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Measuring Unpaid Workin New Zealand 1999

Published in May 2001 by

Statistics New ZealandTe Tari Tatau

Wellington, New Zealand

ISBN 0-478-20772-7

Preface

Brian PinkGovernment Statistician

New Zealanders aged 15 years and older spend, on average, more time in unpaidwork than they do in paid employment. Unpaid work accounts for 25 percentof people’s waking hours, and to date this work has not, for the most part,formed part of the recorded economic activity of our society. Yet its sheervolume and its relationship with paid work means we may be ignoring asignificant amount of productive activity. It was for this reason that the Systemof National Accounts 1993 guidelines recommended that countries developsatellite accounts to value household production.

Measuring Unpaid Work in New Zealand 1999 presents initial steps towardthe development of a household satellite account for New Zealand by valuingthe labour component of a household production account. It builds on workpresented in a similar publication, Options for Valuing Unpaid Work in NewZealand 1991, and follows guidelines proposed in a recent Eurostat workingpaper.

This publication will be of interest to those who contribute to, or benefit from,the labours of household work. The report has been compiled using data fromthe 1998/99 Time Use Survey and the New Zealand Income Survey. Its coverageincludes activities such as housework, caring for children, preparation of meals,cleaning clothes and performing tasks for other households and non-profitinstitutions serving households. Based on the underlying data, analysis bystatus of individual is undertaken which marks the differences in time usebetween Mäori and non-Mäori, and highlights the significant role of femalesin the household sector.

This report is the result of a project initiated, and partly funded, by the Ministryof Women’s Affairs. Their role in the production of Measuring Unpaid Workin New Zealand 1999 is gratefully acknowledged.

Statistics New Zealand would like to acknowledge the contribution made bythe following staff members: Jeff Cope, Fiona Smillie, Emma Plank, PaulSatherley and Mark Walton. Special thanks are given to Dr Duncan Ironmonger,of the University of Melbourne, for his contribution as a consultant to theproject.

This report was published by the Publishing and Library Services Division ofStatistics New Zealand.

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Standards

Percentage changesPercentage movements are, in anumber of cases, calculated usingdata of greater precision thanpublished. This could result in slightvariations.

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P provisional

E early estimate

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ContentsPage

1. Introduction 111.1 Why value unpaid work? 111.2 The international context 121.3 Developing a household satellite account 13

2. Key findings 152.1 Summary 152.2 Value of unpaid work 152.3 Unpaid work outside the household 152.4 Principal functions of household production 162.5 Gender comparison 182.6 Mäori/non-Mäori comparison 182.7 Simultaneous activity 182.8 Comparison with Australia and other countries 19

3. A framework for measuring household production 213.1 The household sector in the system of national accounts 213.2 The scope of household production 213.3 The SNA production boundary 233.4 Household satellite accounts 253.5 Unpaid work for non-profit institutions 263.6 Accounting for household production 273.7 Going beyond the production account 29

4. Measuring household production 314.1 What household activities are included in unpaid work? 314.2 Classifying unpaid work activities 334.3 Valuing household production 354.4 Valuing unpaid work 38

5. Unpaid work analysed by status of individual 455.1 Unpaid work: all persons 465.2 Unpaid work: female/male 475.3 Unpaid work: Mäori / non-Mäori 485.4 Unpaid work: persons in households with/without children 505.5 Unpaid work: persons employed/not employed 525.6 Unpaid work: primary and secondary activity by gender 54

Appendix 1: About the surveys 57A1.1 The time use survey 57A1.2 The New Zealand income survey 58

Appendix 2: Splitting time use survey codes into activities 61A2.1 Time use survey codes 61

Appendix 3: Comparisons with 1991 67A3.1 Differences between the two estimates 67A3.2 Demographic changes 68

Appendix 4: Glossary of terms 69

References 71

Contents - continued

11Measuring Unpaid Work in New Zealand 1999

1. IntroductionAccounting for household production requires an expansion of the conventional national accountingproduction boundary, and it is generally accepted that constructing a household satellite account is thepreferred approach. A complete household satellite account would contain a comprehensive and integratedpresentation of those household economic activities that contribute to individual welfare, such as production,income redistribution and wealth accumulation. This report does not contain a full household satelliteaccount; rather, it represents the first step: identifying and measuring a key component, namely, the unpaidwork component of household production.

This report has been produced by Statistics New Zealand with the financial support of the Ministry ofWomen’s Affairs. The timing of this work is no coincidence. A national Time Use Survey was conductedby Statistics New Zealand for the Ministry of Women’s Affairs for the 12 months ending June 1999, andprovides the key data source needed to develop estimates of unpaid work by householders.

It is important to note that the scope of this report is limited to people aged 15 years and over, which isconsistent with the Household Labour Force Survey definition of the working-age population.

The report is divided into five main sections:

Section 1: explains why unpaid work should be valued and provides background information on theinternational move to extend core national accounts to include household production

Section 2: summarises the valuation results for unpaid work in New Zealand

Section 3: defines the scope of production and unpaid work, and describes the satellite account frameworkused for measuring household production

Section 4: begins by classifying all activities into productive and non-productive activities and then goes onto show how productive unpaid work can be further split into 5 principal functions. It also outlines thealternative valuation methods

Section 5: using data from the 1999 Time Use Survey, provides further tables analysing hours spent inunpaid work by individual characteristics, such as gender, Mäori/non-Mäori, persons in households with/without children and persons employed/not employed.

1.1 Why value unpaid work?“The economic statistics of work and production are used extensively in framing public policy and in businessdecisions. Thus it matters a very great deal what activities we understand, define and measure as ‘work’ and‘leisure’ because .... the reporting on the measured ‘variables’ actually affects our lives through practicalgovernment and business decisions.”1

Conventional economic statistics, such as the national accounts and employment measures, are largelydesigned to measure the market economy and exclude (in developed economies at least) most of the non-market productive activities occurring within the household. Yet it is clear that the goods and servicesresulting from these activities are a source of utility to the members of the household and contribute to theirwell-being. Moreover, the volume of household production is significant: on average, people spend moretime in unpaid work than they do in market work. Welfare studies need to adopt a more comprehensiveanalysis of production and consumption, and to track these over time as individuals shift their allocation ofavailable hours between paid (market) work, unpaid work and leisure. Statistics on the value of unpaidwork linked to time-use analyses contribute to these studies.

1 Ironmonger D (1996), “Counting Outputs, Capital Inputs and Caring Labor: Estimating Gross Household Product”, FeministEconomics 2(3), 1996, page 38.

12 Measuring Unpaid Work in New Zealand 1999

This comprehensive approach is encouraged if one envisages two distinct economies: the ‘household economy’which describes the collective economic activities of households, and the ‘market economy’ which coversthe rest of the economy.2 In this structure, the household economy is analysed as a major source of production,not just consumption, and the transactions between the two economies are quite explicit. While the marketeconomy provides products not produced by households, in many cases the two can be viewed as being incompetition, such as providing accommodation, meals, childcare, clothing and so on. For some products, itis more convenient or more efficient for the market to produce them, while the opposite may apply for otherproducts. This may change over time and a focus solely on the market economy may provide a misleadingpicture.

Another example demonstrating the inter-linkages between market and household sectors is women rejoiningthe workforce. In recent years, more women have rejoined the paid workforce after having children. Womenwho are employed may now find they need to hire a cleaner to clean their house or pay for childcare services,as opposed to doing this work themselves. Under the System of National Accounts (SNA), this implies that themarket economy is more productive (as the cleaner, childcare worker and the woman are all included in marketactivities), when, really, much of this is just a switch from household production to market production. Thesame jobs are being done - that is, the house is being cleaned and the children are being cared for.

In the other direction, the market is pushing some activities back to the household by, for example, producing‘labour saving devices’ that allow householders to make their own bread or carry out their own houserenovations. There are also switches between the government and household sectors, as illustrated byrecent policy shifts to deinstitutionalise mental health care and to shorten post-operative hospital stays. Inorder to understand the net effect of these interactions on all sectors, a comprehensive approach, embracingboth market and household production, is required.

Valuing unpaid work makes it possible to compare the value of goods and services produced in the marketsector with those produced in the household sector. It recognises that household work has a value andmakes visible what has previously been hidden.

1.2 The international contextThe national accounts are universally recognised - if not universally accepted - as the authoritative statement ofthe value of a nation’s output and the incomes generated in its production. However, even though an internationalconsensus on the fundamental framework of the accounts has existed since the 1950s3, they have been frequentlycriticised for failing to record some important aspects of economic activity. In particular, the focus on marketedgoods and services has led to claims that by excluding, among other things, the unpaid work occurring in thehome, the accounts are conceptually inconsistent and, as a measure of economic activity, incomplete.

International pressure to extend the scope of the accounts to include household production has been buildingfor a number of decades. In the Nairobi Forward-looking Strategies for the Advancement of Women to theYear 20004, adopted by the United Nations in 1985, it was resolved that:

“The remunerated and, in particular, the unremunerated contributions of women to all aspects andsectors of development should be recognised, and appropriate efforts should be made to measure andreflect these contributions in national accounts and economic statistics and in the gross nationalproduct.”

2 Ironmonger D (unpublished), “Household Production”, International Encyclopedia of Social & Behavioural Sciences.3 The first international standard, the United Nations System of National Accounts, was published in 1953.4 Report of the World Conference to Review and Appraise the Achievements of the United Nations Decade for Women: Equality,

Development and Peace, Forward-looking Strategies for the Advancement of Women to the Year 2000, Nairobi, July 1985.


While this recommendation - and similar ones from other subsequent international gatherings - was nodoubt prominent in the thinking of the expert groups charged with drafting the revised 1993 System ofNational Accounts (SNA93), the new standard largely confirmed the status quo with regards to the boundaryof production in the conventional gross domestic product (GDP) measure. It did, however, recognise theimportance of household production and strongly supported the development of supplementary or satelliteaccounts to provide a more comprehensive picture of economic production. Work to progress this developmenthas now reached the stage where there is growing agreement on the content and valuation conventions for ahousehold satellite account. Eurostat (the statistical office of the European Commission) is currently workingon a manual for a satellite account of household production and the United Nations Statistical Division hasrecently published Household Accounting: Experience in Concepts and Compilation as part of its “Handbookof National Accounting” series.

In New Zealand, support for a change to the conventional national accounts has been championed by MarilynWaring5, with subsequent support from the Ministry of Women’s Affairs. In 1990, Statistics New Zealandundertook an external review of the official macroeconomic statistics, the intention being to identify anydeficiencies in those statistics and to recommend measures to improve their quality. The Ministry of Women’sAffairs made a comprehensive submission to the review, advocating, among other things, that the nationalaccounts core framework be extended to include both market and non-market production. The reviewcommittee, aware that the SNA was under review and likely to recommend a satellite account approach forextensions to the core accounts, considered it prudent to wait for an international consensus to emergebefore proceeding with the development of any official, alternative measures.

The consensus that has emerged generally supports the satellite account approach, as outlined in the SNA93and the handbooks mentioned above.

1.3 Developing a household satellite accountThis report represents the first step toward developing a satellite account of household production by valuingunpaid household activities, while adopting the concepts and definitions consistent with a full satelliteaccount. Extending this work developing the full account remains on the research agenda, although it seemslikely that many of the components needed are available from other data sources or the national accountsthemselves.

The preparation of a full satellite account is not, of course, an end in itself; rather it is a means to betterunderstanding the economic dynamics both within and between households, and between the household andother sectors in the economy. The account provides a database consistent with conventional economicaccounts, which allows a structured analysis of the household economy within the context of conventionalnational measures.

The valuation of the labour component of unpaid work presented in this report has highlighted the contributionof females to total productive activity through their significant role in unpaid work. It has also highlightedthe contribution of those who assist other households and institutions through voluntary, unpaid labour.

This report recommends that future work build on the foundation presented here by investigating the feasibilityof compiling a full household production account for New Zealand.

5 Waring, M (1988), Counting for Nothing: What Men Value and What Women are Worth, Allen and Unwin, Wellington.



2. Key findings2.1 Summary

• New Zealanders spent 4,129 million hours on unpaid work in 1999. This equates to an average of27.6 hours per week for all persons aged 15 and over, which is greater than the average 23.6 hours perweek in paid employment.

• The estimated value of unpaid work in New Zealand in 1999 was $39,637 million, equivalent to 39percent of gross domestic product (GDP).

• Eighty-seven percent of unpaid work occurred inside the household, while the remaining 13 percentwas for the benefit of the community or persons outside the household.

• New Zealanders contributed 247 million hours of formal, unpaid work outside the household in 1999.

• Women accounted for 64 percent of the total estimated value of unpaid work in 1999.

2.2 Value of unpaid workTime Use Survey results for 1999 show that New Zealanders aged 15 and over spent 4,129 million hours onunpaid work, both within their own households and for other households and non-profit agencies. Applyinga median housekeeper wage from the New Zealand Income Survey to these hours yields an estimated totalvalue of unpaid work of $39,637 million.

The $39,637 million estimate, as Table 1 shows, was equivalent to 39 percent of GDP in 1998/1999.

2.3 Unpaid work outside the householdThe unpaid work of households benefits not only persons within the household but also the community andpersons living in other households. Table 2 shows that 87 percent of the value of unpaid work was for thebenefit of the household itself, while the remaining 13 percent was for the benefit of other households andthe community.

Table 2Value of unpaid work inside and outside the household

Value of unpaid work

$(million)

Proportion of total (%)

Unpaid work inside the household 34,581 87Informal unpaid work outside the household 2,686 7Formal unpaid work outside the household 2,370 6Total 39,637 100

Note: Figures may not add due to rounding


$(million)

Gross Domestic Product

$(million)

Percentage of Gross Domestic

Product (%)

Total 39,637 101,169 39

Table 1Value of unpaid work in New Zealand


The category of formal unpaid work outside the household represents unpaid work for non-profit institutionsserving households (NPISHs). Given that 2001 is the year of the volunteer, it is interesting to note that NewZealanders devote 247 million hours a year to formal unpaid work outside the household and that this workis valued at $2,370 million. Informal unpaid work outside the household represents unpaid work for thebenefit of other households.

In 1999, the contribution of NPISHs to GDP was estimated in the national accounts at $1,196 million, or 1.2percent of GDP. This value excludes any imputation for the unpaid work of individuals as members ofNPISHs. In this report, this unpaid work is valued at $2,370 million. If this was added to the existing figureto produce a truer measure of the value added contributed by NPISHs activities, the contribution of thissector to GDP would increase to 3.4 percent.

2.4 Principal functions of household productionAll household activities can be split into two mutually-exclusive categories, productive and non-productive,based on the ‘third party criterion’. This criterion states that an activity is productive if it can be delegated toa third party (and still derive benefit). Hence, preparing a meal is productive, while eating it is not. Productiveactivities can be further split into market work and unpaid work.

