal and state bond trajectories and for the actuarial assumptions underlying long-term care insurers.

Service providers and technology vendors stand at an inflection. If a portion of the $1 trillion in unpaid care is monetized, sizable revenue pools open for home health agencies, staffing platforms and care-coordination technology. However, supply-side constraints — an aging workforce in care occupations, low wages, and high turnover — could cap near-term formalization. Strategic investors should therefore evaluate operators with scale, ability to lift wages and deploy technology that increases labor productivity. For thematic readers, see our broader coverage on care delivery models and workforce readjustment topic.

Risk Assessment

Several downside risks complicate a simple monetization thesis. First, caregiver preferences and cultural norms support continued informal care in many communities; not all unpaid care will convert to paid services even if families have the means. Cultural persistence creates a ceiling on demand that differs regionally and by demographic group. Second, policy responses are uncertain: while some states are expanding Medicaid home- and community-based services, federal reforms are politically challenging and slow, meaning sizable public subsidies to formal care are not guaranteed.

Operational and wage risks also constrain private returns. If formalization accelerates without commensurate improvements in training and retention, quality and regulatory compliance issues will increase, pressuring margins. Conversely, significant wage increases to attract a larger paid workforce would increase expenses for operators and insurers, compressing free cash flow unless offset by higher prices or subsidies.

Finally, macroeconomic shocks — a recession that depresses household income or a fiscal squeeze on state budgets — could force delayed care or reduced benefits, increasing acute-care utilization and shifting costs to hospitals and Medicaid. Investors should stress-test exposure to cyclical demand changes and policy shocks when modeling long-term care strategies. For operator diligence, cross-refer to our long-term care capital allocation framework topic.

Outlook

Over the next five to ten years the most likely trajectory is gradual partial formalization: a portion of the $1 trillion in unpaid care will be monetized as wages and workforce capacity permit, but a substantial share will remain informal due to preference and cost constraints. Demographics — notably the 2030 baby-boomer threshold — will underpin structural growth in total care demand even if the share purchased through formal channels increases only incrementally. Market winners will be those that can integrate workforce strategies, technology-enabled care coordination and diversified payor mixes to capture both private-pay and public-reimbursed segments.

Capital markets should anticipate divergence across sub-sectors. Scalable technology and staffing platforms with unit economics that can improve caregiver productivity are likely to attract premium valuations; brick-and-mortar institutional providers without clear pathways to higher-margin ancillary services may face compression. Public payors and municipal budgets will continue to be a wild card: targeted federal or state interventions could rapidly shift economics for private operators, either through expanded reimbursements or by imposing labor standards that alter cost structures.

Fazen Capital recommends scenario-based underwriting that models caregiver behavior, wage inflation, and policy reform as separate axes. Stress-testing portfolios for a 10–30% reallocation of unpaid care to paid services over a decade will help reveal exposed assets and opportunity sets. Our research indicates that investors who price labor and policy risk explicitly will outperform peers who extrapolate historical demand trends without accounting for the scale of informal care currently embedded in the system.

Fazen Capital Perspective

A contrarian but plausible insight is that the persistence of unpaid caregiving represents both a constraint and a latent demand reservoir: while conventional wisdom treats unpaid care as a drag on the paid-care market, we view it as an embedded option. If policy reforms or productivity-enhancing technologies lower the friction of converting informal care to paid services, the velocity of that conversion could be faster than consensus models that assume linear growth. For example, subsidy coupling (wage supplements tied to caregiver certification), remote-monitoring technologies that reduce supervisory burdens, and employer-sponsored caregiving benefits could together catalyze a step-change in willingness to pay.

This implies investors should look not only at current revenue streams but also at instruments and business models that can capture option value — workforce training joint ventures, certification-as-a-service, and hybrid private-public contracting models. These vehicles can benefit early from marginal movements in caregiver willingness to outsource tasks without requiring full-scale formalization. We therefore favor flexible capital structures and partnerships that can scale quickly in a rapidly shifting regulatory and cultural environment.

Bottom Line

Unpaid family caregiving now exceeds $1 trillion annually and involves 59 million Americans, producing a structurally material effect across labor markets, payors and care providers (MarketWatch, Mar 26, 2026). Investors should explicitly model the conversion dynamics between informal and formal care, wage and workforce constraints, and state-level policy variability when pricing exposure to the long-term care ecosystem.

Disclaimer: This article is for informational purposes only and does not constitute investment advice.