The Invisible Hand

Most economies have been mesmerised by Adam Smith’s concept of the invisible hand and its positive impact, driven by private profit incentives and free competition rather than coercion. This invisible hand is believed to guide the economy and bring stability and growth. I strongly feel that there is yet another powerful invisible hand that creates, shapes and maintains the human resource-the homemakers. The ILO states that 6.4 billion hours daily are spent performing unpaid care labour. In other words, it means 2 billion individuals working 8 hours every day without pay. Women do eighty per cent of the unpaid care work in Asia. Yes- women have been identified with unpaid care work and have remained invisible in the National Accounts. Labour inside the household has undoubtedly restricted women and has prevented them from being a part of the labour market. Unpaid household work is also a powerful weapon of intimidation, bringing forth the notion that housework is not actual work at all -after all it is unpaid. The status of women is at stake. The monetisation of this unpaid work is only discussed in household kitchens and is only a part of bedroom quarrels. The Labour Force Participation Rate in an economy is positively correlated to its growth and development. The Labour Force Participation Rate [LFPR] for females in India is acutely lower compared to males. The NSO data on PLFS-2022-23 highlights that only less than four in ten working-age women enter the labour force as compared to eight in ten men. The gap between female and male LFPRs is one of the sharpest in India. And when women do enter the labour market, they earn significantly less than men for performing the same work. According to the World Economic Forum, women earn just 71% of what men earn.

The ILO states the gender pay gap in India is 27% as of 2023. It is an economic issue with a strong cultural and patriarchal root. Prof. Claudia Goldin, the Nobel laureate has explained gender differences in earnings and employment rates over 200 years, connecting it to the nature of work and the role of societal expectations regarding childbearing. It was confirmed by a study conducted by The Kerala Knowledge Economy Mission which found that in Kerala 57% of women left the labour force because of the burden of household work. For instance, the presence of small children in the household increases the value of time in the nonmarket sector for the person most responsible for child care and, hence, also would increase the reservation wage. Therefore, it is not surprising to find women participating in the labour force intermittently. They work prior to the arrival of the first child, withdraw from the labour market when the children are small and need full-time care, and return to the labour market once the children enrol in school. The male-female gap in labour force participation is highest in the reproductive years for females. On the job front, due to growing disparities, humiliation, violation, and vulnerability are rampant in workplaces compelling the government to formulate laws against workplace harassment. On the home front, the services of a housewife are rarely recognized or accepted as work at all.

She is taken for granted. A working woman undoubtedly means one working overtime clubbing inside household work with professional work. Combining paid work with the mountain of domestic labour at home also takes a toll on their health. Cooking, cleaning, and caring for the children, the old and the sick are never the manifesto of the male members. However, women have been saved by numerous technological interventions and developments -machines that have complemented household work. Despite this, female labour force participation has lagged, pulling back the economy’s potential for prospective growth and development. Services of housewives are not included in national income though they contribute to GDP. The crucial hurdle is how to calculate wages for household work. There is the challenge of distinguishing work and leisure and also the productive and unproductive work. Wages for housework would redefine the role of women in society and would lead to the welfare of a large segment of the population.

It can empower the women in an Indian patriarchal household. As Karl Marx stated, labour creates value and goods are crystallized labour. Women create value in the true sense of the word-they produce human resources, preparing and adding value to the economy’s potential. They selflessly spend huge quantities of time and energy preparing this resource-sacrificing the opportunity cost of earning an income outside of homes. It is this selfless service laced with love and care that acts as the invisible mechanism strengthening the foundation of an economy. It is this mechanism that facilitates the participation of men in the economy. Countries estimate the value of such services to be about 8-9% of the GDP of a nation. Economic growth on its own will not correct the gender disparity in the labour market. Social norms and cultural barriers may still keep the women at home and keep them away from the labour market. With evolving dynamics in the Indian labour market transforming work paradigms and providing flexibility through work-from-home and online platforms, women have many opportunities for economic participation. The opportunity cost of domestic work which they sacrifice would tend to be much higher. Addressing women’s safety, ensuring flexibility in working hours and creating gainful employment opportunities in a healthy social environment is the key to increasing women’s participation. The message is cleareither make provision for payment for domestic labour or ensure women’s labour force participation. Gender equality is an unfinished task and a human issue. We need to remember that when women do better, economies do better