This is illustrated in Figure 1, which shows how the average person aged 15 years and over spends the 168hours available per week. The 4,129 million hours spent on unpaid work activities in 1999 equate to anaverage of 27.6 hours per person each week. In comparison, an average of 23.6 hours per week are spent onmarket work. In other words, people spend more time, on average, in unpaid work than they do in marketwork.

Using Time Use Survey data, the unpaid work category can be broken down further into detailed activities.These activities have been grouped into the principal functions or types of household work, which largelycoincide with basic human needs, namely the provision of shelter, food, clothing and care (personal andfamily). A fifth function, doing unpaid work outside the household, is also shown. In order to perform thesefunctions, households undertake a number of related ancillary activities. Cleaning, for example, is an ancillaryservice to the provision of housing; shopping for food to the provision of nutrition. Thus, the productiveactivities of households can be classified either to the principal function or as an ancillary to it. This isshown in Table 3 and Figure 2. It can be seen that the two household functions that contributed most to totalunpaid work were nutrition, which accounted for 28 percent, and housing, which contributed 27 percent.Care formed the third largest function, accounting for 22 percent of total unpaid work.

Figure 1Average weekly hours per person by type of activity


Applying a median housekeeper wage of $9.60 per hour to the 27.6 hours spent on unpaid work results in anannual ‘salary’ of $13,820 for the average unpaid household worker. This salary and its breakdown into theprincipal functions of household production are shown in Table 4.

Figure 2Unpaid work by principal function

Table 3Average weekly unpaid work per person

by principal function and activity

Table 4Average annual unpaid work per person


Hours

Activities Housing Nutrition Clothing Care

Unpaid work

inside the house-

hold

Informal unpaid work outside the household

Unpaid work for house-holds

Formal unpaid work outside the household

Total unpaid work

Principal 0.3 2.9 0.1 3.9 7.3 1.5 8.8 1.4 10.2Ancillary Shopping 0.4 1.0 0.8 0.4 2.6 0.0 2.6 0.0 2.6

Maintenance 1.3 0.0 0.3 0.8 2.4 0.0 2.4 0.0 2.4Gardening 0.6 0.2 0.0 0.0 0.9 0.0 0.9 0.0 0.9Cleaning 3.8 2.8 1.1 0.0 7.7 0.0 7.7 0.0 7.7Transportation 0.9 0.6 0.5 0.9 2.9 0.5 3.4 0.2 3.6Management 0.2 0.2 0.0 0.0 0.5 0.0 0.5 0.0 0.5Total 7.4 7.8 2.8 6.1 24.1 1.9 26.0 1.7 27.6

Percentage of Total Unpaid Work (percent) 27 28 10 22 87 7 94 6 100


Principal functions of household production

Dollars


Unpaid work

inside the house-

hold


Unpaid work for

households


Total unpaid work

Principal 155 1,465 71 1,947 3,638 729 4,367 721 5,088Ancillary Shopping 192 511 383 192 1,277 0 1,277 0 1,277

Maintenance 635 0 140 410 1,185 0 1,185 0 1,185Gardening 308 120 0 0 428 0 428 0 428Cleaning 1,886 1,386 560 0 3,832 0 3,832 0 3,832Transportation 461 311 233 460 1,464 208 1,672 105 1,777Management 93 93 23 23 233 0 233 0 233Total 3,729 3,886 1,410 3,032 12,058 936 12,994 827 13,820




2.5 Gender comparisonAcross all productive time activities, females and males had very similar time commitments - on averagefemales worked for 51.0 hours per person per week and males 51.4. However, the split between paid(market) and unpaid work activities was noticeably different. Females are responsible for the majority ofunpaid work, recording 34.5 hours per person per week, compared with 20.3 hours for males. As a result, in1999, females accounted for 64 percent of the total value of unpaid work in New Zealand. Table 5 comparesvaluation estimates for females and males.

Table 5Value of unpaid work

Gender comparisonValue of

unpaid work$(million)

Proportion of total (%)

Female 25,472 64Male 14,168 36Total 39,637 100


Looked at from a different perspective, only one-third (16.5 hours per person per week) of females productivetime occurs in the market and is therefore captured in conventional economic statistics. The remaining two-thirds (34.5 hours per person per week) is unpaid and remains ‘hidden’. For males, the opposite situationapplies: two-thirds of their productive time is in the market and one-third is unpaid.

2.6 Mäori/non-Mäori comparisonThere are few major differences between Mäori and non-Mäori in either the average hours spent on unpaidwork or the activity breakdown of it. Mäori record slightly higher hours per person per week (28.7 hours)than non-Mäori (27.4) and account for 13 percent of the total value of unpaid work (see Table 6). This isvery similar to the Mäori proportion of total population aged 15+ (12.6 percent).

A difference does arise in market work, with Mäori working 19.9 hours per person per week compared with24.1 hours for non-Mäori. A probable contributing factor is the younger age structure of the Mäori population.

2.7 Simultaneous activityRespondents in the Time Use Survey could report participation in more than one activity at the same time.This allowed separate recording of time spent on a primary activity, plus any number of simultaneousactivities, some of which fall into the categories classified to unpaid work. While results presented in thisreport are for primary activities only, there is some interest in the contribution simultaneous activities mightmake to the value of unpaid work. Valuing simultaneous activities poses a number of conceptual problemsand, in line with most international studies, it was decided to exclude these from the main results. (Refersection 4.4 Valuing unpaid work)6.

Table 6Value of unpaid work

Mäori/non-Mäori comparison

6 The valuations of simultaneous time given in Table 7 exclude the ‘available for care’ code.

Value of unpaidwork

$(million)

Proportion oftotal(%)

Mäori 5,188 13Non-Mäori 34,449 87Total 39,637 100



Table 7 shows that households spent 886 million hours in simultaneous time unpaid work activities in 1999.The value of this work was $8,504 million. Adding this to the value of unpaid work in primary timeactivities yields a total value for unpaid work of $48,141 million (48 percent of GDP). Note that the valuationsof simultaneous activities given in Table 7 exclude the ‘available for care’ code. Refer to section 4.4 Valuingunpaid work for further discussion.

2.8 Comparison with Australia and other countriesAustralian data for 1997, based on a housekeeper replacement wage, valued unpaid work at 43 percent ofGDP7, higher than the 39 percent estimated for New Zealand. Both countries averaged 237 minutes per dayper person in unpaid work.

A strict comparison of the unpaid work : GDP ratios between New Zealand and Australia - and othercountries (see Table 8) - should be treated with caution. One would expect the ratios to reflect a wide rangeof factors, such as the nature of the economy, population structure, cultural norms, climate and labour forceparticipation rates. However, variations will also arise due to differences in the reference period, methodology,population coverage, choice of wage rate, etc. For the Australian comparison, it is believed these ‘statistical’differences are not major.

Table 8Unpaid work

Australia comparison

Table 9 compares unpaid work with GDP in six countries. The valuation method column refers to themethods used to estimate the value added from unpaid work. For more discussion on different approaches,see section 4. More comparisons can be found in the Australian Bureau of Statistics publication UnpaidWork in the Australian Economy 19978 and the Statistics Canada publication National Studies of the Valueof Unpaid Work: a Comparison of Methods9.

7 Australian Bureau of Statistics (2000) Unpaid Work in the Australian Economy 1997, page 5, Australian Bureau of Statistics,Canberra.

8 Australian Bureau of Statistics (2000) Unpaid Work in the Australian Economy 1997, page 60, Australian Bureau of Statistics,Canberra.

9 Statistics Canada (1996) National Studies of the Value of Unpaid Work: A Comparison of Methods, page 4, Statistics Canada,Ottawa.

Table 7Value of all time in unpaid work

Hours of unpaid work

(million)


$(million)

Primary activity 4,129 39,637Other simultaneous activities 886 8,504Total 5,015 48,141


Average minutes per day


$(billion)

Percentage of Gross Domestic

Product (%)

Australia 1997 237 ($A) 238 431999 237 ($NZ) 40 39

Australian figures sourced from: Australian Bureau of Statistics(2000) Unpaid Work and the Australian Economy 1997,Canberra.


Table 9Unpaid work

International comparisons

CountryValuation method

Year

Percentage of Gross

Domestic Product

(%)

Australia Net 1997 43Canada Net 1992 34Finland Input 1990 45Japan Net 1996 15New Zealand Net 1999 39Great Britain Net 1999 44

Note1:Sources:

(1) Australia, Canada, Finland: Australian Bureau of Statistics (2000) Unpaid Work and the Australian Economy 1997, Canberra.(2) Japan: Fukami, M (1996) Monetary Valuation of Unpaid Work in 1996 – Japan , India. (3) Great Britain: Short, S. (2000) Time Use Data in the Household Satellite Account - October 2000 , in Economic Trends October 2000, Office for National Statistics.

Note2: The comparisons are based on the replacement cost general housekeeper wage rate. For more information see section 4.4.


3: A framework for measuringhousehold production

3.1 The household sector in the system of national accountsThe New Zealand System of National Accounts (NZSNA) is a comprehensive accounting framework basedon the international standard, the System of National Accounts (SNA).10 The accounts are designed to meetthe needs of various groups, including government and private sector analysts and decision-takers. Thenational accounts provide a framework within which to organise an enormous number of economic trasactionsoccurring in the economy. By using consistent accounting definitions and concepts, they provide a coherentpicture of aggregate economic activity. This framework provides the necessary base for subsequent analyses,including the measurement of unpaid work.

To organise the data systematically, the accounts distinguish between (a) the transactors in the economy,such as market-oriented businesses, regulatory government bodies and households, and (b) their transactions,which record the interactions between these different transactors.

A household is defined in the system as “a small group of persons who share the same living accommodation,who pool some, or all, of their income and wealth and who consume certain types of goods and servicescollectively, mainly housing and food”.11 The individual members of multi-person households are not treatedas separate economic units, as many assets are owned and liabilities incurred jointly. Similarly, manyexpenditure decisions are made collectively.

This concept of a household is valid for the measurement of household production and no variation isrequired.

In the national accounts, the household sector consists of all resident households. This includes institutionalhouseholds, which can be viewed as a special type of household. They include people who permanentlyreside in an institution, or are expected to reside in one for a long time, such as prison inmates. In principle,the unpaid work occurring in these institutions should be included in the total value of household production.In practice, this is difficult to measure (e.g. the 1999 Time Use Survey and periodic Household EconomicSurveys exclude institutional households from their coverage) and no estimate has been included. Thisomission is not expected to have any major impact on the final estimates, as the amount of housework andvoluntary work undertaken by persons in institutional households is unlikely to be significant.

3.2 The scope of household productionIn order to measure the unpaid work undertaken by households, it is necessary to first distinguish thoseunpaid household activities that are deemed productive from those that would be considered leisure. Inother words, what constitutes unpaid work? This requires a more general discussion on production asdefined in the national accounts.

The concept of production is fundamental to the SNA and effectively defines the scope of key economicaggregates, such as gross domestic product (GDP) and other related income flows.

In the SNA, general production is understood to be a physical process, “carried out under the control andresponsibility of an institutional unit that uses inputs of labour, capital and goods and services to produceoutputs of goods and services. There must be an institutional unit that assumes responsibility for the processand owns any goods produced as outputs, or is entitled to be paid, or otherwise compensated, for the servicesprovided. A purely natural process without any human involvement or direction is not production in aneconomic sense”.12

10 Statistics New Zealand (1999) New Zealand System of National Accounts 1998, Statistics New Zealand, Wellington.11 System of National Accounts 1993, page 105, paragraph 4.132.12 System of National Accounts 1993, page 123, paragraph 6.15.


The SNA notes that the main problem for defining the range of productive activities concerns those activitieswhich produce goods and services that could have been supplied to other units, but are retained by theirproducers for their own use, or ‘own-account production’. This is particularly relevant for household activities,as many are solely for the benefit of the person undertaking them. How does one identify those householdactivities that are productive (work) as distinct from leisure? For example, how do we decide whetheractivities such as (a) washing clothes and preparing meals, and (b) washing oneself and eating, are to beclassified as work or not?

The solution is to adopt what has been referred to as the ‘third party criterion’, which was introduced byMargaret Reid in 193413. The basic idea is that for an activity to be considered productive it must be able tobe delegated to someone else. Hence, activities such as washing clothes and preparing meals, are productiveand fall within the general production boundary, while washing oneself and eating, are non-productive andoutside it. Recognising that production generally involves both labour and capital inputs, Ironmonger hasexpanded this criterion to what he calls the ‘market alternative criterion’. This states that “[a]n activity shallbe deemed productive if it is of such a character that it might be obtained by hiring a worker or by rentingcapital equipment in the market”.14 This expansion allows for the inclusion within the production boundaryof household services involving capital inputs only, for example, accommodation services provided by ahousehold’s own dwelling.

From the above, it can be seen that all goods and services which are produced by institutional units andwhich satisfy the market alternative criterion fall within the boundary of general production. This productionmay be actually destined for the market, whether for sale or barter, or for own consumption. It also includesall goods or services provided free to individual households or collectively to the community by governmentunits or non-profit institutions serving households (NPISHs). By definition, it includes all goods and servicesproduced within and by households.

However, the production boundary in the national accounts is more restricted than the general productionboundary described above. In the system, the emphasis is on monetary transactions and only the productionof goods and services that can be sold on markets, or at least be capable of being provided by one unit toanother, with or without charge, is included. The implications of this for household production is that theown-account production of goods is included, whereas services for own use are excluded. Hence, all goodsproduction by households, whether intended for sale or own use, is included in the production boundary,whereas only those household services actually destined for the market are included. (Housing servicesprovided by owner occupiers of dwellings being a notable exception.)

Households, of course, do not only produce non-marketed services for use within the same households.They are also involved in unpaid volunteer and community work, which benefits other households orinstitutional units other than their own. This work may be informally organised, as when individuals, orgroups of individuals, acting on their own initiative, help neighbours or the community without being paid.Alternatively, it may be done more formally through membership of a NPISH. In both cases, the activitiessatisfy the ‘third party criterion’, but are excluded from the scope of production in the national accounts.The informal voluntary services are excluded for the reasons given above, while the production of NPISHsexcludes any imputation for the unpaid volunteers who work for them. These volunteer activities have,therefore, been included in the scope of unpaid work, along with other household production omitted fromthe conventional production measures.

To summarise, if one looked at the range of household activities that result in the production of goods orservices for own consumption, we have the following split:

Within the SNA production boundary:

(a) The production of agricultural goods by household enterprises for own final consumption;

(b) The production of other goods for own final use by households: the construction of dwellings, theproduction of foodstuffs and clothing, etc;

13 This idea has subsequently been used by several researchers. See, for example, Ironmonger D (unpublished), “HouseholdProduction”, International Encyclopedia of Social & Behavioural Sciences.

14 Ibid.


(c) The production of housing services for own final consumption by owner occupiers;

(d) The production of domestic and personal services by paid domestic staff;

Outside the SNA production boundary:

(e) The production of domestic and personal services for consumption within the same, or other,households by other than paid staff: the preparation of meals, care and training of children, cleaning,repairs, etc.

