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Written on 15 Dec 2020 by Professor Diane Coyle

How much are you worth?

Unpaid yet essential work isn’t recognised in a formal way and disproportionately falls to women. Professor Diane Coyle explores how we might start to measure these hours of effort.

There are certain types of work that have great value, and yet those who do this work remain underpaid or not at all. The coronavirus pandemic has been a reminder of this: of our dependence on low-paid key workers, from hospital cleaners and porters to supermarket cashiers and bus drivers, and of the amount of work needed in every home, with household members locked down nearly 24/7.

The burden of unpaid work – both in the home and through voluntary activities such as helping out in schools or in the local community – has always fallen disproportionately on women. The Office for National Statistics reports that women in the UK work 26 unpaid hours a week on average, compared with 16 hours for men1. Valuing this work at the market wage for similar activities, it adds up to £1.24 trillion a year, or almost two-thirds of GDP, the official measure of paid work2.

To put it another way, if everybody stopped their unpaid work in the home and the voluntary sector, and it was instead paid for by hiring nannies, cooks, cleaners, office managers, drivers, classroom assistants and so on, the UK economy would be more than 60% larger.

Measurement matters

These many hours of effort are clearly valuable – even though no money changes hands – and it has been debated whether an estimate of their value should be included in GDP. Indeed, the debate dates back to the 1940s; the (male) economists involved in developing the way we now measure the economy concluded it would be too hard to collect the necessary data.

There have been advocates for measuring the worth of household and voluntary work. The Bank of England’s Chief Economist, Andy Haldane, for one, is a prominent voice for properly accounting for the essential role voluntary work plays in society. He is also one of the founders of Pro Bono Economics, a charity devoted to assessing the economic impact of volunteering.

Measurement matters because what is not measured is overlooked by policymakers and undervalued by society. For example, women who do not work in paid employment, or only do so part-time, pay a heavy penalty in terms of their lifetime earnings. It’s often called the ‘motherhood penalty’, because it is usually having children that determines when women stop paid employment, and it means they earn around a quarter (in Denmark and Sweden) to more than 40% (in the UK) less than men after giving birth3.

Perhaps regular official statistics on the value of childcare, home care and voluntary work will demonstrate its value in society. In this case, women could proudly feature their unpaid experience on their CVs, and this penalty might decline.

Perhaps, also, men might shoulder more of the unpaid work. And perhaps governments could think about how to reduce the burden of household work and how to enable the essential activities that keep society functioning.

Many European countries, for example, including the Scandinavian nations, provide high-quality, publicly subsidised nursery care, resulting in a high proportion of women being able to undertake paid jobs. This also results in a more equal division of household labour between men and women.

Recognising value

Very few countries regularly collect the data from time use surveys that would be needed to calculate official statistics on the value of unpaid work. But two things are making it more likely that they will start to do so.

One is the way digital technology and tech companies are changing how we carry out business. For example, we do more activities such as online banking for ourselves – bypassing the bank teller that is part of the paid workforce. We provide – and consume – entertainment via social media as an alternative to paid equivalents. These transactions are difficult to define in traditional economic terms, but it is impossible to understand what is happening to the economy as a whole without measuring these activities.

The other is the aftermath of the pandemic. With everyone having spent much more time at home during lockdown, creating more need for cooking, cleaning and childcare, there has been increased visibility around this unpaid work.

As one Financial Times headline asked, rhetorically, “Who is cleaning up the lockdown mess?” The answer is, usually, the women in the household – even those who are still working in their paid job full time. The uneven load is even affecting academic journals, which are being flooded with submissions of papers written during the lockdown – by men.

If governments do start to collect better data about unpaid economic activities, it will not be a moment too soon. The work done for love, or even duty, is vital for the wellbeing of individual households and society as a whole, and it is time we paid proper attention to it.

1 ‘Women shoulder the responsibility of “unpaid work”’, ONS, 2015
2 Household satellite account, UK: 2015 and 2016, ONS
3 ‘Child penalties across countries’, Centre for Economic Policy Research, May 2019

Original source: St Jame's Place

  • About the author

    Professor Diane Coyle, Bennett Professor of Public Policy

    Professor Coyle co-directs the Institute with Professor Kenny. She is heading research under the progress and productivity themes.   Learn more

    Diane Coyle 2018