The Value of Unpaid Work

One of the most interesting (at least in our opinion) topics in economics is the question of how to value work that individuals do outside the workplace. It is relatively easy to compare and contrast salaries between two office workers, or baseball players, or firefighters. There are simply two numbers. Of course it may be true that there are discrepencies in hours worked for a similar salary, overtime pay and bonuses between otherwise comparable workers.

However, these variables are all able to be worked out with a little homework. In comparison it is less easy to figure out what work done outside the workplace is worth however. For example, what is the value of cooking and cleaning? How about laundry? Child care? Do you value these services by their market cost? By salary foregone? Aside from obvious gender equality implications, there are numerous family planning and social equality scenarios where more clarity regarding this difficult economic topic could prove helpful.

The OECD recently released 'Society at a Glance 2011' with information on this very topic. Amid this annual report covering 'a wide range of information on social issues – such as demography and family characteristics, employment and unemployment, poverty and inequality, social and health care expenditure, and trust and tolerance,' the organization included a special chapter on unpaid work. Freakonomics has a posting on the report which extrapolated some facts of interest for readers. As they borrowed heavily from the report itself, we hope Messrs. Levitt and Dubner don't mind us doing likewise:


- The value of unpaid work is very considerable: about one-third of GDP in OECD countries, ranging from a low of 19% in Korea to a high of 53% in Portugal.
- Most unpaid work is cooking and cleaning: on average, it’s 2 hours 8 minutes work per day across the OECD, followed by care for household members at 26 minutes per day.
- Americans spend the least daily time cooking per day (30 minutes) and Turks the most (74 minutes). At less than 80 minutes per day, the U.S. also has the third lowest time spent eating in the OECD. Interestingly, American obesity rates are the highest in the OECD: one third of our population is obese.

They also helpfully posted one of the many interesting graphics from the report:

While the OECD doesn't provide all of the answers, for example the value of the work itself still needs some analysis, the report nonetheless adds additional and valuable data points to this fascinating and ongoing conversation.