The final category (e) defines the scope of activities within the household sector that will be included in themeasure of unpaid household work. To this is added a further category:

(f) The value of unpaid work for NPISHs.

Although in the SNA accounting structure, category (f) will add to the value of the production of NPISHsand not to household production, it nevertheless falls within the scope of unpaid work in this report.15

Figure 3Production boundary

Adapted from: Hawrylyshyn 1977, as shown in Ruuskanen O (1995) Options for Building aSatellite Account for the Measurement of Household Production.

Householdproduction

Market-based economic activity

All human activity

Economic activity

Summarising further:

• A full measure of household production would include activities (a) to (e) which are productiveactivities undertaken by households.

• The focus of this report is on the unpaid work of households not already included in the NZSNA. Inprinciple, this includes activities (e) and (f) only. In practise, however, some of (b) is included in themeasure of unpaid work in this report, namely, the household goods production that is not consideredsignificant enough to warrant inclusion in the NZSNA (e.g. household growing of vegetables andweaving).

3.3 The SNA production boundaryWhy does the SNA exclude these service activities from production? While acknowledging that all of theseactivities are productive in an economic sense, a number of reasons are given for their omission, including:

1. Services are consumed immediately, so the decision to produce a service is also a decision to consumeit. This makes the production of a service for own consumption a kind of self-contained activity,with limited impact on the rest of the economy. This is not the case with the production of goodswhere the decision to produce and consume can be separate.

15 Both contribute to an increase in household income: (e) generates mixed income ‘received’ by the household unit producing theservices, and (f) adds to the labour compensation of the household by the amount of the imputation for unpaid volunteers.


2. These types of services are difficult to measure and, in particular, to value, as the majority are notproduced in the market and there are no suitable prices by which they can be valued.

3. Even if values could be imputed, they would differ fundamentally from real monetary values. Inclusionin the SNA is not simply a matter of estimating monetary values for the outputs of these activities.The SNA is an integrated system, and if values are assigned to the outputs, similar values have alsoto be assigned to the incomes generated by their production and to the consumption of the output. Itis clear that the economic significance of these flows is very different from that of monetary flows.For example, the incomes generated are automatically tied to the consumption of the goods andservices produced, whereas if real income were earned from these activities, it would be spent indifferent ways. Consequently, these imputations have little relevance for the analysis of inflation,deflation or other disequilibria within the economy. The inclusion of large non-monetary flows ofthis kind in the accounts, together with monetary flows, can obscure what is happening in marketsand reduce the analytical usefulness of the data.

This last point is the key reason, namely, that including household services would distort and complicate theuse of national accounts for most analytical and policy purposes. Since the SNA is a multi-purpose system,it is “designed to meet a wide range of .... needs. A balance has to be struck between the desire for theaccounts to be as comprehensive as possible and the need to prevent flows used for the analysis of marketbehaviour and disequilibria from being swamped by non-monetary values. The System therefore includesall production of goods for own use within its production boundary, as goods can be switched betweenmarket and non-market use even after they have been produced, but it excludes all production of servicesfor own final consumption within households (except for the services produced by employing paid domesticstaff and the own-account production of housing services by owner occupiers). These services are consumedas they are produced and the links between their production and market activities are more tenuous than forgoods production, such as agricultural goods which households may produce partly for own final consumptionand partly for sale, or barter, on the market. The location of the production boundary in the System is acompromise, but a deliberate one that takes account of the needs of most users”.16

The SNA93 has also justified this decision by arguing that in the case of labour force statistics “economicallyactive persons are defined as those engaged in productive activities as defined in the SNA. If the productionboundary were extended to include the production of personal and domestic services by members ofhouseholds for their own final consumption, all persons engaged in such activities would become self-employed, making unemployment virtually impossible by definition. This illustrates the need to confine theproduction boundary in the SNA and other related statistical systems to market activities or fairly closesubstitutes for market activities”.17

A number of researchers have challenged these arguments. It is not proposed to detail these here18 otherthan to note that the critiques are mainly of two types: (i) those that point to bias and mismeasurement in theconventional measures and (ii) those that emphasise the interdependence between the household and marketeconomies and point out that the inclusion of household production would lead to more comprehensive andinformative analyses.

The latter can be illustrated by examining the different modes of production. Dr Duncan Ironmonger, anAustralian academic involved in the development of household accounts, has illustrated the relationshipbetween household and market production by looking at the options available to households for obtaininggoods and services.19 These can be bought in the market place (which is included in the SNA), or may beown-produced. To produce goods and services, two inputs, capital and labour, are generally required. In thefollowing example, it will be shown that by using a combination of these inputs, some are obtained from themarket and others are not. This leads to quite different valuations in the national accounts for what isessentially the same service. There are four combinations of these inputs and Ironmonger called these thefour modes of production. For this example, imagine that a person needs to get from their house to theairport. There are four ways that this person can get there:

16 System of National Accounts 1993, page 5, paragraph 1.22, emphasis added.17 System of National Accounts 1993, page 5, paragraph 1.22.18 Interested readers are referred to the Eurostat Proposal for a Satellite Account of Household Production and its bibliography19 Ironmonger D (1997), “National Accounts of Household Productive Activities”, paper prepared for the Time-Use, Non-Market

Work, and Family Well-being conference.


1. Taking a taxi (mode 1). This uses labour and capital from the market.

2. Hiring a driver to drive them in their own car (mode 2). This uses labour from the market and theirown capital.

3. Driving themselves in a hired car (mode 3). This uses their own labour and capital from the market.

4. Driving themselves in their own car (mode 4). This uses their own labour and capital.

Under the SNA, the full value of production is measured only where both market inputs are used (i.e. mode1). For modes 2 and 3 only market inputs are measured, while production under mode 4 is totally excluded.However, if we were able to show household production we would be in a better position to see the linksbetween the two economies. This idea becomes important when there is a switch between householdproduction and market production as explained earlier.

The SNA93 does not deny the importance of the household production of services. As noted above, itargues that the types of analyses proposed by those advocating a wider production boundary are betterundertaken outside the core accounts, as these have a well-established role and use, which may becompromised by the inclusion of significant non-monetary values. To this end, the SNA93 recommendstheir inclusion in a household satellite account.

3.4 Household satellite accountsSatellite accounts enable the existing SNA framework to be extended and provide the flexibility needed foralternative measurement and analyses. They are separate from, but conceptually consistent with, the corenational accounts. The main purpose of satellite accounts is to “expand the analytical capacity of nationalaccounting for selected areas of social concern, without overburdening or disrupting the central system”.20

A number of statistical agencies around the world have begun to use this satellite account concept for areassuch as household production, tourism’s contribution to the economy, research and development, and theenvironmental effects of production.

There are two types of satellite accounts mentioned in SNA93. The first may rearrange central classificationsand introduce complementary elements that differ from the conceptual central framework. However, indoing this it does not drastically alter the existing conceptual central framework.21 For example, tourismsatellite accounts concentrate on the tourism industry to gain better knowledge and statistics on the contributionit makes to the economy. The second type is based on alternative concepts to the SNA. An example of thistype would be a household satellite account, which, among other things, would extend the existing SNAproduction boundary to include household production.22

Figure 4Modes of production

Market production

Household production

Market production

Mode 1 Mode 2

Household production

Mode 3 Mode 4

Source: Ironmonger D (1997) National Accounts of Household Productive Activities.

Capital used

Labour used

20 System of National Accounts 1993, page 489, paragraph 21.4.21 System of National Accounts 1993, page 493, paragraph 21.45.22 System of National Accounts 1993, page 493, paragraph 21.46.


Household satellite accounts bring together all household activities, whether already included in the SNA ornot. By presenting a more comprehensive picture of household activity, the satellite account provides atruer measure of the size of the household sector and the interdependencies with other sectors of the economy.It also allows a more complete analysis of the economic changes occurring within, and between, householdsthemselves.

The purpose of the household satellite account described here23 is to provide an overall picture of the productiveactivities of households and to give them an economic value. As noted above, the household unit as definedin the existing national accounts is the appropriate unit of observation (the transactor). The scope of theaccount is all household productive activities, that is, those that satisfy the ‘market alternative criterion’ (or,as it is more familiarly known, the ‘third party criterion’). The actual household activities that satisfy thecriterion are detailed in the next section.

3.5 Unpaid work for non-profit institutionsIn the national accounts, five separate institutional sectors are identified: non-financial corporations, financialcorporations, general government, NPISHs and households. As the satellite account adopts SNA sectoring,household production of goods and services should be strictly confined to that which is organised andmanaged by the household. Therefore, the unpaid work that households do for NPISHs (e.g. sports club,New Zealand Red Cross, Girl Guides Association) would not be included in household production. Rather,it would be included in a satellite account for the NPISHs sector, which is where the production is organisedand where the volunteer labour is combined with other inputs to produce a range of non-marketed services.What would be recorded in the household satellite account is a ‘donation’ of time to the NPISH, which then‘pays’ the household for that volunteer work. Accordingly, the augmented measure of household income inthe satellite account would include the value of volunteer work. In other words, household income in thesatellite account would include both imputed income from household production and imputed income fromvolunteer work. In this report, the focus is on placing a value on all unpaid work performed by householders,regardless of whether this gives rise to household products or non-household products. Accordingly, volunteerwork is included in all output tables.

A fully compiled household satellite account would also include those household activities which are currentlyincluded in the core national accounts, namely the imputed housing services resulting from owning yourown home, and the production resulting from private households employing staff.

The scope of the household satellite account is shown in Figure 5.

Figure 5Scope of the satellite account of household production

Adapted from: Eurostat (1999), Proposal for a Satellite Account of Household Production.

Volunteer production of services for other households

Household production for own useMarket production (i.e. imputed housing services by owner occupiers)

Volunteer production of goods Production of:

-goods -private households employing domestic staff

Production of all other services (i.e. all household production of services for own use, excluding imputed housing services by owner occupiers and private households employing domestic staff)

Satellite account of household productionSNA production Non-SNA production

23 The content of satellite accounts is largely shaped by the purpose for which they are drawn up. For example, a household satelliteaccount concerned with examining an alternative classification of taxes and subsidies would adopt different concepts and definitionsto those proposed here.


3.6 Accounting for household productionThe key purpose of the household satellite account is to measure the value of household production andincomes generated. The satellite account recognises that the household as a consumer also has the role of aproducer. The approach adopted is similar to any other producer in the core accounts, namely to compile aproduction account which identifies the value of the gross output from household production and the costsof producing that output. Effectively, “households may be regarded as enterprises in which goods andservices are produced by household members, who also consume the bulk of the goods and servicesproduced”.24

In order to compile the production account, transactions currently found in the core accounts are reclassified.These core accounts have been drawn up from the perspective of the household as a consuming unit and anypurchases connected with household services, such as washing powder used for ‘cleaning services’, areclassified to household final consumption expenditure. Extending the production boundary and recognisingthe household as a producer of these services, changes the classification of the related purchases. In theexample, washing powder is now a raw material input to the production process and is classified to intermediateconsumption, not final consumption. What will now be included in household final consumption expenditureis the purchase of the ‘cleaning service’, which will be valued inclusive of all costs, not just the materialsused up. Clearly, the major addition to the cost will be the imputed value for unpaid labour.

The production account could be constructed as follows:

The residual item, mixed income, measures the imputed income from household production. It represents the(unpaid) compensation to household labour and the return on household durables (capital) used in production.

Gross value added, the addition to GDP, is measured as the value of output after the cost of bought-inmaterials and services (intermediate consumption) has been deducted.

Transactions currently found in the core accounts have been reclassified:

(a) the goods and services included in household final consumption expenditure are split depending ontheir use in the production process

(i) non-durable goods and services used up in production are classified as intermediate consumption

(ii) durable goods are classified as capital purchases

(iii) other non-durable goods and services that are not inputs to production are unchanged

24 Eurostat (1999), Proposal for a Satellite Account of Household Production, page 20.

Figure 6Household production account

Uses ResourcesIntermediate consumption Gross output(non-durable goods and services acquired by households that are used up in household production)

(value of all household goods and services produced)

Wages paid to domestic staff(actual wages to paid employees)Consumption of fixed capital(depreciation of household durables used in the household production process)Taxes (less subsidies) on production(transfer payments made by/received by households to/from government)Mixed income(residual)Total uses Total resources


(b) Household durable goods are now classified as fixed assets which provide a flow of services over anumber of years. Consumption of fixed capital measures the loss in value of the asset due to its usein production.

(c) Taxes (less subsidies) on production will include a number of minor taxes which households currentlypay for the use of certain durable goods, such as motor vehicles.

The gross value of household production will be included in household final consumption expenditure.

The effect of the inclusion of household production, and the resulting reclassifications, on the key aggregatesfound in the core gross domestic product and expenditure accounts presentation, is given in the figurebelow.

Figure 7Changes in aggregates between

household satellite accounts and core national accountsAggregate Change between household satellite account

and core national accounts.Expenditure on GDPHousehold final consumption expenditure Increased by households' non-market gross

output that is additional to that already recorded in the national accounts.Decreased by (a) expenditure on goods and services reclassified as intermediate consumption and (b) expenditure on durables reclassified as gross fixed capital formation.

Gross fixed capital formation Increased by the expenditure on household durables reclassified from household final consumption expenditure.

Income measure of GDPMixed income This would be a new entry in the NZSNA. It is

similar to operating surplus and measures the surplus originating from household production.

Consumption of fixed capital Increased by the consumption of fixed capital relating to household durables reclassified from household final consumption expenditure.

Taxes less subsidies on production and imports

Increased by transfer payments such as vehicle licence fees reclassified from secondary income in the income and outlay account to taxes on production in the household production account.

GDP Increased by households' non-market gross value added that is additional to that already recorded in the national accounts.

Adapted from: Australian Bureau of Statistics (2000) Unpaid Work and the Australian Economy 1997 , Canberra.


3.7 Going beyond the production accountThe household satellite account described so far has focused on developing a production account in order toidentify and measure household production and, hence, unpaid work. Its compilation has been dependenton making three key modifications to the core SNA framework:

(a) the production boundary has been expanded to include non-marketed household services producedfor own consumption

(b) the value of unpaid labour has been imputed and

(c) the concepts of consumption and capital formation have been modified

The actual data presented in any production account tables would be significantly more detailed than suggestedby the pro-forma account given above. In line with the Eurostat proposals, production would be disaggregatedby type of household activity and the core outputs and satellite account extensions separately shown. Inaddition, depending on the available data, the account could be further cross-classified by type of household.25

While deriving the value of household production is central to any comprehensive analysis of the householdand market economies, it can be seen as the starting point for other accounts within a satellite accountsystem. As the Eurostat guidelines point out, “the changes made to the production account necessitatecorresponding changes in other accounts in the system. These changes are most clearly reflected in theaccounts for consumption, disposable income and wealth”.26 It is not proposed to detail these other accountshere, as the focus of this report is on measuring unpaid work. It is simply noted that the usefulness of thesatellite accounts is increased by the additional information contained in the sequence of related householdaccounts, each focusing on a different key economic process.

