Why economists should care about unpaid chores

Feminist economists have long advocated for changing the way we measure a country’s wealth. Today, as we attempt to remedy the societal inequalities exacerbated by the pandemic, their argument is gaining traction.

Since 1944, the gold standard for measuring national economies has been the Gross Domestic Product (GDP), a metric that quantifies the monetary value of a country’s goods and services. But while we tend to view GDP as the chief indicator of a country’s success, it tells us little about the quality of life it generates.

In a quest for a more accurate economic portrait, many feminists are calling for a crucial addition to the equation: incorporating unpaid tasks predominantly shouldered by women — cooking, cleaning, childcare — into GDP calculations. To understand how folding laundry factors into the national economy, Welcome To The Jungle spoke with Nancy Folbre, professor Emerita of Economics at the University of Massachusetts Amherst. An expert in political economy and unpaid care work, she gives a brief overview of how household production intertwines with the larger economic landscape, and the current challenges in measuring living standards.

Can you tell me a bit about your professional background and what led to your interest in the economics of gender and care?

A slippery slope. As a graduate student in economics at the University of Texas, I got interested in demography – in particular, women’s fertility decisions.

This was not long after I escorted a very desperate fellow student who was pregnant to Mexico to get an abortion, and got my first prescription for birth control pills. These events got me thinking about the cost of children to mothers. That, in turn, got me thinking about the cost of caring for other dependents, and the cost of unpaid care in general.

It surprised me that these activities, while obviously costly, were valued as moral commitments but not as productive contributions.

It wasn’t so much the absolute costs that interested me as the distribution of the costs and economic benefits — between women and men, and between parents (or other caregivers) and society as a whole.

Can you tell me a bit about how GDP came to be and how it serves us today?

People have always been interested in ways of assessing the national economy as a whole. In the run-up to World War II in the US, there was intensified concern over how to finance a war effort. Economists came up with a set of consistent rules for national income accounts. From the very beginning, they warned that it was only a measure of that part of economic activity that involved markets — the value of things bought and sold.

In her paper “The Girly Economics of Care Work,” Misty Heggeness points out that economists like Phyllis Deane were advocating for adding household production to GDP as early as the 1950s, when GDP measurements were being standardized internationally. How come the UN ended up narrowing it down to only economic activity that involved markets?

The UN did not “narrow it down” — it just didn’t pay much attention to critics like Phyllis Deane.

If GDP was originally meant to just be a set of consistent rules for national income accounts, how did it turn into the measure of a country’s “success”?

Economists bear much of the responsibility for this — macroeconomic theory is largely focused around the growth of GDP.

So why do some economists argue unpaid household labor should be included in GDP calculations if not something that’s bought and sold?

The simplest answer is that unpaid work provides indispensable goods and services. If it wasn’t “volunteered” we could have to spend money to purchase substitutes for it.

How could adding household production to GDP calculations benefit society?

If done accurately and consistently, it would provide us with a more complete picture of how much total work is getting done and how it is affecting our living standards.

Our living standards are usually equated with our family income. Assigning an economic value to unpaid work clarifies its contribution relative to earned income.

Is there a way of measuring unpaid work?

Every year the Bureau of Labor Statistics conducts the American Time Use Survey, which asks a nationally representative sample of people 15 and over how they used their time on the preceding day. In this context, “work” is defined as anything you could, in principle, have paid someone else to do for you.

The results consistently show that the US population devotes about as much time to unpaid work as to paid work; women, and particularly mothers, perform significantly more unpaid work than men.

What are the obstacles to adding household production to GDP calculations?

The obstacles are mostly political and cultural. Reliance on GDP as a measure of “success” is an ingrained habit, especially in the business community.

The data we need to provide a lower-bound estimate of the value of unpaid work is readily available, and is already used in a “satellite account” that supplements GDP. While I have some criticisms of this account, it is a good start.

What are your criticisms of this account?

First, it doesn’t include all unpaid work, ignoring supervisory care of children, even though measures of this constraint on parental time (and opportunity to earn income) are available in the American Time Use Survey.

Second, It applies a very low wage rate to unpaid work — basically the wage of a domestic servant.

How would you integrate these unpaid work measurements into GDP calculations?

This has already been done in the satellite account: You take the average number of hours of unpaid work, multiply it times an hourly wage that represents its replacement cost, then multiply it by the number of people doing the work. That gives you the total imputed value of unpaid work.

Are there any international implications of adding household production to GDP? Could it change the way we view the wealth and power of countries?

If it made poor countries look “richer” it could have this effect. But the share of total work that is unpaid does differ that much across countries.

It does change some rankings of countries based on living standards — for instance, a classic paper by Schettkatt showed that it makes Germany look better off than the US.

It seems strange that the GDP is strong while so many Americans are suffering from burnout. How can we claim to be economically successful when reports indicate the human capital isn’t doing so well?

In addition to unpaid care work, professional overwork seems to be a contributing factor to burnout that flies under the GDP radar. Many workers complain they’re doing the job of two people, especially in positions that aren’t paid hourly, like a monthly salary. Strangely enough, employees in these jobs often end up with better wages when they work more hours. So “even though the two workers are identical, one worker will make more per hour just because the individual is willing to work more hours or work a particular schedule,” as recent Nobel Laureate Claudia Goldin put it. And, often, women work fewer hours than men — precisely because of their care responsibilities. So if it makes sense to calculate how much unpaid care work would cost if it weren’t “volunteered,” does it also make sense to calculate how much these overtime hours would cost if they were divided among more workers; the potential jobs that could be created? Perhaps this is outside of the scope of GDP, but it seems very pertinent when assessing the distribution of a country’s costs and economic benefits.

I am sympathetic to your concerns here and agree that burnout and overwork are serious problems. But this doesn’t really connect to Goldin or to national income accounts. Goldin believes that men like these jobs because they pay more, and employers are willing to pay more because their employees are more productive when they work longer hours, because customers are willing to pay for services that are readily available whenever needed and value continuity. She also seems to believe that women would love to earn higher pay this way if they just didn’t have so many family responsibilities.

Be careful the way you use the term “overtime” — relatively few workers today are covered by overtime legislation that requires they be paid extra, and there is a lot of variation in the hours that “full-time” workers work.

Some overwork among professionals is about work intensity and on-the-job frustration, not just longer hours. But there is now a lot of competition for well-paying professional jobs — and this definitely puts pressure on people to work longer hours. Very true of academic life, for instance.

Also true of doctors and nurses.

I think the issue of “overwork” and job quality in general needs to be addressed occupation by occupation. What’s really screwy is that some people can’t get ENOUGH jobs — like in retail jobs, where people often get short shifts — while others have to work TOO MANY hours.

You know, the French tried to limit the work week to 35 hours partly for the reason you suggest — that it would create more jobs — but they got a lot of pushback and the rule proved very difficult to enforce.

What would you, personally, use as a measurement of a country’s “success”?

I don’t think there is a single measure — most critics of GDP (including me) call for a dashboard of indicators that would include measures of physical and mental health, levels of social cost related to crime, incarceration, drug abuse, domestic violence, and environmental sustainability. There are many indicators out there already compiled, such as the Genuine Progress Indicator (GPI) that don’t get much attention.

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