More than 53 million Americans, or about one out of every five adults, currently provide uncompensated care to their spouses, partners, parents or children living with serious health problems or disabilities.

As about 60% of these caregivers are employed outside the home, the TIAA Institute argued in its recent report that caregiving is an important workplace issue that most employers underestimate.

According to the study, more than 90% of caregivers are also financial caregivers—defined as either contributing direct financial support or coordinating some or all of their loved one’s money-related matters. As a result, many caregivers leave the labor force or retire earlier to devote sufficient time to caregiving duties.

Specifically, family caregivers have an average of about $7,200 per year in out-of-pocket expenses and spend even more for family members with serious conditions like Alzheimer’s disease.

Caregivers are also more likely to have lower levels of financial assets and more likely to have problem with debt than non-caregivers. Additionally, 25% of caregivers report having less than $1,000 in savings and investments, compared with 15% of non-caregivers.

Misaligned Benefits

The impact on employers is also substantial. A recent study conducted by researchers for the Value in Health Journal estimated that productivity losses amount to $5,600 per employee per year.

“Nevertheless, most employers do not measure the extent of caregiving responsibilities in their work force, and greatly underestimate the direct and indirect business costs of their employees’ caregiving,” the TIAA report stated. “Studies of employers and employees suggest that the benefits employers provide are not well aligned with what caregivers say they want and need.”

For example, while 51% of employers surveyed in the TIAA report offer flexible scheduling, 76% of employed caregivers said they would use a flexible scheduling benefit if it was offered to them. In addition, 74% said they would take advantage of paid family medical leave if offered, and 66% would take advantage of remote work or telework.

TIAA also pointed out that family caregiving is not only a concern for middle-aged and older adults. Millennials—now in their 20s and 30s—make up one-quarter of all caregivers.

Because life expectancy in the U.S. has increased by 17 years since 1935, this “longevity bonus” has implications for retirement readiness, as anyone’s time as a caregiver might be much longer than in the past, highlighting the need to plan for longer lengths of retirement and caregiving through different life stages.

How Employers Can Help

Given the significant impact of caregiving on employee performance retention, employers have an opportunity to lead efforts to support working caregivers and alleviate their financial stress.

TIAA recommended that employers evaluate the prevalence and extent of caregiving among their employees. One instrument to potentially use is the Caregiving Intensity Index, developed by the startup Archangels. The index is a two-minute self-assessment that measures how caregiving is affecting someone’s well-being and how they are coping with stressors such as money and family disagreements.

This application has been implemented in workplaces in New York and Massachusetts through “Any Care Counts” campaigns, according to TIAA.

Surya Kolluri, head of the TIAA Institute, said in an emailed response that the number of caregivers in a given organization is “always going to be in flux.”

“Each day, about 10,000 Baby Boomers turn 65, and they’re living longer than ever.” Kolluri said. “So just because an employee isn’t a caregiver today doesn’t mean they won’t be tomorrow.”

He added that seeing how many people use caregiving benefits and attend resource group meetings can help employers have a better understanding of their workforce, and he argued for providing these resources to build employee loyalty.

Employers ought to also review their current benefits offerings and how well they address challenges to caregivers’ financial well-being, TIAA argued. Based on this assessment, employers can consider additional benefits that match caregivers’ needs, such as flextime, paid family leave, geriatric management services and emergency backup care.

In terms of retirement planning, employers should provide “early and continual access” to retirement planning services that incorporate awareness of the impact of longevity for individual employees and the effects of financial caregiving at different life stages. Providing access to financial apps or access to financial or legal advisers can also be beneficial.

“Employers need to offer services that help people understand how to craft short- and long-term budgets,” Kolluri said. “Provide access to financial advisers or other resources that help employees see, for example, how they can afford to buy a home, start a family and send kids to college while also saving for retirement and planning for the possibility of time off and extra expenses related to caregiving.”