25 Ironmonger has proposed that a satellite account for household production should be presented in the form of an input-outputtable in order to comprehensively analyse household economic activity. This would show for each of the key outputs of householdproduction a breakdown of the labour, capital and intermediate inputs used in their production. Both household and non-householdproduction of these outputs would be shown – refer Modes of Production, in section 3.3 – in order to explicitly show therelationships between the market and household economies and how these might change over time. He also envisages that dataon volumes of household outputs and time spent producing and consuming these outputs be used to supplement the tables.

26 Eurostat (1999), Proposal for a Satellite Account of Household Production, page 47.



4. Measuring household production4.1 What household activities are included in unpaid work?It was noted in the previous section that the distinction between productive and non-productive activities isbased on the ‘market alternative criterion’.27 Accordingly, an activity is defined as productive if it is possibleto have someone else to do it for you. For example, you could pay someone to cook a meal for you, but youcould not pay someone to eat the meal for you (and still derive benefit). While this criterion is largelyaccepted internationally and has the virtue of simplicity, implementing it is not, and there continues to bemuch debate concerning which household activities can legitimately be classified as ‘productive’ in thisnarrower economic sense.

For example:

• In order to distinguish between productive activities and personal care, it is necessary to makereference to “normal social practice and standards. For instance bathing a child or dressing a disabledperson will be classified as ‘housework’ whereas washing and dressing oneself will not be consideredas productive activities, on the grounds that they conform to normal adult behaviour”.28

• Only the productive part of an activity is relevant for measurement. For instance, while making abirthday cake for a child can be seen as a personal activity - with personal value - only the productiveactivity of baking the cake - an item which can be purchased - is valued.

• Some joint activities have elements that are both productive and non-productive. For example,walking the dog is undertaken for both personal exercise (unproductive) and exercise for the dog(productive, as another person could be delegated to do this). In this case, joint activities whichhave an element of productive activity are included.

• Self-education has proven particularly contentious, given its economic implications. Although itmay be considered ‘productive’ in one sense, as it is not possible to delegate the task, it is excluded.

• The classification of travel is also not clear-cut. Clearly, it is not possible to delegate personaltravel, such as riding in a bus from home to work, to a third party. However, the view is taken thattravel is a necessary component of another activity and so has been classified according to thepurpose of the trip. Travel for shopping is productive, but trips to a restaurant or sports events areclassified as leisure and non-productive. Travel to work is less clear-cut. Work, by definition, isproductive, and therefore travel to work, by definition, is also productive. However, time spenttravelling to work is often not specifically remunerated; so, should unremunerated travel to work beincluded in the unpaid work estimates? For this report it has not been included. Travel to work istaken to be an integral part of the market work activity and no separate valuation is warranted. Itcould be argued that the cost of travel time is implicitly factored into the value of paid work. (Tosome extent, the issues concerning the classification of travel arise due to capturing time episodes inexcessive detail. For example, the time spent gardening is not broken down into finer componentssuch as ‘walk to implement shed’, ‘walk to garden plot’ and ‘dig garden’. All these activities areseen as an integral part of a single activity ‘gardening’. In the same way, ‘shopping’ includes thetime to travel to the shops, ‘providing care for another household’ the time to travel to the neighbour’shome and so on. In the same way, time spent in ‘market work’ includes the travel time to work.)

With many of these boundary cases, some may regard them as work and others as leisure. However, thissubjective perception is not relevant for the economic classification being adopted. The only relevant factoris whether or not the activity can be delegated to a third party.

27 “An activity shall be deemed productive if it is of such a character that it might be obtained by hiring a worker or by rentingcapital equipment in the market.” Ironmonger D (unpublished), Household Production prepared for the 2001 issue of theInternational Encyclopedia of Social & Behavioural Sciences.

28 Chadeau, (1992) quoted in Eurostat (1999), Proposal for a Satellite Account of Household Production, page 22.


On the basis of this criterion, it is possible to partition all household activities into a number of mutuallyexclusive classes. These are shown in Figure 8 with examples. The hours in the week entries are from the1999 Time Use Survey and are the weekly average across all households for persons 15 years and over. Itcan be seen that for the average household, 16.4 percent of total available weekly hours are spent on unpaidproductive activities, compared with 14.0 percent on market work. By far the largest proportion of time(69.5 percent) is classified as non-productive, being made up of personal care, sleeping and leisure activitiesthat do not meet the ‘third party criterion’.

Figure 8All activities

The scope of this report is that household production not already measured, in practise, in the New ZealandSystem of National Accounts. To clarify the scope of unpaid work valuations included in this report, it isuseful to overlay the analysis of household activities presented above with the earlier Figure 5, whichillustrated the scope of household production. The SNA production boundary embraces all market activities,plus those unpaid activities concerned with the production of goods. In terms of Figure 8, this means thatthe unpaid work valuations contained should cover only those unpaid work activities concerned with producingservices either ‘for households’ or ‘formal work outside the household’. In principle, those unpaid activitiesconcerned with goods production are included in the existing national accounts and should be excludedfrom the unpaid work estimates included here. In practice, only an estimate for agricultural products isincluded in the New Zealand System of National Accounts and, in terms of the Time Use Surveyclassifications, it is probable that time spent on this production would have been classified as a marketactivity (i.e. the estimate is intended to allow for own consumption of farm products intended for sale.) Inaddition, the unpaid work estimate will include some own-account goods production which conceptuallyfalls within the SNA production boundary, but is not, in practice, measured (e.g. household growing ofvegetables and weaving). Consequently, as the table and all subsequent valuations are based on the TimeUse Survey classifications, valuing all Time Use Survey activities coded to unpaid work is unlikely todouble count any goods production already included in the national accounts.

Type of Total

activity: Productive Non-productive all activities

Market workFor Formal work

households outside the household

Examples: Call centre operator Food preparation Scout leader SleepingClerical staff Shopping for household

groceriesVolunteer for NZ Red Cross

Eating and drinking

Farmer Looking after your own child

Secretary for local rugby club

Homework

Government employee Driving your elderly neighbour to the bank

Cleaning your teeth

Professional sports person

Repairing your couch Having a shower

Medical professional Washing dishes Brushing your hairTaxi driver Ironing clothes Playing sportTeacher Vehicle maintenance Watching television

Cleaning the garage Going to the moviesPaying the billsCleaning the dogGardening

Hours ina week:Percentageof total (%)

Note: Totals may not add due to rounding

14.0

Unpaid work

116.8 168.025.9 1.7

All activities

23.6

100.069.51.015.4


4.2 Classifying unpaid work activitiesJust as market production is disaggregated by industry for further analysis, a similar breakdown can beadopted for non-market household production. The aim is to classify unpaid work activities into analyticallyuseful groupings. The schema adopted here follows that outlined in the recent Eurostat working paper.

The Eurostat proposal notes that the services produced in households for own use are primarily intended tosatisfy basic needs, namely provide shelter, food, clothing and personal/family care, all of which are neededfor physical existence. Every household provides these, either through own production or by purchasing inthe market. Accordingly, it identifies four principal functions associated with unpaid work inside thehousehold:

• providing housing

• providing nutrition

• providing clothing

• providing care and education

In addition, as noted earlier, households undertake unpaid activities for other households and the community,which, while not essential for the well-being of the producing household, are nevertheless important forhouseholds in general. A fifth principal function, unpaid work outside the household, is therefore identified.

In order to perform these functions, households undertake a number of related ancillary activities. Cleaning,for example, is an ancillary service to the provision of housing; shopping for food to the provision ofnutrition. Again, this type of analysis parallels that used for market production. In the national accounts,ancillary activities are those “supporting activities undertaken within an enterprise in order to create conditionswithin which the principal and secondary activities can be carried out”.29 So, in the national accounts, themeasurement of manufacturing production, for example, will include the costs associated with ancillaryactivities such as buying raw materials, repairs and maintenance of machinery, cleaning and book-keeping.In the same way, the productive activities of households can be classified either to the principal function oras an ancillary to it. This is shown in Figure 9.

Figure 9 illustrates the schema adopted in the tables in this report. In the tables, the category ‘unpaid workoutside the household’, has been further split into informal unpaid work (e.g. care for children in otherhouseholds), and formal unpaid work (e.g. providing assistance to non-profit institutions). This allows theseparate identification of the unpaid work for NPISHs which, as noted earlier, in the context of a full householdsatellite account, would be included as part of the production of NPISHs. However, it still contributes to thevaluation of the unpaid work not recorded in the national accounts and is included in all tables in the report.

Appendix 2 details which Time Use Survey codes are classified to which activity. The time use activitycodes used in the Time Use Survey did not always align with the above classifications. In some cases, timeuse activity codes had to be split. These may have been within functions (i.e. between principal and ancillaryactivities) or across functions. For example:

• code 0410 ‘food or drink preparation and cleanup not further defined (nfd)’ had to be split over thenutrition principal activity and ancillary activity of cleaning. As no information was available tomake an accurate split, a degree of judgement had to be used to split such codes; and

• code 0451 ‘household administration’ had to be split across the housing, nutrition, clothing and carefunctions.

29 System of National Accounts 1993, page 147, paragraph 5.8.


Figure 9Unpaid work activities and the principal functions of household production

Providing housing

Providing nutrition

Providing clothing

Providingcare

Informalunpaid work

Formalunpaid work

Outputs Accommodation for members of the household

Meals, snacks, drinks for members of the household

Clothes and their care for members of the household

Care services to children, the sick, the elderly, and pets inside the household

Care services to children, the sick, the elderly, and pets outside the household

Goods and services for other institutions

Principal activities

House construction and renovation

Food preparation, meals and snacks, baking

Producing textiles, handicrafts

Physical care, supervision, reading or playing, teaching the child, accompanying the child, adult care, pet care

Informal help for children, adults, and pets

Organisational work, caring for people via a voluntary service organisation, environmental and animal protection

Ancillary activities

Shopping Buying a dwelling, renting a dwelling, buying furniture, carpets and equipment for dwelling, buying household textiles

Shopping for groceries, and appliances for: cooking; cooling; freezing and storing food

Shopping for: clothing materials; garments; shoes

Shopping for: toys; books; baby carriages; strollers

Maintenance Repairs to dwelling, repairing equipment, furniture and household goods, heating and water, various arrangements

Care of clothes and shoes

Care of pets, walking dog

Gardening Tending ornamental plants

Tending edible plants, tending domestic animals

Cleaning Cleaning dwelling, cellar, garage, yard

Dish washing Laundry, ironing

Transport Travel related to household care, vehicle maintenance

Travel related to nutrition shopping and services

Travel related to clothing shopping and services

Travel related to childcare, adult care of own household

Travel related to childcare, adult care of other households

Travel related to formal unpaid work

Management Paying bills, decision making

Food management e.g. planning meals, groceries

Planning and decision-making

Coordinating children's activities

Adapted from: Eurostat (1999) Proposal for a Satellite Account of Household Production.

Unpaid work outside the householdUnpaid work inside the household


In the first example, the value of the principal function will be unchanged; only the split between the principaland ancillary activities will change. In the second example, the split affects the valuation placed acrossfunctions.

The classification issues discussed above all relate to splitting productive activities and the decisions do notaffect the total time spent on unpaid work. This is not the case with those activities which may contain acomponent which is non-productive. However, the only activity which may contribute to an over-statementof time in unpaid work is shopping. While there may be a recreational component to gardening, for example,this single activity contributes toward maintaining the value of the house. The fact that some people maygain a physical or spiritual benefit from the activity is not relevant here. However, in the case of shopping,there may be a component which is purely recreational - such as window-gazing, having a cup of coffee -and strictly speaking this component should be excluded. However, this has not been done and all Time UseSurvey activity codes have been classified in total as either productive or non-productive.

For more information on how the Time Use Survey activity codes have been classified, see Appendix 2.

4.3 Valuing household productionThere are essentially two methods for valuing non-marketed household production, and deriving an estimateof the value added from unpaid work; the output approach and the input approach. This section looks ateach of these approaches in turn. More information on the terminology can be found in Appendix 4.

Output approachWith this approach, a full production account is created for the household (see Figure 10 below). The valueadded from household production is derived by deducting the cost of purchased goods and services from thevalue of outputs, with the outputs being valued at market equivalent prices. This can be further brokendown to derive a residual, ‘mixed income’, a single figure which measures the compensation or earnings ofthe labour and capital employed to produce the service.

This is the approach recommended by Eurostat and offers several advantages over other approaches:

• it is consistent with general national accounting recommended practice

• it avoids the need to find an appropriate household labour wage

• it avoids the need to consider the treatment of simultaneous activities (discussed later in this section)and

• it avoids the issue of variability in the quantity and quality of goods and services produced (as eachis, in theory, identified as a different product and the method measures the quantum of each product.)

The main draw-back is that few countries collect information on the quantity of household outputs.30 Also,there are no market counterparts for many household services, hence, even assuming volume measurescould be obtained, appropriate market prices may not be available.

30 The Office for National Statistics is in the process of investigating data sources with the potential to provide information onhousehold outputs. Short, S (2000) Time Use Data in the Household Satellite Account, ONS.


Figure 10Output-based method for deriving value added

Input approachThe input approach also results in drawing up a full household production account (see Figure 11), but thevalue added for household production is derived from the value of the inputs (rather than the value ofoutputs) with the labour input component being valued at market equivalent prices. This approach is consistentwith that used to value the non-market output of government and NPISHs in the national accounts. Whilethis method has the advantage that it does result in establishing an estimate of total production and valueadded, because it is based on input measures it suffers from a number of limitations:

• valuations can differ widely depending on the wage rate chosen

• no allowance is made for the return on capital employed

• the treatment of simultaneous activities pose problems

• the quantity and quality of production may differ between households (because the quantity ofoutputs is unknown)

• efficiency comparisons with market producers of similar goods and services cannot be made due tothe absence of an output measure which is independent to the measure of inputs

Total output Value of all the goods and services produced (measured by quantity multiplied by price).

Less intermediate consumption Non-durable goods and services acquired by households that are used up in household production.

Equals value added The value of output after the cost of bought-in materials and services has been deducted.

Less wages paid to domestic staff

Less consumption of fixed capital Depreciation of household durables used in the household production process.

Less taxes on production Transfer payments made by households to government.

Plus subsidies on production Transfer payments made by government to households.

Equals mixed income Residual which includes compensation of labour and capital for households.

Adapted from: Eurostat (1999) Proposal for a Satellite Account of Household Production and the Australian Bureau of Statistics (2000) Unpaid Work and the Australian Economy 1997 , Canberra.


This approach tends to be more common internationally because the information required is more readilyavailable.

Figure 11Input-based method for deriving value added

31 Fitzgerald J and Wicks J (1990) “Measuring the Value of Household Output: A Comparison of Direct and Indirect Approaches”,The Review of Income and Wealth, Vol 36, No. 2, June 1990.

Value of labour The labour value component of unpaid work.

Plus wages paid to domestic staff

Plus taxes on production Transfer payments made by households to government.

Less subsidies on production Transfer payments made by government to households.

