Care&WorkMOD: An Australian Microsimulation Model Projecting the Economic Impacts of Early Retirement in Informal Carers

Abstract

We developed a microsimulation model, Care & WorkMOD, to estimate the economic costs of early exit from the labour force, both for informal carers and the government, from 2015 to 2030. In this paper, we describe the methods used to create the model Care & WorkMOD, and the sources of data and model assumptions. Care & WorkMOD is based on the unit record data of people aged 15-64 years in the three Australian Bureau of Statistics (ABS) Surveys of Disability, Ageing and Carers (SDAC) 2003, 2009 and 2012. Population and the labour force projections from the 2015 Intergenerational Report and the outputs of an Australian microsimulation model APPSIM were used for the static aging of the base data to every five years from 2015 to 2030. The 2015 output dataset of another microsimulation model STINMOD was linked with Care & WorkMOD base data using synthetic matching. The matching process has added data on further economic variables from STINMOD into Care & WorkMOD, which are not available in SDACs. Economic data were indexed based on long-term trends on economic variables to capture the projected economic growth from 2015 to 2030. Care & WorkMOD can provide the long-term estimates of the lost labour productivity due to informal caring responsibilities and the related economic burden both at the individual and national level, and has the potential to "fill the gaps" in the current body of evidence on the costs of chronic diseases, particularly related to informal carers.