By Jonathan Gershuny
When economists measure growth, they often focus on the money economy – the goods and services that are produced, bought and sold. However, this focus leaves out an enormous amount of human activity that is vital to our well-being.
The benefits and costs of growth are shaped by the entire chain of activities that meet human needs – from mining raw materials to running transport systems, furnishing homes and doing household chores.
Public choices, including about infrastructure, taxes or subsidies, determine not only the shape of the economy but also who benefits from it. To properly understand these choices, we need statistics that measure more than just money changing hands.
This new ESCoE Discussion Paper highlights the economy’s “dark matter”: the vast, unmeasured world of unpaid work, unpurchased consumption and the unintended consequences of daily life. It builds on nearly a century of work in this area, including important contributions by the UK Office for National Statistics (ONS).
What’s missing from GDP?
The System of National Accounts (SNA) is the international standard for measuring GDP and related indicators. While GDP measures market transactions, government and non-market institutions serving households’ activity, it does not capture:
- Unpaid household services production – From cooking and cleaning to childcare and DIY, these activities provide essential services but are excluded because they do not involve money exchange.
- Unintended outcomes of economic activity – Effects like pollution, sustainability impacts or the consequences of overwork and stress. These outcomes matter deeply for individuals and societies but are not captured as part of economic output.
Together, these blind spots reveal how narrowly the economy is often defined.
How can we measure unpaid work during the day?
There are 1440 minutes in the day. People spend these minutes across three main categories:
- Paid work – Employment in the money economy.
- Unpaid work – Household production and care work.
- Consumption – The activities through which we directly meet our needs and wants, from eating and leisure to sleep and rest.
Time-use surveys, which track how people spend their days, offer a way to rebalance our picture of economic life. They show that in many wealthier countries, unpaid work accounts for about half of all work time, and it is growing as a share of the total.
Another indicator of the extent of unmeasured economic activity is the proportion of household spending on goods and services that are not directly consumed but instead function as inputs into unpaid household production. This includes buying ingredients to prepare meals or purchasing a car used to transport family members. In the UK in 2018, this share was approximately two-thirds, a striking figure (see table 3 in the paper and appendix materials).
What accounting approaches can we use to measure hidden activities?
To bring these missing elements into view, the discussion paper sets out two complementary accounting approaches:
- Dual-entry accounts – Extending the traditional input-output model by assigning “shadow prices” to the services produced with unpaid labour, household equipment, and to consumption time. This reveals the full extent of goods and services society produces and consumes, whether inside or outside the market.
- Single-entry accounts – Multiplying the time spent in all activities – both work and consumption – by coefficients representing its wider effects (for example, the health benefits of exercise or the pollution costs of commuting). This captures the latent consequences of activity that aren’t bought and sold but are real and significant.
Both approaches rest on the same foundation: time-use data, which provides a common denominator for integrating paid and unpaid work, consumption, and outcomes.
Economic accounting – starting from consumption
One of the most innovative proposals is to reverse the usual order of economic accounting. Instead of starting with production, we can start with the full range of consumption activities observed in time diaries, then work backwards through the unpaid and paid work required to support them.
This requires a sharper definition of consumption: what happens when the intended outcome of an activity (e.g., nutrition, entertainment, rest, knowledge acquisition) penetrates the boundary of the self (via the senses or the imagination) and changes an individual’s state. Crucially, this definition distinguishes between:
- Manifest consequences – The intended or desired outcomes of activity, which can be measured through dual-entry accounts.
- Latent consequences – The unintended effects such as fatigue, pollution, or the structuring of daily life, which cannot meaningfully be valued in money terms but can be observed and assessed in other ways.
This distinction shows why dual-entry and single-entry accounts are both necessary: one captures the measured economy of wants, the other captures the unintended effects or outcomes of activity.
Why do multiple measures matter?
Some argue that these latent consequences should be “monetised” and added to GDP, but this can be misleading. For example, the health impacts of work may be far more important in the long run than the wages received, but they do not fit naturally into a price framework.
Instead, the paper calls for a new dashboard of measures to complement existing dashboards, such as the ONS well-being dashboard. On one side, we would have an extended version of national product. This would add the value of unpaid work and household production (using shadow prices), so we get a fuller picture of all the goods and services people actually produce and consume.
Alongside it, we would have a set of social indicators (from the single-entry accounts) that track the unintended consequences of daily activity. These would include impacts on health, well-being, pollution and sustainability.
As they both use the same time-use data, they can be compared directly. This would make it easier to evaluate whether a new economic development increases household consumption at the cost of declining health or well-being.
Looking ahead
The empirical evidence already shows that unpaid work and non-market activity account for a large and growing share of all work in rich economies (see figure 3 below). What we do not yet know in detail is how this affects different groups, by income, gender or age. We also have little knowledge about how the benefits and burdens of unpaid work are distributed across society. That is the next step.
What is clear is that relying solely on money-based accounts leaves us with an incomplete and potentially misleading picture of the economy. Incorporating missing activities would not just improve our statistical systems, it would reshape how we think about growth, productivity and well-being, placing households, time and lived experience at the centre of the economic story.
Summary
Unpaid work – such as childcare, housework and community care – makes up nearly half of all work in advanced economies, yet it remains invisible in GDP. This blog explores how time-use data can capture the hidden economy of unpaid labour and everyday consumption, why traditional National Accounts overlook it, and how a new dashboard of measures that combines extended national product with social indicators like health, well-being and sustainability can give a fuller picture of economic life.
ESCoE blogs are published to further debate. Any views expressed are solely those of the author(s) and so cannot be taken to represent those of the ESCoE, its partner institutions or the Office for National Statistics.