Equals net value added The value of output after the cost of bought-in materials and services has been deducted and excluding consumption of fixed capital.

Plus consumption of fixed capital Depreciation of household durables used in the household production process.

Equals gross value added The value of output after the cost of bought-in materials and services has been deducted, but including consumption of fixed capital.

Plus intermediate consumption Non-durable goods and services acquired by households that are used up in household production.

Equals total output Value of all the goods and services produced.

Adapted from: Eurostat (1999) Proposal for a Satellite Account of Household Production and the Australian Bureau of Statistics (2000) Unpaid Work and the Australian Economy 1997 , Canberra.

Clearly, both the value of production and value added will differ depending on the approach adopted, withthe major difference being the omission of any return to capital in the input approach. There are fewinternational studies using the output approach because few countries collect the required data. One suchstudy31 has found that for the range of household outputs identified, their value using the output approachwas almost twice that obtained using the input approach.

Approach used in this reportThis report does not attempt to place a value on the gross output of household non-market production.Valuation is restricted to obtaining an estimate of the net value added resulting from unpaid work and this islimited to the imputed labour value. This has been termed the ‘net approach’ and can be thought of as asubset of the input approach in that only the labour component of household productive activities is measured.This results in an adequate proxy for net value added, as illustrated in the input based approach. Theomitted transactions (wages to domestic staff, taxes less subsidies on production) will not be significant inthe New Zealand context.

This net approach also suffers from the same limitations as the input approach in relation to the choice ofwage rate, consideration of treatment for secondary activities, and how quantity and quality of productiondiffers between households. The major advantage of this approach is that it is relatively simple to apply, andthis simplicity means that this approach has been adopted as a starting point for countries in valuing unpaidwork - including New Zealand.


Figure 12Net-based method for deriving value added

Value of labour The labour value component of unpaid work.Equals net value added The value of output after the cost of bought-

in materials and services has been deducted and excluding consumption of fixed capital.

Adapted from: Australian Bureau of Statistics (2000) Unpaid Work and the Australian Economy 1997 , Canberra.

4.4 Valuing unpaid workThe estimate of the value of unpaid labour services is calculated as the product of (a) the number of hoursspent on unpaid household activities by persons aged 15 years and over; and (b) an appropriate hourly wagerate.

Hours workedAn essential prerequisite for the measurement of unpaid work using the input approach is the availability ofinformation on how people spend their time. For this, a time use survey is needed. In August 1990, the thenDepartment of Statistics conducted a pilot time use survey, and information from this was used to exploreoptions for valuing unpaid work in New Zealand. Although the survey was only a pilot, tentative valuationestimates were produced.32 It was not until 1998/1999 that the first national time use survey was conductedfor New Zealand. Appendix 1 contains more information about the 1999 Time Use Survey.

Population coverageThe population definition for the Time Use Survey was all persons aged 12+ living in private dwellings.However, for the purpose of this report, the population coverage has been restricted to those aged 15+. Themain advantages of this restriction are that this is the same age limit that applies to labour force and incomesurveys, and it is the age group commonly used by other countries in their time use surveys (notably Australia).An additional advantage is that it avoids distortion in certain activities. For example, participation in self-education could appear to be higher than expected due to the fact that students are required to be at schooluntil the age of 16.

Persons living in non-private dwellings (hotels, motor camps, student hostels, prisons etc.) are excludedfrom the Time Use Survey and hence from the hours worked totals. To this extent, the unpaid work estimatesundercount, although this exclusion will be relatively minor.

Primary and simultaneous activitiesAs indicated above, simultaneous activities can pose problems when using the input or net approachesbecause respondents can be engaged in more than one productive household activity at the same time. If theoutput approach was being used, this would not be an issue as the value of output would be based on theactual volumes of services produced. With the input approach, however, should only the primary activity bevalued or all activities? And if more than one activity is valued, is it assumed that the productivity for eachactivity is the same as if it was the sole activity, or is some allowance made for loss of efficiency?

32 Department of Statistics (1992) Options for the Valuation of Unpaid Work in New Zealand 1991, Department of Statistics,Wellington.


In the Time Use Survey, respondents recorded time episodes in a two-columned diary. These were coded toa four digit classification. Respondents could indicate participation in several activities at once, that is,simultaneous activities. For each time period (the rows), an entry was recorded in the first column (theprimary activity column). If other activities were being undertaken simultaneously, these were recorded inthe second column. This was done until all simultaneous activities had been accounted for. The Time UseSurvey data used in this report recognises the primary activity as that recorded in the first column as reportedby the respondents. This aligns with how the respondents themselves actually ranked (or at least reported)their time.33

In the Time Use Survey, the potential for the recording of simultaneous productive activities was significantlyincreased by the inclusion of an ‘available for care’ code. In New Zealand, an adult is legally required to bein charge of any child/children under the age of 14. In the Time Use Survey, respondents were askedwhether they were responsible for anyone, including children who could not be left alone. This time wascoded as ‘available for care’. As a consequence, there are a high number of hours in ‘simultaneous activitychildcare’ directly attributable to the ‘available for care’ code.

The capturing of simultaneous activities is illustrated in the following table. For simplicity, this has beenrestricted to the first two activities only, ‘primary’ and ‘secondary’.34

33 This method of assigning an activity as ‘primary’ differs from that used in the main 1999 Time Use Survey report, Around theClock (Statistics New Zealand, 2001) For the Around the Clock report, a system was developed to prioritise simultaneousactivities. The objective of this was to assign in a standard way, one activity as ‘primary’ within an episode where a respondentreported more than one activity. The rationale for this approach was that different respondents might not report on the same basiswhich simultaneous activity was ‘primary’.

34 Secondary activity in this report is defined as the first activity recorded in the second column in the Time Use Survey diary. Theidea of tabulating primary by secondary activities is attributed to Ironmonger, D (1996) “Bringing up Betty and Bobby: TheMacro Time Dimensions of Investment in the Care and Nurture of Children” in Investing in Children: Primary PreventionStrategies, edited by Smith, A. and Taylor, N. Children’s Issues Centre, University of Otago.


Table 10Primary by secondary activity

Average minutes per day per person

Primary activityNo

secondaryactivity

Housing Nutrition Clothing

Child-care

insidethe

house-hold

Non-childcare

insidethe

house-hold

Informalchildcareoutside

thehousehold

Informalnon-

childcareoutside

thehousehold

Formal unpaid work

outside the household

Housing 35 0 0 1 0 0 1 0 0Nutrition 30 1 0 0 1 0 1 0 0Clothing 13 0 0 0 0 0 0 0 0Childcare inside the household 17 1 1 0 1 0 1 0 0Non-childcare inside the household 7 0 0 0 0 0 0 0 0Informal childcare outside the household 1 0 0 0 0 0 0 0 0Informal non-childcare outside the household 7 0 0 0 0 0 0 0 0Formal unpaid work outside the household 10 0 0 0 0 0 0 0 0Market work 185 0 0 0 0 0 0 0 0Self education 28 0 0 0 0 0 0 0 0Sleeping 364 0 0 0 0 0 3 1 0Eating and drinking 27 0 0 0 1 0 1 0 0Personal care 31 0 0 0 0 0 0 0 0Recreation 163 2 3 1 2 0 3 1 0Not stated 1 0 0 0 0 0 0 0 0

Total 919 5 6 3 4 1 10 2 0

Table 10 - continued

Primary activityMarketwork

Selfeduca-

tionSleeping

Eatingand

drinking

Personalcare

Recrea-tion

Notstated

Avail-ablefor

care

Total


Total 1 1 4 30 3 169 0 282 1,440



• The rows in the table record the minutes per day per person spent on primary activities. The rowtotals are therefore the primary activity totals used in this report.

• The columns record the secondary activity that was occurring at the same time as the primary.

If all simultaneous activities are included in the valuation of unpaid work, then the total minutes spent on aproductive activity is the sum of both primary and secondary time. For example, 27 minutes were spent onthe clothing activity, the sum of 24 minutes (primary activity) and 3 minutes (secondary activity).

It can be seen that most secondary time activity was related to ‘available for care’ (as noted above), ‘recreation’and ‘eating and drinking’, all of which are classified as non-productive.

In this report, most tables use hours worked by primary activity only. However, as simultaneous activity willlegitimately result in the production of household services, valuation estimates including all relevantsimultaneous activities have also been provided. These valuations exclude the ‘available for care’ categoryin order to avoid over-estimating the true value of simultaneous activity. No attempt has been made toadjust the simultaneous activity hours to allow for any suspected loss of efficiency.

These estimates are provided in Table 11. Including simultaneous unpaid work activities has increased theestimate of unpaid work by 21 percent, from $39,637 million to $48,140 million.

Table 11Value of all time in unpaid work

Industries

Primary Other Total Primary Other Totalactivities simultaneous activities simultaneous

activities activities

Unpaid work inside the household -Housing 1,012 148 1,160 9,716 1,419 11,134 -Nutrition 1,063 165 1,229 10,209 1,588 11,797 -Clothing 355 88 444 3,410 849 4,259 -Care -Child 611 126 737 5,868 1,212 7,079 -Other 560 23 583 5,378 218 5,596Unpaid work outside the household -Informal -Child 84 277 362 810 2,661 3,472 -Other 195 45 241 1,875 435 2,310Unpaid work for households 3,882 873 4,755 37,266 8,382 45,648Formal unpaid work outside the household 247 13 260 2,370 122 2,493Total unpaid work 4,129 886 5,015 39,637 8,504 48,140


$(million)(million)Hours of unpaid work Value of unpaid work

The hourly wage rateValuing the labour component of unpaid work requires that a price of labour (wage rate) be borrowed fromthe market - but which one? While actual hours worked, analysed by activity, can be measured with someprecision, there is no agreed, unique market wage rate that should be used to value these hours. The choiceof the imputed wage rate has a significant bearing on the level of the unpaid work valuation and, indeed, isthe critical factor in any subsequent paid/unpaid work comparisons.

Options for an imputed wageThere are several options available for the choice of an imputed market wage, although these can be broadlygrouped into two categories depending on their underlying assumption, namely opportunity cost and marketreplacement cost:


1. Opportunity costIn this option, (paid) market work and (unpaid) household work trade off against one another. The assumptionis that time spent in one sphere is seen to be at the expense of time spent in the other. The wage rate used tovalue household work is therefore a person’s equivalent market wage, which is the income foregone throughopting to do unpaid household work. This option assumes a degree of choice for individuals in terms ofwhich sphere they spend time in, but, in reality, workers often have little choice about the number of hoursspent in paid work in particular. In addition, the use of an opportunity cost wage implies that differentpeople performing the same household task can be paid vastly different wage rates. Washing the dishes, forexample, is likely to require the same amount of skill whether the dishwasher is a labourer or a doctor, butone has a much higher wage rate than the other. An added complication arises for people who are notemployed, and therefore have no equivalent market wage. Because of these limitations, and the availabilityof preferable alternatives, the opportunity cost wage has largely been passed over as a means of valuinghousehold work.

2. Market replacement costThe assumption behind this approach is that households save money by deciding to perform the activitythemselves. The amount they save, and hence the value to the household of doing the work, is the cost ofpurchasing the same services in the market or hiring someone else to perform the activity. There are twovariants in this approach and each of these is discussed below:

(a) replacement cost individual functionWith this option, the wage rate varies according to the particular task being undertaken, as workers indifferent occupations would be assumed to undertake the different activities. For example, child-mindingactivities command a different wage rate to house maintenance activities, which are different again togardening services. Eurostat distinguishes two further options within this method: using the wage rates paidto specialised workers employed in market enterprises (e.g. the wages of a cook in a restaurant for foodpreparation activities) or the wage rates for specialised workers in the home (e.g. the wages paid to a gardeneremployed specifically for gardening tasks). The major problem with this variant is that the working conditionsand productivity of the replacement worker will, in all probability, vary significantly from those of theunpaid household worker. The market wage will not reflect time spent on simultaneous productive activitiesor leisure. From a practical perspective, it is unlikely that market replacements exist for all householdactivities to be valued.

(b) replacement cost general housekeeperIn this variation of replacement cost, the wage rate used is that of a general housekeeper. This approachappears to be the most appropriate given (i) working conditions will be similar for many activities, if not thesame, as those faced by the unpaid worker; and (ii) a general housekeeper is more likely to perform themajority of the tasks that are typically carried out in a household. Even so, there will still be a number ofhousehold productive tasks that a housekeeper would be unlikely to carry out and applying the single wagerate may lead to inappropriate valuations.

International experienceEurostat recommends using the housekeeper replacement wage and that is the option that has been used inthis report.

The Australian Bureau of Statistics supports the use of a hybrid of the two replacement cost variants. Thegeneral housekeeper wage is applied to those activities normally carried out by a housekeeper, while theindividual function replacement cost is used for the remainder. They state “[t]he hybrid approach wouldappear to be appropriate given that Australians typically hire housekeepers to clean house interiors, managelaundry and occasionally prepare meals, while they hire specialists to carry out child care, householdmaintenance and gardening tasks.”35

35 Australian Bureau of Statistics (2000), Unpaid Work and the Australian Economy 1997, Canberra, page 27.


Many countries produce alternative estimates using more than one or all of the above options, includingsub-variations such as different wage rates for males and females. As noted, this can result in widelydiffering estimates of the value of household production, notwithstanding the different sources of datawhich can also impact on final results. Chris Jackson, of Statistics Canada, found that “[a]mong the studieswith broad coverage of the population, estimates range from 25 percent to 70 percent of GDP or GNP [andt]he variation by valuation method is almost as great”.36

This finding confirms the results obtained in the earlier Department of Statistics study based on the 1990pilot time use survey, although the range then was not as wide. That study estimated that unpaid work variedfrom 43 percent of GDP (replacement cost general housekeeper) to 68 percent (opportunity cost, using theaverage weekly wage).37

Approach used in this reportAs noted above, the general housekeeper wage rate has been used in this report. This has been used for allactivities, including unpaid work outside the home. This wage rate may be inappropriate for many of theunpaid work activities performed for NPISHs, but given their relative importance, this will not seriouslybias the overall results. However, within the context of the NPISHs themselves, the contribution of thisunpaid work is quite significant, and more appropriate rates are needed to obtain a truer valuation of NPISHsactivities.

This report has used the general housekeeper wage rate extracted from the New Zealand Income Survey foroccupation group 512 ‘Housekeeping and Restaurant Service Workers’. For more information about theNew Zealand Income Survey, see Appendix 1. While the New Zealand Income Survey was not designed asan occupational earnings survey, it is the best source of occupational earnings data available in New Zealandand, in particular, it is the best source of information on housekeeper wages.

The wage rate used is a median, gross wage for the June Quarter 1999. The same rate has been used to valueall hours for all persons, regardless of age or sex. A median wage was chosen as opposed to an average,because average wages tend to be higher than median wages due to the influence of those with very highwages. Using the same wage rate for all hours has the advantage of making it easier to relate earnings tohours in the tables, and to compare results across different types of tables. However, if a different wage ratehad been chosen, then the resulting valuations would have been different.

