Women’s Contribution to National Income: The Unaccounted Economy

When you hear the term “national income” or GDP, what comes to mind? Most of us picture factories, software exports, bustling stock markets, and construction cranes. These are the visible, monetized engines of our economy. We measure their output, tax their profits, and track their growth. But what if I told you this picture is dramatically incomplete? What if a massive, essential part of our economy is running 24/7, right inside our own homes, completely off the books? This is the invisible, unaccounted-for economy of unpaid work-the cooking, cleaning, childcare, and elder care that keeps society functioning. And it’s an economy predominantly run by women.

Every single day, women and girls perform more than 16 billion hours of unpaid care and domestic work. That isn’t a weekly or yearly figure; it’s a daily one. This silent subsidy powers our paid economy. It’s what allows the paid workforce to go to work every day, fed, clothed, and with their families cared for. Yet, in the grand ledger of our nation’s wealth, this colossal contribution is often valued at zero. This isn’t just a statistical oversight; it’s a profound bias in how we define economic value, and it has very real consequences.

The great bias in our economic report card 🔗

At its core, a country’s Gross Domestic Product (GDP) is designed to measure the total value of all monetized goods and services produced within its borders. If you buy a meal at a restaurant, it’s in the GDP. If you pay for childcare, it’s in the GDP. But if you spend three hours cooking that same meal at home, or raise your own child, the conventional accounting system sees no economic value. The activity is the same, but the lack of a price tag makes it invisible to economists and policymakers.

This is where the bias becomes a powerful distortion. This vast realm of unpaid household and voluntary labour is not just “chores”; it is productive work. It creates value, sustains human capital, and ensures social well-being. The problem is, this work falls disproportionately on the shoulders of women.

Just how much value are we talking about? The numbers are staggering. In India, for example, a report by the State Bank of India (SBI) calculated the monetary value of women’s unpaid domestic work. The finding was explosive: this invisible work amounts to roughly 7.5 per cent of India’s entire GDP. To put that in perspective, it’s a contribution larger than many of our key organized sectors. We are, in effect, ignoring a massive part of our own economy simply because no money changes hands.

It’s not just about money, it’s about time 🔗

Before we can even calculate the monetary value, we have to understand the sheer scale of the time involved. This is where Time-Use Surveys (TUS) come in. These are detailed studies where people keep diaries of their activities, often down to 10- or 15-minute intervals, over a 24-hour period. For the first time, they give us a statistical snapshot of how a population *actually* lives.

India’s 2019 Time-Use Survey provided concrete, national-level data on this disparity. The findings confirmed what we anecdotally knew: the gender gap in unpaid work is a chasm. One analysis by the Observer Research Foundation (ORF) highlighted that women in India spend dramatically more time on unpaid work than men. In urban areas, women spend 9.6 times more time on these tasks than men do. In rural areas, it’s 8.2 times. Men might spend the majority of their day in paid employment, but women are often working a “double shift”-a full day of paid work followed by another “shift” of unpaid work at home.

When one half of the population is systematically dedicating more of its time to unpaid responsibilities, it directly impacts their ability to participate in the formal economy. It limits their career choices, their earning potential, their ability to build businesses, and ultimately, their economic independence.

Valuing the invisible: methods and debates 🔗

So, we have the time data. We know women are spending billions of hours on this work. What’s the next step? How do we translate those hours into a monetary figure that can be included in national accounts? This is where economists and statisticians have developed several methods, each with its own logic and complications.

The “comparable worth” or replacement cost method 🔗

This is the most intuitive and widely discussed method, often referred to in technical guides as the “third-party criterion.” The principle, as outlined by bodies like the UN, is simple: if you could, in theory, pay a third person to do a task, then that task is productive work. This method calculates the value of unpaid work by figuring out what it would cost to *replace* that labour with market services.

Think about it:

• Childcare: What is the hourly wage of a professional nanny or a daycare worker?
• Cooking: What would it cost to hire a personal chef or buy all meals as takeout?
• Cleaning: What is the going rate for a professional housekeeping service?
• Elder care: What does a home health aide or nursing assistant earn?

