By Valerie Young
November 10, 2014
In an otherwise routine day, I came across a shocking headline.
In other words, what we do for free to look after our parents, our in-laws, and other older family members would cost a fortune if someone were actually paid for it.
The price tag for informal caregiving of elderly people by friends and relatives in the United States comes to $522 billion a year, according to a new RAND Corporation study.
Replacing that care with unskilled paid care at minimum wage would cost $221 billion, while replacing it with skilled nursing care would cost $642 billion annually.
That could give our economic measures, like GDP, a significant boost if it were included. Just imagine how much higher it would go if the care we provide our children were added as well. That’s not taken into account in measures of our productivity either. Yet caring for each other is the major contribution to our well-being, our quality of life, and the strength and potential of our country. This work is unpaid, but it has significant economic value.
What Are Social Wealth Economic Indicators?
The practice of counting assets, income, employment and productivity is familiar. Equally important, but less common, is the idea of accounting for the non-monetary contributions people make. Our national wealth includes investments that make people productive, such as early childhood education, good health, gender and racial equity, and the unpaid care of the young or old, the elderly or the sick. The investments we make in each other, the caring, does not have a dollar figure attached. But it creates an economic good, and it requires an economic price from those who do the caring.
Women’s advocates and others are pushing hard right now to get figures representing the cost of this carework included in metrics concerning business cycles, our spending and consumption, and other aspects of economic activity. Their success will positively impact women’s status, how we live and work, and what kind of society we become. It will also narrow the pay gap, move pro-family policies like paid leave and paid sick days closer to realization, and promote women’s leadership.
How will social wealth economic indicators improve women’s lives?
Women are more likely than men to be poor at all ages, but in later life their poverty rate is twice that of men’s. That’s because at that point several economic facts combine to make the difference glaring.
Women as a whole earn less than men throughout their work lives because of the persistent gender pay gap. Because they earn less, they save less. Fewer women work in jobs that offer pensions to provide support in retirement. They are also more likely to have interruptions to paid employment due to family care obligations. In addition to losing income during these periods, they earn less and advance more slowly after returning to work. Having children tends to decrease women’s income. It has the opposite effect on men, who typically see their incomes rise.
The fact of the matter is that mothers spend twice as much time per week with their children than fathers. Mothers also do about twice as much housework. While that time may put a downward drag on women’s income and career progress, it has huge economic implications. A staggering amount of new research shows that a child’s experiences from birth to age 5 have already laid the foundation for that child’s development.
Mothers invest far more than fathers in “human capital”, a term used to describe the level of education, skills, and potential of people. The future of the economy and our global competitiveness hinge on how well-prepared our workforce is. What mothers do, what parents do, as their children’s first and best teachers is the single greatest influence on that future. It should be accounted for in the statistical analyses of our national wealth.
The quality of care a child receives in the pre-school years is a reliable predictor of his or her educational attainment, employment and income as an adult. Teaching a child patience, compassion, and cooperation takes place first in the home. Cultivating a child’s persistence and resilience pays off in the long run, minimizing the risk of incarceration, teen parenthood, poor health, and dropping out of school. Investing in the earliest years decreases the likelihood that the child will need the support of public assistance as an adult. It also enhances the child’s opportunity to develop his or her full human potential.
By accounting for the invisible but economically crucial work that occupies so much of women’s, especially mothers’, time, we are assigning it a monetary value and including it in the calculation of our national wealth. It changes the characterization of traditional women’s work from “non-productive” to one of essential economic contribution. It further elevates the social value of those who perform the unpaid labor of running households and bearing and raising children. Women’s lower status derives in part from the demeaned, devalued and diminished regard placed on unpaid domestic labor. By tracking and accounting for the economic contribution of that labor, women’s value in the paid labor market would be enhanced as well.
Family carework has worth, not just for the giver or the recipient, but to the economy and society as a whole. If it were culturally valued, men would be more likely to do more of it. The more of it men do, the more highly it is regarded in the culture. Women’s poverty would decrease, and their economic security would be bolstered. Paid family leave, flexible workplaces, and better child care would result. More children would be able to maximize their potential.
We all would benefit from that.