36 Jackson, C (1996) National Studies of the Value of Unpaid Work: A Comparison of Methods, Norway, page 10.37 Department of Statistics (1992) Options for the Valuation of Unpaid Work in New Zealand 1991, Wellington.



5. Unpaid work analysed by statusof individual

The discussion and results presented so far have generally focussed on the household, rather than theindividual, as the unit of observation. As outlined earlier, a household satellite account would include thefull value of household production and associated costs. It would not be practical - or useful - to attempt tosplit this production and all associated costs among individuals within a household. For example, it wouldnot seem sensible to attempt to split the capital cost of a refrigerator among the activities performed by ahousehold’s female and male occupants.

Nevertheless, there is considerable interest in precisely this type of split in order to identify how thecontributions that individuals make to unpaid work in the household differ according to their personalcharacteristics and status. While the value of household production (and the associated value added) maynot lend itself easily to this type of analysis, this reservation does not apply to the unpaid work estimatescontained here, as these are based on the time use patterns of the individuals within each household. Apossible analogy can be drawn with a gender analysis of industry value added. Production is a joint processinvolving multiple inputs. It is not sensible to attempt to identify the share of production (and value added)that may be attributable to, say, female employees, as their input is combined with all other inputs to producea final, homogeneous product. It is, however, reasonable to measure the wages that were paid to the femaleemployees and to measure their hours of work. A similar process is undertaken in this section, whichcontains additional analyses of unpaid work by status of individual.

Two different table formats are used to analyse the average weekly hours in unpaid work for each categoryof individuals. The first shows the average weekly hours in all activities, both productive (including unpaidwork) and non-productive, while the second breaks the unpaid work component into principal and ancillaryactivities following the Eurostat guidelines explained earlier.

The focus of the tables is on the different time use patterns of individuals and all tables are presented in unitsof hours only. As the dollar valuations contained in this report use a single general housekeeper wage rate,dollar value tables would not add anything new.

Tables are provided for all persons, and then by gender, Mäori/non-Mäori, persons with/without childrenand for persons employed/not employed. When viewing the table data at this level of detail, it must beborne in mind that the Time Use Survey was a sample survey subject to both sample and non-sample error.The error margins will be higher as the level of disaggregation of the survey results increases. The problemof increasing error margins at higher levels of detail is complicated by the sheer number of possible activitiesthat respondents may enter into their Time Use Survey diary. In addition, participation in some activitiesoccupies very little time (such as feeding pets), while other activities are only performed by very few people.

More detailed information about time use can be found in Around the Clock38 - the main report from the1999 Time Use Survey. However, it should be noted that the results presented here will differ from those inthe main report due to factors such as:

• differences in population (age groups) coverage: the scope of the 1999 Time Use Survey is peopleaged 12 years and over; the scope of this report is people aged 15 years and over

• different activity groupings

• the inclusion of ancillary services in unpaid work estimates

• differences in the way simultaneous activities are defined

38 Statistics New Zealand (2001).


5.1 Unpaid work: all personsTable 12 shows how the average individual divides her/his time across the 168 hours available per week.The largest proportion of time (69.5 percent) is taken up by non-productive activities, largely due to theaverage of 58.8 hours per week spent asleep. Unpaid work took up 27.6 hours per week (16.4 percent),while market work accounted for the remaining 23.6 hours per week (14.0 percent). On average, more timeis spent in unpaid work than paid work. Note that Table 13 includes information previously shown in Table3. It is represented here because it forms the basis of the analysis by status of individual that follows.



Table 12Average weekly hours per person by activity

Activities Hours per week

Unpaid work Unpaid work inside the household -Housing 7.4 -Nutrition 7.8 -Clothing 2.8 -Care -Child 4.8 -Other 1.2 Unpaid work outside the household -Informal -Child 0.6 -Other 1.3 Unpaid work for households 26.0

Formal unpaid work outside the household 1.7Total unpaid work 27.6

Market work 23.6Self education 3.8Sleeping 58.8Eating and drinking 10.3Personal care 6.2Recreation 37.6Not stated 0.1

Total 168.0


Hours


Unpaid work

inside the house-

hold


Unpaid work for

households


Total unpaid work

Principal 0.3 2.9 0.1 3.9 7.3 1.5 8.8 1.4 10.2Ancillary Shopping 0.4 1.0 0.8 0.4 2.6 0.0 2.6 0.0 2.6

Maintenance 1.3 0.0 0.3 0.8 2.4 0.0 2.4 0.0 2.4Gardening 0.6 0.2 0.0 0.0 0.9 0.0 0.9 0.0 0.9Cleaning 3.8 2.8 1.1 0.0 7.7 0.0 7.7 0.0 7.7Transportation 0.9 0.6 0.5 0.9 2.9 0.5 3.4 0.2 3.6Management 0.2 0.2 0.0 0.0 0.5 0.0 0.5 0.0 0.5Total 7.4 7.8 2.8 6.1 24.1 1.9 26.0 1.7 27.6




An analysis of unpaid work activities (Table 13) shows that 87 percent of the work (i.e. 24.1 hours per week)benefits the individual or members of the same household, with the remaining 13 percent being approximatelyequally split between informal work for other households (1.9 hours per week) and more formal work forthe community (1.7 hours per week). Within the household, all principal functions account for sizeableclaims on time, with nutrition (all activities associated with the provision of food) being the largest, at 7.8hours per week, closely followed by housing, at 7.4 hours per week. Ancillary activities indicate that,across all functions, most time was spent cleaning (7.7 hours per week).

5.2 Unpaid work: female/maleTable 14 and 15 show that across all productive time activities, males and females had similar average hours(51.0 for females and 51.4 for males). However, the split between unpaid and paid (market) work was quitedifferent. Females average time in unpaid work was more than one-and-a-half times higher than males -34.5 hours compared with 20.3. Another way of looking at this is to note that for females only one-third(16.5 hours) of their total productive work occurred in the market and is therefore measured in conventionaleconomic statistics. The remaining two-thirds was unpaid and ‘hidden’. For males, the opposite was thecase: just under two-thirds (31.1 hours) of their productive time was in the market and one-third unpaid.

Table 15 shows that there were few activities (principal or ancillary) that were predominantly undertaken bymales. Conversely, females dominate certain activities. Time spent by females in the nutrition principalfunction was almost twice as high as males (10.0 hours against 5.4 hours). Females spent more time on care(particularly childcare) than males (7.9 hours against 4.1) and females spent nearly three times as much timeas males cleaning (11.2 hours against 3.9).

Table 14Average weekly hours per person by activity and gender

ActivitiesFemale Male

Unpaid work Unpaid work inside the household -Housing 8.6 6.2 -Nutrition 10.0 5.4 -Clothing 4.1 1.5 -Care -Child 6.5 3.1 -Other 1.4 1.1 Unpaid work outside the household -Informal -Child 0.8 0.3 -Other 1.4 1.2 Unpaid work for households 32.7 18.8

Formal unpaid work outside the household 1.8 1.5Total unpaid work 34.5 20.3

Market work 16.5 31.1Self education 3.6 4.0Sleeping 58.9 58.7Eating and drinking 10.4 10.2Personal care 6.7 5.8Recreation 37.2 37.9Not stated 0.1 0.1

Total 168.0 168.0


Hours per week


Table 15Average weekly unpaid work per person by

principal function, activity and gender

5.3 Unpaid work: Mäori/non-MäoriTables 16 and 17 indicate that there are few major differences in time use between Mäori and non-Mäori.Non-Mäori record marginally higher hours per week in productive time, largely due to higher hours ofmarket work (24.1 hours compared with 19.9 hours for Mäori). Conversely, Mäori record slightly higherhours of unpaid work than non-Mäori. The activity analysis shows Mäori spend more time than non-Mäorion care, particularly child-care, and also on unpaid work outside the household, helping other householdsand the community. The main contributors to these differences are likely to be the younger age structure ofthe Mäori population and, possibly, the greater involvement with whanau.

Hours

Activities Gender Housing Nutrition Clothing Care

Unpaid work

inside the house-

hold

Informal unpaid work

outside the

house-hold


Formal unpaid work

outside the

house-hold

Total unpaid work

Principal Female 0.1 3.9 0.2 5.3 9.5 1.7 11.2 1.6 12.8Male 0.5 2.0 0.0 2.4 4.9 1.2 6.1 1.3 7.4

Ancillary Shopping Female 0.5 1.3 0.9 0.5 3.2 0.0 3.2 0.0 3.2Male 0.3 0.8 0.6 0.3 1.9 0.0 1.9 0.0 1.9

Maintenance Female 1.0 0.0 0.5 0.8 2.2 0.0 2.2 0.0 2.2Male 1.6 0.0 0.1 0.8 2.5 0.0 2.5 0.0 2.5

Gardening Female 0.6 0.2 0.0 0.0 0.8 0.0 0.8 0.0 0.8Male 0.6 0.3 0.0 0.0 0.9 0.0 0.9 0.0 0.9

Cleaning Female 5.7 3.8 1.8 0.0 11.2 0.0 11.2 0.0 11.2Male 1.8 1.7 0.4 0.0 3.9 0.0 3.9 0.0 3.9

Transportation Female 0.6 0.7 0.5 1.2 3.0 0.4 3.4 0.2 3.7Male 1.3 0.5 0.4 0.6 2.8 0.4 3.2 0.2 3.4

Management Female 0.2 0.2 0.1 0.1 0.6 0.0 0.6 0.0 0.6Male 0.1 0.1 0.0 0.0 0.4 0.0 0.4 0.0 0.4

Total Female 8.6 10.0 4.1 7.9 30.6 2.1 32.7 1.8 34.5Male 6.2 5.4 1.5 4.1 17.3 1.6 18.9 1.5 20.3Total 7.4 7.8 2.8 6.1 24.1 1.9 26.0 1.7 27.6




Table 16Average weekly hours per person

by activity and ethnicityActivities

Mäori Non-Mäori




Total 168.0 168.0


Hours per week


by principal function, activity and ethnicity Hours

Activities Ethincity Housing Nutrition Clothing Care

Unpaid work inside

the house-

hold


outside the

house-hold


Formal unpaid work

outside the

house-hold

Total unpaid work

Principal Mäori 0.2 2.8 0.1 5.5 8.6 1.9 10.5 1.7 12.2Non-Mäori 0.3 2.9 0.2 3.7 7.1 1.4 8.5 1.4 9.9

Ancillary Shopping Mäori 0.4 1.0 0.7 0.4 2.5 0.0 2.5 0.0 2.5Non-Mäori 0.4 1.0 0.8 0.4 2.6 0.0 2.6 0.0 2.6

Maintenance Mäori 0.9 0.0 0.3 0.7 1.9 0.0 1.9 0.0 1.9Non-Mäori 1.3 0.0 0.3 0.8 2.4 0.0 2.4 0.0 2.4

Gardening Mäori 0.5 0.2 0.0 0.0 0.7 0.0 0.7 0.0 0.7Non-Mäori 0.6 0.2 0.0 0.0 0.9 0.0 0.9 0.0 0.9

Cleaning Mäori 3.8 2.6 1.2 0.0 7.6 0.0 7.6 0.0 7.6Non-Mäori 3.8 2.8 1.1 0.0 7.7 0.0 7.7 0.0 7.7

Transportation Mäori 0.7 0.6 0.5 1.0 2.8 0.5 3.3 0.2 3.6Non-Mäori 0.9 0.6 0.5 0.9 2.9 0.4 3.3 0.2 3.5

Management Mäori 0.1 0.1 0.0 0.0 0.3 0.0 0.3 0.0 0.3Non-Mäori 0.2 0.2 0.0 0.0 0.5 0.0 0.5 0.0 0.5

Total Mäori 6.6 7.3 2.8 7.6 24.4 2.4 26.8 1.9 28.7Non-Mäori 7.6 7.8 2.8 5.8 24.0 1.8 25.8 1.6 27.4Total 7.4 7.8 2.8 6.1 24.1 1.9 26.0 1.7 27.6




5.4 Unpaid work: persons in households with/without childrenAs might be expected, persons in households with children spend more time, on average, in productiveactivities, as Table 18 shows. Both unpaid work and market work are higher for households with children.This may reflect that prime working years generally coincide with prime child-raising years.

With more time expended on productive activities, persons in households with children have less time fornon-productive activities. In particular, these people have an average of 7.0 hours per week less to spend onrecreation than do persons in households without children.

The major difference in unpaid work activities appears, obviously, in childcare, which requires an additional6.9 hours per week in households with children. Interestingly, however, persons in households with childrenappear to spend less time, on average, in housing and nutrition (see Table 19). This may be partly related totime/money factors and partly related to economies of scale, with smaller households being less efficient athousehold production.

Table 18Average weekly hours per person

by activity and presence of childrenActivities

With children Without children




Total 168.0 168.0


Hours per week



by principal function, activity and presence of childrenHours

ActivitiesPresence of

childrenHousing Nutrition Clothing Care

Unpaid work inside

the house-

hold


outside the

house-hold


Formal unpaid work

outside the

house-hold

Total unpaid work

Principal With children 0.2 2.8 0.1 6.8 10.0 1.2 11.2 1.3 12.5Without children 0.4 3.1 0.2 0.4 4.0 1.8 5.8 1.6 7.4

Ancillary Shopping With children 0.4 1.0 0.8 0.4 2.6 0.0 2.6 0.0 2.6Without children 0.4 1.0 0.8 0.4 2.5 0.0 2.5 0.0 2.5

Maintenance With children 1.0 0.0 0.3 0.6 1.9 0.0 1.9 0.0 1.9Without children 1.6 0.0 0.3 1.1 3.0 0.0 3.0 0.0 3.0

Gardening With children 0.4 0.1 0.0 0.0 0.6 0.0 0.6 0.0 0.6Without children 0.8 0.4 0.0 0.0 1.2 0.0 1.2 0.0 1.2

Cleaning With children 3.8 2.7 1.2 0.0 7.7 0.0 7.7 0.0 7.7Without children 3.7 2.9 1.0 0.0 7.6 0.0 7.6 0.0 7.6

Transportation With children 0.9 0.6 0.5 1.4 3.3 0.5 3.8 0.2 4.0Without children 1.0 0.6 0.5 0.4 2.5 0.5 3.0 0.2 3.2

Management With children 0.2 0.2 0.0 0.0 0.4 0.0 0.4 0.0 0.4Without children 0.2 0.2 0.1 0.1 0.5 0.0 0.5 0.0 0.5

Total With children 6.9 7.4 2.9 9.2 26.4 1.7 28.1 1.5 29.6Without children 8.1 8.2 2.7 2.3 21.3 2.2 23.5 1.9 25.5Total 7.4 7.8 2.8 6.1 24.1 1.9 26.0 1.7 27.6




5.5 Unpaid work: persons employed/not employedNot surprisingly, persons in employment spend more time overall in productive time activities by virtue ofthe high average weekly hours they spend in market work. Total productive hours for persons in employmentis 61.5 hours, of which 22.6 hours is unpaid work and 38.9 hours is market work. This is in contrast topeople not employed, who work 35.5 productive hours per week, of which all but 0.2 hours is unpaid.39

Employed persons clearly have less time for non-productive activities and, most noticeably, have an averageof 16.1 hours less per week to spend on recreational activities.