You add up all those hours from the Time-Use Survey and multiply them by the market wages for those equivalent jobs. This is precisely how the SBI report arrived at its 7.5 per cent of GDP figure. It’s a powerful tool because it uses the market’s own logic to expose a hypocrisy: the work has value when an outsider does it, but not when a family member (usually female) does it.

Other approaches and the big debate 🔗

Another common method is the opportunity cost method. This asks a different question: what is the value of the time the person *lost*? For example, if a woman with a master’s degree in engineering leaves her job to care for a child, the “opportunity cost” is the engineering salary she is no longer earning. This method often produces even higher valuations, but it’s more complex-is the “lost” time really equivalent to her previous job? What about women who didn’t have a paid job to begin with?

This entire exercise of “pricing the priceless” is, understandably, debated. Some critics argue that putting a price tag on acts of love and care is cold and transactional. Does it “commercialize” family? It’s a valid concern. But proponents argue that in a world driven by economic data, what is not counted does not count. If this work remains invisible in our national accounts, it will remain invisible in our public policies. Valuation is not about commercializing love; it’s about forcing a system that only speaks the language of money to finally recognize a massive, gendered economic contribution.

Beyond a simple number: care as a public good 🔗

While assigning a number like “7.5 per cent of GDP” is a crucial step for recognition, the conversation is now moving even further. The growing consensus is that caregiving isn’t just a private, domestic task. It is, in fact, the creation of a public good.

What is a public good? It’s something that benefits everyone in society, not just the person who “owns” it. Think of a lighthouse. It protects all ships, not just one. The work of care is a social lighthouse. When a parent raises a healthy, well-educated, and emotionally stable child, they are not just “raising their kid.” They are creating a future citizen, a future innovator, a future taxpayer, and a future member of society. Everyone benefits. When a family cares for an elderly relative, they are providing dignity and support that the public health system would otherwise have to shoulder.

The World Economic Forum has argued this exact point: care is the essential infrastructure that makes all other jobs possible. Without this foundation of unpaid (and paid) care, the formal, “productive” economy would grind to a halt. Globally, this work is estimated to be worth a staggering $11 trillion, or 9 per cent of global GDP. Recognizing care as a public good fundamentally changes the conversation. It’s no longer just a “women’s issue” or a “family matter”-it’s an economic imperative.

The growing consensus for compensation 🔗

If society as a whole benefits from this public good, then it’s logical to argue that society as a whole should share in the cost. This is the basis for the growing call for caregiver compensation. This doesn’t necessarily mean the government should pay everyone a “wage” to do their laundry. Instead, it means creating a robust care economy that recognizes, reduces, and redistributes this burden.

What does this compensation look like in practice?

1. Direct Support: This can include things like caregiver allowances or tax credits for those (often women) who have to leave the formal workforce to care for children or sick relatives.
2. Public Investment in Care Infrastructure: This is the big one. It means using public funds to build affordable, high-quality childcare centers, public elder care facilities, and respite services for families with disabilities. This “compensates” unpaid caregivers by giving them a viable alternative, freeing up their time to pursue paid work or education if they choose.
3. Policy Recognition: This includes mandating paid parental and family leave for *all* workers. When both parents are entitled to leave, it helps to redistribute the care work more evenly within the household.

By shifting our perspective from “private chore” to “public good,” we stop blaming individuals for “choosing” to leave the workforce and start building a society that supports the essential work of care. Including women’s contribution in our national income is the first step. Building a fair care economy is the destination.

What do you think? How would our public spending priorities (e.g., national and state budgets) change if this 7.5 per cent of GDP was officially included in our national accounts every year? Beyond money, what are other ways our local communities can better recognize and support the unpaid care work that families perform?

References

1. https://ilostat.ilo.org/topics/unpaid-work/measuring-unpaid-domestic-and-care-work/
2. https://theprint.in/economy/unpaid-domestic-work-of-women-amounts-to-7-5-of-gdp-latest-sbi-report-says/1409528/
3. https://www.orfonline.org/research/building-india-s-economy-on-the-backs-of-women-s-unpaid-work-a-gendered-analysis-of-time-use-data
4. https://www.weforum.org/stories/2024/10/caring-care-economy-key-growth-and-well-being/