The unpaid Americans’ work powering a $5.6 trillion ‘economy’

Americans across the country spend countless hours cleaning, taking care of loved ones and other household tasks. The value of that work may not always be as appreciated as it should be, but when put in financial terms, it’s an economy larger than all of Germany.

A new report from the U.S. Government Accountability Office (GAO) found the value of all that free work being done in the home to be roughly $5.6 trillion.

That would make it the third largest economy in the world.

“An official government agency, the Government Accountability Office, is finally paying attention to the economic value of unpaid work,” Nancy Folbre, professor emerita of economics at the University of Massachusetts Amherst, told Straight Arrow.

Housework value

That number rises to more than $7 trillion when secondary childcare is included. That means keeping an eye on a child while cooking dinner or cleaning, which almost never happens, right?

Despite that value, some still don’t think that’s high enough.

“It doesn’t take account of the opportunity costs,” Kathleen Gerson, professor of sociology at New York University, told Straight Arrow.  “If someone has made the decision to forgo earning an income in the labor market in order to perform this work. And I’m not presuming that they are, but for the people who do that, it’s not just a matter of how much value is attached to the work they’re doing at home.”

The GAO estimated a day’s worth of unpaid housework was equivalent to $70.

It assigned all the time a replacement wage, or, what someone else would have likely been paid had they done the same work.

Gerson believes that, too, has been undervalued.

“The chances are, depending on what part of the country you live in, but certainly in the places where people do tend to outsource this work, it’s far more expensive than $70 a day to do so,” she said.

Childcare Aware of America estimates that childcare alone costs Americans $51 per day on average. Care.com estimates the national hourly average for a house cleaner is $21.29 per hour.

All of this household work is being done by more than 87% of the population, according to the report, the most all Americans have had in common in many years.

“The triggers that led to increased consciousness of the importance of household production was the closing of institutions that we had relied upon and that were replacing household production,” Shoshana Grossbard, retired professor of economics at San Diego State University, told Straight Arrow. “Places like old age homes, schools, big air centers, even restaurants.”

Changing dynamics

Like most things in the last half-decade, this has been impacted by the COVID-19 pandemic. For starters, just in terms of awareness.

“COVID was a major event that has raised people’s consciousness of what goes on in the home,” Grossbard said. “Because people were home, they couldn’t go to work. They couldn’t go to school, and then the children couldn’t go to school, and it became very obvious that household production is of primary importance.”

Then there’s the influx of remote work that has persisted on some level since the pandemic. That number more than doubled from 2019 to 2023.

With so many parents also working from home, it’s blurred the lines a bit between work and home.

“During the pandemic, working from home, or, more precisely, engaging in paid employment from home, made it easier for people to combine family work with paid work,” Folbre said. “It almost certainly increased overall efficiency as a result.”

The report found women made up 54% of people doing this work despite being 51% of the population.

It also found women spent more time per day doing this work, although not by much. The GAO estimated women spend 3.17 hours per day compared to 3.11 in men.

That gap has continued to close over the last several decades and has shifted drastically since the America of the 1960s.

“Women have become more active in the labor force,” Grossbard said. “But it’s still the case that a bulk of caregiving and household production of all different kinds is done by women.”

The GAO measured that gap using several years of data from the American Time Use Survey.

“While the report does acknowledge there’s greater involvement among mothers than fathers, it certainly doesn’t seem to measure the extent to it of that difference,” Gerson said. “It’s absolutely true that men are becoming more involved, and I wish I could say that the gap has narrowed to the extent that it seems to be reported here, but I can’t say that.”

Another factor in the increase in household work is that the American population is aging.

Americans 65 and older now make up about 18% of the population. That’s compared to just 12% in 2000.

The report found 71% of people providing unpaid adult care were providing eldercare. They were estimated to spend a little more than three hours a day providing that care. This phenomenon is known as the “sandwich generation.”

“The needs for elder care is increasing,” Grossbard said. “So that’s another reason why politicians and policymakers of various kinds, who are concerned with aging, are thinking more of the alternative to institutionalized care, which is caregiving at home. And there you have two major options: you can hire people to come to your home and pay them, or you can have the household members doing the care.”

Good or bad?

So, what does all of this mean?

“The report has no real implications for the economy itself, but it improves our understanding of what’s going on,” Folbre said. “For instance, one of the reasons economic growth rates seemed faster between 1970 and 1995 than in recent years is that married women were entering paid employment at a rapid rate — the wages they began to earn were counted as part of Gross Domestic Product, and the reduction in time they devoted to housework and childcare was ignored.”

The GAO says measuring this alongside the GDP gives a more comprehensive picture of the U.S. economy and economic activity. The report also says this could help inform future policy, especially when it comes to caregiving.

It mentions things like Social Security caregiver credits or tax policy changes.

“It’s also sadly a matter of partisan politics these days, and so my best-informed guess on how an American citizen will react to this will depend upon the details of their own daily lives,” Gerson said. “To what extent do they feel either more or less responsible for this work?”

The report was originally requested by Sen. Kirsten Gillibrand, D-N.Y. She has not yet commented publicly on the findings, nor has any other politician.

Gerson says the changing dynamics are an important reason why politicians should be paying attention to this.

“As men and children increasingly depend on women’s earnings, then we also need to tackle the inequalities that still persist,” she said. “The demographic forces at work are very clear, and we are living in a new era. We’re not going back to a previous historical period. And our challenge now is not to fight over what kind of families we want to have. It’s to acknowledge the changed situation and meet the challenges.”

With women historically, and currently, doing most of the unpaid household work, it’s put them at a greater economic disadvantage. But could more awareness of this help bring about change?

“I’d like to think that more recognition of its economic value will encourage more men to step up,” Folbre said. “The time use data itself suggests that this is happening.”

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