The analysis of unpaid work activities (Table 21) shows that persons not in employment spend more time onall activities, principal and ancillary, than do persons employed. The most noticeable difference was in theancillary service of cleaning. Those without paid employment spent an average of 10.4 hours a week on thisactivity, compared with 5.8 hours for those in paid employment.

Table 20Average weekly hours per personby activity and employment status

ActivitiesEmployed Not employed




Total 168.0 168.0


Hours per week

39 For those aged 15 years and over, average weekly hours in market work from the Time Use Survey appear to be higher than thoserecorded in the Household Labour Force Survey (HLFS). Average actual weekly hours worked, as measured in the HLFS,equalled 35.1 for the year ended March 1999. Several factors may be responsible for this difference, including the fact that theTime Use Survey based estimates include travel to work time and time spent in work-related training activities not conductedduring work time. Other possibilities are that Time Use Survey respondents may have included lunch breaks when recording theirtime spent at work, and results may not be representative of a work week because respondents filled in a diary for two days ratherthan for a week.



by principal function, activity and employment statusHours

ActivitiesEmployment

statusHousing Nutrition Clothing Care

Unpaid work inside

the house-

hold


outside the

house-hold


Formal unpaid work

outside the

house-hold

Total unpaid work

Principal Employed 0.3 2.3 0.1 3.3 6.0 1.1 7.1 1.2 8.3Not employed 0.3 3.9 0.2 4.8 9.2 2.0 11.2 1.8 13.0

Ancillary Shopping Employed 0.3 0.9 0.7 0.3 2.2 0.0 2.2 0.0 2.2Not employed 0.5 1.2 0.9 0.5 3.0 0.0 3.0 0.0 3.0

Maintenance Employed 1.1 0.0 0.2 0.6 1.9 0.0 1.9 0.0 1.9Not employed 1.6 0.0 0.4 1.1 3.1 0.0 3.1 0.0 3.1

Gardening Employed 0.5 0.1 0.0 0.0 0.6 0.0 0.6 0.0 0.6Not employed 0.9 0.4 0.0 0.0 1.3 0.0 1.3 0.0 1.3

Cleaning Employed 2.8 2.1 0.9 0.0 5.8 0.0 5.8 0.0 5.8Not employed 5.2 3.7 1.5 0.0 10.4 0.0 10.4 0.0 10.4

Transportation Employed 0.9 0.6 0.4 0.9 2.7 0.4 3.1 0.2 3.3Not employed 1.0 0.7 0.5 1.0 3.2 0.5 3.7 0.2 4.0

Management Employed 0.2 0.2 0.0 0.0 0.4 0.0 0.4 0.0 0.4Not employed 0.2 0.2 0.1 0.1 0.5 0.0 0.5 0.0 0.5

Total Employed 6.1 6.2 2.3 5.1 19.7 1.5 21.2 1.4 22.6Not employed 9.6 10.2 3.6 7.5 30.8 2.4 33.2 2.1 35.3Total 7.4 7.8 2.8 6.1 24.1 1.9 26.0 1.7 27.6




5.6 Unpaid work: primary and secondary activity by genderTables 22 and 23 illustrate the differences in the occurrence of secondary activities between females andmales. (Refer section 4.4 for an explanation of the derivation of secondary activities). Females reportedmore time than males in secondary activities. Females spend an average of 45.4 hours per week on secondaryunpaid work activities, compared with 27.2 hours per week for males, although most of this difference isaccounted for by the ‘available for care’ category. If this is excluded, females spend an average of 4.8 hoursa week in secondary unpaid work activities, while males spend 2.3 hours.


Table 22Primary by secondary activity for female


Primary activity

No secon-dary

activity


Childcareinside

thehouse-

hold

Non-child care

inside the

house-hold

Informalchildcare outside

the house-

hold

Informal non-

childcare outside

the house-

hold

Formal unpaid work

outside the

house-hold


Total 831 6 7 4 7 1 12 3 1


Primary activityMarket work

Selfedu-

cationSleeping

Eatingand

drinking

Personalcare

Recrea-tion

Notstated

Avail-able for

care

Total


Total 1 1 5 29 3 180 0 348 1,440



Table 23Primary by secondary activity for male


Primary activity

No secon-dary

activity


Childcareinside

thehouse-

hold

Non-child care

inside the

house-hold

Informalchildcare outside

the house-

hold

Informal non-

childcare outside

the house-

hold

Formal unpaid work

outside the

house-hold

Housing 34 0 0 0 0 0 0 0 0Nutrition 24 1 0 0 0 0 0 0 0Clothing 8 0 0 0 0 0 0 0 0Childcare inside the household 11 0 0 0 0 0 0 0 0Non-childcare inside the household 6 0 0 0 0 0 0 0 0Informal childcare outside the household 1 0 0 0 0 0 0 0 0Informal non-childcare outside the household 8 0 0 0 0 0 0 0 0Formal unpaid work outside the household 10 0 0 0 0 0 0 0 0Market work 245 0 0 0 0 0 0 0 0Self education 30 0 0 0 0 0 0 0 0Sleeping 391 0 0 0 0 0 2 0 0Eating and drinking 31 0 0 0 0 0 1 0 0Personal care 31 0 0 0 0 0 0 0 0Recreation 180 1 2 0 1 0 2 1 0Not stated 1 0 0 0 0 0 0 0 0Total 1012 3 4 1 2 1 7 2 0


Primary activityMarket work

Selfedu-

cationSleeping

Eating and

drinking

Personalcare

Recrea-tion

Not stated

Avail-able for

care

Total

Housing 0 0 0 0 0 8 0 10 53

Nutrition 0 0 0 2 0 9 0 9 46

Clothing 0 0 0 0 0 2 0 2 13Childcare inside the household 0 0 2 1 0 6 0 4 26Non-childcare inside the household 0 0 0 0 0 1 0 1 9Informal childcare outside the household 0 0 0 0 0 1 0 1 3Informal non-childcare outside the household 0 0 0 0 0 2 0 1 11Formal unpaid work outside the household 0 0 0 0 0 1 0 1 13

Market work 0 0 0 1 0 12 0 6 266

Self education 0 0 0 0 0 2 0 1 34

Sleeping 0 0 0 0 0 1 0 108 503

Eating and drinking 0 0 0 0 0 42 0 13 87

Personal care 0 0 0 1 0 7 0 9 50

Recreation 0 1 0 24 1 64 0 46 325

Not stated 0 0 0 0 0 0 0 0 1

Total 1 1 4 30 2 157 0 213 1,440



Appendix 1:

About the surveysA1.1 The Time Use SurveyPurposeThe Ministry of Women’s Affairs commissioned the Time Use Survey to obtain accurate national estimatesof the population’s use of time. The overall objectives of the survey were:

• to measure the amount of time people aged 12 years and over spend on the main categories and sub-categories of activity

• to determine whether significant differences in time use exist among different population groups

• to determine the proportionate allocation of time to various activities

• to provide information on the context in which people undertake various activities and whether otheractivities are taking place simultaneously

• to provide data to improve significantly the estimates of the contribution to gross domestic product(GDP) of the domestic services of households industry and the employment component of thecontribution to GDP in the non-profit institutions serving households sector within the national accounts

• to provide time use data for New Zealand which is internationally comparable at a broad level of theactivity classification and which focuses on the four basic categories of contracted time, committedtime, necessary time and free time.

The Time Use Survey ran from July 1998 to June 1999. For more information regarding the Time UseSurvey, refer to Around the Clock (2001), Statistics New Zealand.

DesignSeven thousand two hundred households were selected into the Time Use Survey sample from the 752Household Economic Survey (HES) Primary Sampling Units (PSUs). An additional 150 screening PSUswere selected to ensure the sample had sufficient Mäori. Of these 150 screening PSUs, the 1996 Censusresults indicated that 2,087 households contained at least one Mäori aged 12 or over. This gave a totalexpected sample size of approximately 8,500 people. The achieved sample was, in fact, 8,522 individuals.

The survey population for the Time Use Survey was defined as the civilian, usually-resident, non-institutionalised population aged 12 years and over residing in private households. In addition, peopleliving on offshore islands (except Waiheke Island) were excluded. This is similar to the population definitionfor other SNZ household surveys.

The following people were thus excluded:

• long-term residents of old people’s homes, hospitals and psychiatric institutions

• inmates of penal institutions

• those living in other non-private dwellings

• members of the permanent armed forces

• overseas diplomats

• overseas visitors who expect to be usually resident in New Zealand for less than 12 months

• people living on offshore islands (except Waiheke Island).


MethodThe collection method was a combination of interview and self-administered questionnaire.

Respondents were interviewed continuously from July 1998 to June 1999. Respondents were asked to recordtheir activities over a 48-hour period in a diary. Interviewers then used a personal questionnaire to elicitfurther information about activities undertaken and other characteristics of the respondents. This approachwas adopted because of the level of detail required, such as who activities were done for, and whetherpeople were available for care of household members.

OutputStatistics New Zealand has produced, under contract to the Ministry of Women’s Affairs, 50 statisticaltables derived from the Time Use Survey dataset. Forty-seven of the 50 tables present data on averageminutes spent per day on various activities. The remaining three tables take on a different form. One tableprovides counts relating to perception of task-sharing with partners; the second covers numbers of peoplewho have done different types of unpaid work in the previous four weeks; the third provides counts ofpeople who participated in Mäori cultural activities in the previous four weeks.

ReliabilityTwo types of error are possible in estimates based on a sample survey: sampling error and non-samplingerror. Sampling error is a measure of the variability that occurs by chance because a sample rather than anentire population is surveyed. Non-sampling errors include errors arising from biases in the patterns ofresponse and non-response, inaccuracies in reporting by respondents, and errors in the recording and codingof data.

A1.2 The New Zealand Income SurveyPurposeThe New Zealand Income Survey is designed to provide timely and robust information on income receivedfrom the labour market and government transfers.

The survey is run annually as a supplement to the Household Labour Force Survey (HLFS) during the Junequarter (April to June). It was run for the first time in the June 1997 quarter. All respondents to theHousehold Labour Force Survey are surveyed. All questions, with the exception of the annual incomequestion, relate to the respondent’s most recent pay period.

DesignThe target population for the New Zealand Income Survey is the civilian usually-resident non-institutionalisedpopulation aged 15 and over. Approximately 15,000 private households and 30,000 individuals are sampledeach quarter, on a statistically representative basis from rural and urban areas throughout New Zealand. Thegroups that are excluded from the survey sample are: long-term residents of old people’s homes, hospitalsand psychiatric institutions; inmates of penal institutions; members of the permanent armed forces; membersof the non-New Zealand armed forces; overseas diplomats; overseas visitors who expect to be resident inNew Zealand for less than 12 months; those aged under 15 years of age; and people living on offshoreislands (except for Waiheke Island). However, estimates use the assumption that the distribution ofcharacteristics of those in non-private dwellings is similar to those in private dwellings.

MethodThe method of collection for the New Zealand Income Survey is a personal interview, largely conductedover the telephone as a supplement to the HLFS.


OutputsThe output variables of interest are:

Recent incomes data (gross of taxation):

• Wages and salaries (up to 3 jobs), including irregular payments, commissions, etc.

• Self-employment net profit

• Government transfers

• Private pensions

Note that investment income (unless from self-employment) is not included.

As a result of the New Zealand Income Survey, different wage rates for different activities can be obtained.The wage rate which was used in this report was a housekeeper wage rate. The classification that this wagerate is based on is the New Zealand Standard Classification of Occupations 1999. The classification is ahierarchical classification with five levels. There are 9 major groups, 25 sub-major groups, 99 minor groups,260 unit groups and 567 occupations. Below is a copy of the classification. It shows the 9 major groups, butalso goes down to the third digit level for one of the major groups so that the exact housekeeping classificationused for this report is shown.

1 Legislators, administrators and managers

2 Professionals

3 Technicians and associate professionals

4 Clerks

5 Service and sales workers

5.1 Personal and protective services workers

5.1.1 travel attendants and guides

5.1.2 Housekeeping and restaurant services workers5.1.3 Personal care workers

5.1.4 Other personal services workers

5.1.5 Protective services workers

5.2 Salespersons, demonstrators and models

6 Agriculture and fishery workers

7 Trade workers

8 Plant and machine operators and assemblers

9 Elementary occupations (including residuals categories)

ReliabilityThe Household Labour Force Survey sample comprises approximately 15,000 private households, sampledon a statistically representative basis from rural and urban areas throughout New Zealand. The final NewZealand Income Survey dataset consists of approximately 24,000 valid person records and 4,000 imputedperson records.

Two types of error are possible in estimates based on a sample survey. Sampling error is a measure of thevariability that occurs by chance because a sample rather than an entire population is surveyed.

The New Zealand Income Survey is also subject to non-sampling error. Non-sampling errors include errorsarising from biases in the patterns of response and non-response, inaccuracies in reporting by respondents,and errors in the recording and coding of data.

Sample error for housekeeping wageThe estimated relative sampling error for the average hourly wage for people in occupation 512 ‘Housekeepingand restaurant services workers’ is 5 percent at the 95 percent confidence interval.



