‘The current system right now is unsustainable’: top economist sees a crucial crack in the economy

Home healthcare workers make up less than 3% of the total jobs, but KPMG senior economist Matthew Nestler sees reason to pay attention—and reason to be concerned.

“The current system right now is unsustainable,” he told Fortune, “and [it’s] buckling before we’re hit with this massive aging and retiring of the baby boomers—the largest generation ever to age and retire.” 

Despite making up just a fraction of the workforce, home healthcare workers have a disproportionate impact on the rest of the economy, Nestler argued, saying that if people are unable to get the health care that they need, that will result in an increase in unpaid elder care, causing domino effects all through the labor market. The person pushed into unpaid elder care, he reasoned, “is employed in another part of the economy, then passes up career opportunities; they reduce work hours; they leave the labor force.”

Call it the home healthcare canary in the coal mine. 

Healthcare, including home healthcare and elder care, has boomed despite a cooling labor market. The sector alone added 693,000 jobs in 2025, despite the U.S. economy seeing a total increase of 116,000 jobs. That means without healthcare, the economy would have lost about 577,000 jobs. The resilience of the sector is in large part to baby boomers, the oldest of which are 80 and the youngest of which are nearing retirement age. The generation represents nearly 73 million people in the U.S. and now require more care as they age. Personal healthcare spending for older adults topped $1.2 trillion in 2020, about $22,000 per person, according to Centers for Medicare & Medicaid Services data. 

Fewer hours, more problems

Citing Bureau of Labor Statistics data, Nestler wrote in a LinkedIn post this week that while home healthcare services added 7,000 jobs in March, it is still well before 2024’s average of 12,900 added jobs per month, far less than gains needed to keep up with high demand. Moreover, weekly hours for healthcare services employees have dropped from a peak for about 30 in March 2023 to 28 today—its lowest point in nearly two decades. That drop is steepest for production and nonsupervisory employees in the sector.

KPMG found 10% to 20% of workers in every single industry provide unpaid elder care. Many of these individuals are Gen X and millennials, individuals who hold leadership and management positions in their jobs. While companies are recognizing the importance of unpaid care, providing some benefits, the weight of unpaid care will increase unless the labor supply is replenished, Nestler said. 

He noted that falling hours and meager payroll additions for home healthcare workers is a sign that external pressures are straining a critical sector.

“Demand for home healthcare services continues to rise as the population ages and more seniors prefer to age in place at home,” he wrote on LinkedIn. “Yet hours are declining while payrolls grow modestly and prices rise.”

Burnout and immigration woes

Relying on public funding with low rates of reimbursement rates with a historically high supply of labor, home healthcare jobs typically have low wages, less than $35,000 annually. 

These low wages have resulted in underemployment, forcing home aides and elder care workers to sometimes seek out one or two other jobs. Others leave the sector all together as a result of abysmal pay combined with being emotionally or physically taxed from the work, Nestler said.

While a post-pandemic surge of immigrants more willing to work low-wage jobs helped expand the workforce, Nestler warned that the Trump administration’s immigration crackdown has conversely led to that growth slowing. A survey of 691 healthcare workers across 30 states conducted by the Physicians for Human Rights and Migrant Clinicians Network found 26% of clinicians said immigration enforcement has directly impacted patient care, particularly preventative care, chronic pain, and mental health treatment.

“These are really difficult jobs,” Nestler said. “They’re emotionally difficult; they can also be physically difficult in some ways. It reflects our society’s values that some of the most necessary jobs—taking care of the oldest among us—are the lowest paid.”

This story was originally featured on Fortune.com