Economies are characterised by interdependence. That means that
what we produce - whether marketed or not - is a result of coordination;
of teamwork between the owners of capital and the owners of labour,
and between many different workers, paid, unpaid, and underpaid.
Unpaid work is work that does not feature in the national accounts
because it is not marketed, but it may nevertheless contribute
to a nation's Gross Domestic Product (GDP). Work that is produced
and consumed within the household economy (or the voluntary sector)
only affects GDP inasmuch as it may involve inputs that are purchased
from the market economy. (The work itself can however be said
to be a part of a wider measure of production than GDP: "Gross
Economic Product".)
Work performed without pay in support of a partner, relative, agent etc. who is producing in the market economy does however contribute to GDP. However, given the structure of the national accounts, the value of that work is attributed to the business of the partner, relative or agent such as a partner's employer or client.
Some such unpaid contributions are acknowledged, though, in the
Household Labour Force Survey (HLFS), and in the Census. In both
of these, a person who normally works without pay in a "relative's"
business for one hour or more per week is classed as employed.
(The census specifically excused such persons from answering the
question about whether they were looking for work on the grounds
that, in the words of one Statistics New Zealand staffer, "we
are not interested in whether employed people are searching for
work").
Other unpaid contributions - eg working for a school's Board of
Trustees - are acknowledged elsewhere in the census, as voluntary
work. The "inputs" of the Board of Trustees directly
contributes to a school's "outputs", which are measured
in the GDP statistics. So does the unpaid overtime put in by school
principals and teachers. Principals and teachers, by being partly
unpaid, can be said to be underpaid.
Being unpaid and underpaid are part of the same phenomenon. Being
unpaid is an extreme form of underpayment. Underpaid workers contributing
to the market economy give part or all of the value of their work
to others; typically to their employers, or to their employers'
employers (eg where they are employed by subcontractors). Unpaid
domestic workers - especially mothers (who in many cases are,
in addition, paid workers) - produce whole generations to help
produce the GDP of the future.
Each new generation claims the private incomes of the future;
private incomes made possible in large part by their inheritance
of the product of the paid and unpaid work of preceding generations,
as well as by their own work, and their partners' often unpaid
work.
Since the 1991 Employment Contracts Act, underpaid workers have
increasingly contributed by accepting less for doing more. They
contribute through their product, and not through their taxes.
(Exploited workers produce a lot, but it is the exploiters who
own and sell what the workers' produce who pay most of the taxes,
by virtue of the fact that the employers of exploited labour have
much higher incomes than do exploited workers. Exploitation always
takes place when a labour market is oversupplied.)
It is only when underpaid and unpaid workers become eligible
for a public pension that they get some monetary recognition for
what they give up as workers. That is reason enough for any society
to pay a public pension. On the other hand, a belief in
retirement incomes that are proportionate to workers' paid incomes
during their working lives - ie the proceeds of savings or insurance
schemes - assumes that individuals' incomes accurately represent
their contributions.
When seen in this light, a public pension seems like a pittance;
a minimal recognition of the contribution of unpaid and underpaid
workers, if that. Even so, public pensions are under threat. Young
people today have been conditioned into believing that they may
not get any public retirement income.
By an extension of the reasoning that sees a public pension as
a reward for all service and not just paid service, it seems appropriate
to recognise such contributions for people of working age as well
as those of retirement age. Such recognition would mean the paying
of a social dividend if not a full universal basic income (UBI).
A social dividend, which can be constructed at little cost
from existing tax concessions, can be important as a recognition,
within the public accounting framework, of our unpaid and underpaid
contributions. A public pension could then be seen as
an additional recognition; a long service bonus.
In an interdependent world, it is virtually impossible to assess
every person's individual contribution to the economic wellbeing
of the nation, let alone to the wellbeing of the planet. So a
universal means of attributing value to contributions is appropriate;
a means that errs in favour of the proposition that everyone makes
a contribution, or at least wishes to.
The bureaucratic cost of punishing the few who do not make any
public contribution (or who are deemed not to make any contribution)
is just not worth it. The withholding of entitlements should not
be used as a form of punishing people thought by some to be lacking
a work ethic. Work is not the only form of contribution, and nor
has it ever been the only basis for a person receiving a paid
income.
We need to modify our public accounts so as to give explicit recognition
of unpaid and underpaid contributions to GDP. Our social wage
should include a social dividend and a public pension.
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