Appendix 2:

Splitting time use survey codesinto activitiesA2.1 Time use survey codes0100 Personal care nfd0111 Personal hygiene and grooming0121 Sleeping0131 Eating and drinking0141 Private activities0151 Personal medical care0188 Travel associated with personal care0199 Other personal care nec

0200 Labour force activity nfd0211 Work for pay or profit0221 Education or training in work time0231 Job search activities0288 Travel associated with labour force activity0299 Other labour force activity nec

0300 Education and training nfd0311 Formal education0321 Work-related training not in work time0331 Informal education and training0341 Homework or study for any course or class0388 Travel associated with education and training0399 Other education and training nec

0400 Household work nfd0410 Food or drink preparation and cleanup nfd0411 Preserving and brewing0412 Meal or snack preparation and cleanup0420 Indoor cleaning, laundry and other clothes care nfd0421 Indoor cleaning0422 Laundry and other clothes care0430 Grounds maintenance and animal care nfd0431 Tending edible plants0432 Tending domestic animals (excluding pets)0433 Other grounds maintenance and pet care0440 Home maintenance nfd0441 Home repair or improvement0442 Heating and water upkeep0443 Vehicle maintenance0449 Other home maintenance nec0451 Household administration0461 Production of household goods0471 Gathering and collecting food for household consumption0488 Travel associated with household work0499 Other household work nec


0500 Caregiving for household members nfd0511 Physical care of household members0521 Available for care of household members0531 Playing with household members0541 Teaching household members0551 Helping household members with educational activities0588 Travel associated with caring or helping for household members0599 Other caring or helping for household members nec

0600 Purchasing goods and services for own household nfd0610 Purchasing goods and services nfd0611 Receiving health services0612 Waiting for health services0613 Purchasing goods and services (excluding health services)0688 Travel associated with purchasing goods and services

0700 Unpaid work outside of the home nfd0710 Unpaid work (formal) nfd0711 Administration (formal)0712 Training and fundraising (formal)0713 Service provision (formal)0718 Travel associated with unpaid work (formal)0719 Other unpaid work (formal) nec0720 Unpaid work (informal) nfd0721 Caring for non-household members (informal)0722 Helping non-household members (informal)0728 Travel associated with unpaid work (informal)0729 Other unpaid work (informal) nec

0800 Religious, cultural and civic participation nfd0811 Religious practice0821 Attending weddings, funerals and other ceremonies0831 Participation in ceremonies or rituals significant to Mäori culture0838 Travel associated with participation in ceremonies or rituals significant to Mäori culture0841 Civic responsibilities0851 Attending meetings of political, citizen, fraternal, union, professional, special- interest, identity

groups etc0861 Filling in Time Use diary0888 Travel associated with religious, cultural and civic participation (excluding participation in

ceremonies or rituals significant to Mäori culture)0899 Other religious, cultural and civic participation nec

0900 Social entertainment nfd0911 Attending a sports event as a spectator0920 Attending entertainment as a spectator nfd0921 Attending performing arts as a spectator0922 Attending the cinema0923 Visiting the library0924 Visiting exhibitions, museums and art galleries0929 Attending other entertainment as a spectator nec0931 Socialising and conversation0988 Travel associated with social entertainment0999 Other social entertainment nec


1000 Sports and hobbies nfd1011 Playing organised sport1021 Exercise1031 Pleasure drives, cruises, sightseeing1041 Taking part in performing arts1051 Hobbies and games1061 Gambling1088 Travel associated with sports and hobbies1099 Other sports and hobbies nec

1100 Mass media and free time activities nfd1111 Watching television or video1121 Listening to music or radio1131 Reading1141 Accessing internet1151 Thinking, reflecting, relaxing, resting and planning1161 Smoking1188 Travel associated with mass media and free time activities1199 Other mass media and free time activities nec

9977 Response unidentifiable9988 Response outside scope9999 Not stated


Figure 13Time Use Survey codes split into all types of activities

Activites Examples and time use codesUnpaid work inside the Housing Cleaning, household maintenance, gardening household 0400, 40% of 0420, 0421, 60% of 0430, 60% of 0433,

0440, 0441, 0442, 0443, 0449, 40% of 0451, 0488, 0499,15% of 0600, 15% of 0610, 15% of 0613, 15% of 0688

Nutrition Preparing meals, gathering food, cleaning up afterwards 0410, 0411, 0412, 0431, 0432, 40% of 0451, 0471, 40% of 0600, 40% of 0610, 40% of 0613, 40% of 0688

Clothing Washing clothes, ironing, mending clothes

60% of 0420, 0422, 10% of 0451, 0461, 30% of 0600, 30% of 0610, 30% of 0613, 30% of 0688

Childcare for own household Childcare for own household0500, 0511, 0521, 0531, 0541, 0551, 0588, 0599(depending on who for)5% of 0451, 7.5% of 0600, 7.5% of 0610, 7.5% of 0613,7.5% of 0688

Other care for own household Caring for an elderly mother who lives in the same home0500, 0511, 0521, 0531, 0541, 0588, 0551, 0599(depending on who for)40% of 0430, 40% of 0433, 5% of 0451, 7.5% of 0600, 7.5% of 0610, 7.5% of 0613, 7.5% of 0688

Unpaid work outside the Childcare for other households Childcare for children in other householdshousehold 0700, 0720, 0721, 0722, 0728, 0729

(depending on who for)Other care for other households Care of adults and pets in other households

0700, 0720, 0721, 0722, 0728, 0729 (depending on who for)


Volunteering for private non-profit institutions like New Zealand Red Cross or Girl Guides Association, being the treasurer for the local hockey club

0710, 0711, 0712, 0713, 0718, 0719Other activities Market work Production of goods and services for pay or profit

0200, 0211, 0221, 0288, 0299, 0321Self-education Homework, studying a car manual, time spent in school

classroom, university student studying0300, 0311, 0331, 0341, 0388, 0399

Sleeping 0121Eating and drinking 0131Personal care Cleaning your teeth, having a shower, brushing your hair

0100, 0111, 0141, 0151, 0188, 0199, 0611, 0612Recreation Playing sport, going to church, watching television, reading

0800, 0811, 0821, 0831, 0838, 0841, 0851, 0888, 0899,0900, 0911, 0920, 0921, 0922, 0923, 0924, 0929, 0931,0988, 0999, 1000, 1011, 1021,1031, 1041, 1051, 1061,1088, 1099, 1100, 1111, 1121, 1131, 1141, 1151, 1161,1188, 1199

Not stated 0861, 9977, 9988, 9999

All types of activities


Figure 14Time Use Survey codes split into unpaid work activities

Providing housing

Providing nutrition

Providing clothing

Providing care Informal unpaid work Formal unpaid work

Outputs Accommodation for members of the household

Meals, snacks, drinks for members of the household

Clothes and their care for members of the household

Care services to children, the sick, elderly, and pets in the household

Care services to children, the sick, elderly, and pets outside the household

Goods and services for other institutions

Principal activities

House construction and renovation 50% of 0441

Food preparation, meals and snacks, baking 50% of 0410, 0411, 50% of 0412, 0471,

Producing textiles, handicrafts 0461

Physical care, supervision, reading or playing, teaching the child, accompanying the child, adult care, pet care 0500, 0511, 0521, 0531, 0541, 0551, 0559

Informal help for children, adults, pets 0700, 0720, 0721, 0722, 0729,

Organisational work, caring for people via a voluntary service organisation, environmental and animal protection 0710, 0711, 0712, 0713, 0719

Ancillary activities

Shopping Buying a dwelling, renting a dwelling, buying furniture, carpets and equipment for dwelling, buying household textiles 15% of 0600, 15% of 0610, 15% of 0613

Shopping for appliances for: cooking; cooling; freezing and storing food; groceries 40% of 0600, 40% of 0610, 40% of 0613

Shopping for: clothing materials; garments; shoes 30% of 0600, 30% of 0610, 30% of 0613

Shopping for: toys; books; baby carriages; strollers 15% of 0600, 15% of 0610, 15% of 0613

Maintenance Repairs to dwelling, repairing equipment, furniture and household goods, heating and water, various arrangements 30% of 0430, 30% of 0433, 0440, 50% of 0441, 0442, 0449

Care of clothes and shoes 20% of 0420, 20% of 0422

Care of pets, walking dog 40% of 0430, 40% of 0433

Gardening Tending ornamental plants 30% of 0430, 30% of 0433

Tending edible plants, tending domestic animals 0431, 0432

Cleaning Cleaning dwelling, cellar, garage, yard 0400, 40% of 0420, 0421, 0499

Dish washing 50% of 0410, 50% of 0412

Laundry, ironing 40% of 0420, 80% of 0422

Transport Travel related to household care, vehicle maintenance 0443, 0488, 15% of 0688

Travel related to shopping and services 40% of 0688

30% of 0688 Travel related to childcare, or adult care of own household 0588 15% of 0688

Travel related to childcare, or adult care of other households 0728

Travel related to formal unpaid work 0718

Management Paying bills, decision making 40% of 0451

Food management e.g. planning meals, groceries 40% of 0451

Planning and decision making 10% of 0451

Coordinating children's activities 10% of 0451

Adapted from: Eurostat (1999) Proposal for a Satellite Account of Household Production.

Unpaid work outside the householdUnpaid work inside the household



Appendix 3:

Comparisons with 1991During August 1990, the then Department of Statistics carried out a pilot time use survey. The purpose ofthis study was to determine whether it was feasible for a full time use survey to be conducted in NewZealand. The results of the pilot study indicated that it was “possible to collect information from NewZealanders on their use of time using a 48-hour self-completed diary as the main method of data collection.”40

However, it was not until eight years later that a full time use survey was conducted.

There were two main reports written as a result of the pilot time use survey. The first report, Testing Time,was released in 1991 and concentrated on the methodological issues of conducting a time use survey. In1992, a second report, Options for the Valuation of Unpaid Work in New Zealand 1991, was produced. Thispaper concentrated on using data from the pilot time use survey to produce indicative estimates of the valueof unpaid work in New Zealand.

The main purpose of the pilot time use survey was to test alternative survey methodologies. It was notdesigned with the intention of providing accurate data on the detailed use of time. Consequently, it is difficultto draw any firm conclusions when comparing the 1991 and 1999 results.

As shown below in Table 24, the GDP ratios between the 1991 and 1999 results are fairly similar.

In 1991, the estimated value of unpaid work using the housekeeper replacement cost method was $30,499million, equivalent to 42 percent of GDP. In contrast, the 1999 value of unpaid work was $39,637 million,equivalent to 39 percent of GDP.

Table 24Value of unpaid work comparison with 1991


$(million)

Value of Gross Domestic Product

$(million)

Gross Domestic Product

(%)

1991 30,499 73,113 421999 39,637 101,169 39Difference 9,138 28,056 -3

Note1 The 1990/91 value of gross domestic product has been adjusted toaccommodate the November 2000 revision to gross domestic productas a result of implementing SNA93. This means that the proportionof the value of unpaid work in August 1990 compared with the 1990/91 estimate of gross domestic product has changed since the originalpubliction.

Note2: Figures may not add due to rounding.

A3.1 Differences between the two estimatesThe 1991 estimates were from a small sample pilot survey, while the 1999 estimates were from a full survey.In addition, the 1991 estimates

• were weighted to include people living in non-private dwellings, while the 1999 estimates excludednon-private dwellings

• utilised a typical housekeeper wage rate from the Prevailing Weekly Wage Rate Index, whereas 1999estimates used a median housekeeper wage from the New Zealand Income Survey

40 Department of Statistics (1991), Testing Time, Department of Statistics, Wellington, page 9.


• were based on a pilot test run over a month in August 1990, but were taken to represent the wholeyear, whereas 1999 data covered a full year

• were for those aged 12 years and over, whereas 1999 estimates were for those aged 15+.

A3.2 Demographic changesHousehold sizes are generally getting smaller. According to population census results, there were 233,037one person households in 1991, and 260,712 in 1996 - an inter-censal increase of 27,675, or 11.9 percent.41

One person households had the second largest numeric increase after couple only households (up 30,936).As the number of one person households increases, household work is likely to increase, as one personhouseholds are likely to be less efficient. For example, it can take the same amount of effort to cook a mealfor one person as for two people.

41 Statistics New Zealand (1998), New Zealand Now: Housing, Statistics New Zealand, Wellington.


Appendix 4:

Glossary of termsAvailable for careA code in the Time Use Survey 1999 representing time during which the respondent, while undertakinganother activity, was responsible for someone who could not be left alone.

Consumption of fixed capitalThe reduction in the value of the fixed assets used in production during the period resulting from physicaldeterioration, normal obsolescence or normal accidental damage. In the context of a household satelliteaccount, this represents the decline in the value of household durables.

EmployedAll those in the working-age population (usually-resident non-institutionalised civilian population aged 15years +) who during their Time Use Survey reference week:

(a) worked for one hour or more for pay or profit in the context of an employee/employer relationship orself-employment; or

(b) worked without pay for one hour or more in work which contributed directly to the operation of afarm, business or professional practice owned or operated by a relative; or

(c) had a job but were not at work due to own illness or injury, personal or family responsibilities, badweather or mechanical breakdown, direct involvement in industrial dispute, or leave or holiday.

Formal unpaid workWork that is carried out for people living outside the respondent’s own household and which is done for orthrough an organisation or group.

Informal unpaid workWork that is carried out for people living outside the respondent’s own household and which is not done foror through an organisation or group (e.g. helping a neighbour or friend).

Intermediate consumptionThe value of goods and services consumed as inputs by a process of production, excluding fixed assetswhose consumption is recorded as consumption of fixed capital. In the context of a household satelliteaccount, this represents the value of non-durable goods and services that are used up in household production.

MäoriA code in the Time Use Survey 1999 representing all respondents who indicated that New Zealand Mäoriwas one of their ethnic groups, regardless of whether any other ethnic group was also specified.

Mixed incomeIn the context of a household satellite account, the surplus or deficit accruing from production by households;it implicitly contains an element of remuneration done by members of the household that cannot be separatelyidentified from the return to the owner of the household as an entrepreneur, but excludes the operatingsurplus coming from owner-occupied dwellings. It represents the compensation to household labour and thereturn on household durables (capital) used in household production.

Non-MäoriA code in the Time Use Survey 1999 representing all respondents who did not indicate that New ZealandMäori was one of their ethnic groups.


Non-productive activityAn activity which can neither be obtained by hiring a worker nor by renting capital equipment in the market.This definition follows the ‘third party’ and ‘market alternative’ criteria, introduced by Reid (1934) andIronmonger (unpublished, 2001), respectively. With this in mind, the following classes of activity areconsidered to be non-productive:

• self education

• sleeping

• eating and drinking

• personal care

• recreation

Non-profit institutions serving households (NPISHs)Non-profit institutions that provide goods and services to households either free or at prices or fees that arenot economically significant, and that are not controlled or mainly financed by government units.

Not employedAll those in the working-age population (usually-resident non-institutionalised, civilian population aged 15years and over) who during their Time Use Survey reference week were unemployed or not in the labourforce. In other words, they were not employed (as defined above).

Not statedAll activities in the Time Use Survey coded to the ‘Residual’ category of the activity classification. Thiscombines diary descriptions of activities which were unidentifiable or out-of-scope, plus times in the diarywhere no activity was specified.

Primary activityThe activity in the Time Use Survey recorded in the first column in the time use diary.

Productive activityAn activity which can be obtained either by hiring a worker or by renting capital equipment in the market.This definition follows the ‘third party’ and ‘market alternative’ criteria, introduced by Reid (1934) andIronmonger (unpublished, 2001), respectively. With this in mind, the following classes of activity areconsidered to be productive:

• unpaid work occurring either inside, or outside, the household

• market work.

Secondary activityThe first listed activity in the second column of the Time Use Survey diary.

Simultaneous activityAny activity in the Time Use Survey carried out while also carrying out a primary activity. This will consistof any secondary activity, plus any other activities listed in the second column of the time use diary.

Taxes (less subsidies) on productionTaxes (less subsidies) which are assessed on producers in respect of the production, sale, purchase and useof goods and services, and which add to the market prices of those goods and services. In the context of ahousehold satellite account it includes taxes for the use of certain durable goods such as motor vehicles.

With childrenA code in the Time Use Survey 1999 representing those households containing children i.e. persons agedunder 14 years.

Value addedThe amount added to goods and services by the contributions of capital and labour (i.e. the value of outputafter the cost of bought-in materials and services has been deducted).

Working-age populationThe usually-resident non-institutionalised, civilian population aged 15 years and over.


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