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Working women make us all richer

  • Published at 11:44 pm October 14th, 2017
Working women make us all richer
A new report, “Different images of men,” tells us that women spend much more time in unpaid labour than men do in Bangladesh. This should not be a surprise, this is just how things are. Or rather, this is how things have been just about everywhere and every-when. The change comes as a country grows, as GDP rises. Partly, it’s as a result of that increase in economic development, partly it’s the cause of that increase. The basic finding is that, on average of course, women spend one hour a day in paid employment and eight in unpaid – men a little over five hours in paid and 90 minutes in unpaid. As I say, this is the historical norm. It is so because a large part of what is being paid for in a basic economy is human muscle power. That’s something men have more of and so men tend to be doing more work out there in that paid market economy. However, we should note that the individual is not really the basic economic unit, instead that’s the household. Certainly, there will be cultural issues about who does what within a household but across most societies we do see much the same result. Males specialise in that paid market work, females in the unpaid household work. The end result being that everything does get done. This then changes as an economy grows. By far the largest change in the rich economies in the 20th century was the manner in which women stopped specialising in only that household work and moved out into the paid and market economy.
This move of women from the household into the market also increases output, the very same thing as saying that it makes us richer
But it’s important to realise how this happened. Actually, the biggest change was the fall in unpaid household working hours for women – the rise in market paid hours for them was smaller. That is, the balancing item, leisure, rose. Male unpaid house and market hours fell, equally increasing leisure. For what happened was that we mechanised, automated, much of the labour required to run a household. The economists Hans Roslin and Ha Joon Chang both refer to this as the “washing machine” by which they mean the whole household technology revolution, stoves, cooking with gas or electricity, washing machines, vacuum cleaners, microwaves, and on and on. This automation of some half of the household workload – one estimate is that in 1900 in the UK it took 60 hours of labour to run a house, today about 15 in a week – is what enabled women to go out and work in the market. But that’s not the only change. The general automation of society also helped. For working for pay these days simply doesn’t require human muscle power. There are simply very few jobs left where this is true in the rich countries. It’s human brainpower which is being hired and women are just as good at that as men. So we’ve two effects working here as a society gets richer. The first is that we’re using the machines to do all of the heavy lifting in paid work, meaning that women can compete on an equal footing. We’re also getting the machines to do the household work, freeing up that time that women can do more paid work in – and also gaining more leisure. Both of these are symptoms of the society getting richer, it’s able to afford all that machinery. But women going out to work is also one of the things which makes a country richer. Part of this is just the way that we measure GDP. We’re only recording market transactions, those things which have a price. Housework famously doesn’t have a price so it’s not included. If my wife cleans my house then that’s not in GDP. If my wife cleans yours and gets paid for it, your wife cleans mine and gets paid, we’ve the same work happening but GDP has increased, just because we now count it as being part of the economy. And of course some women are indeed doing work that previously was taking part in the household, unpaid. In that sense we’re no better off with our rising GDP. However, there’s another issue here. Which is Adam Smith’s old one of the division and specialisation of labour – that example of the pin factory again. If we are able to split the work up among different people and each of us concentrate on just the one part of the process then we all become more efficient at our little bit of it. That means that for the same effort going in we get more production out – we’re all collectively richer in short. Our problem with household production is that there are usually only two adults in a household. That ability to divide and specialise is therefore very limited. By moving things out into the paid world of market work, it’s possible to divide much more finely. In theory, we can divide among all 7 billion people on the planet, something that really does allow a considerable amount of specialisation. As an example, for some years, I was pretty much the only person in the world who was a dealer in the metal scandium. Very small market, it only needed one specialist for all of us and I was it. That’s extreme of course but it does illustrate. This move of women from the household into the market therefore also increases output, the very same thing as saying that it makes us richer. As is so often true in matters economic we’ve two things going on here. Getting richer is what enables women to do more market and paid work – the machines take the strain at home and also at work. But the process of women going to work makes us richer as a result of the increased division and specialisation of labour. The end result in Bangladesh will be as it is elsewhere in richer countries. As the country gets richer, something both caused by and contributing to it getting richer, the work patterns of men and women will converge. Perhaps not to total equality as women do tend to still do more of the childcare but even this is changing, but certainly much closer to it.   Tim Worstall is a Senior Fellow at the Adam Smith Institute in London.