Measuring unpaid care in the Labour Account consultation

Care work, whether paid or unpaid, consists of activities and responsibilities involved in meeting the physical, psychological, and emotional needs of care-dependent groups. 

Care-dependent groups require care to live independently due to functional limitations. These groups include children due to their young age, and adults with long-term health conditions or disability.

Care work for these groups range from: 

• helping with direct, hands-on care tasks such as activities of daily living (e.g. feeding and bathing),
• helping with more complex or indirect care tasks such as instrumental activities of daily living (e.g. cleaning, transportation, coordinating care), 
• supervising and monitoring the care receiver

Adapted from Canada's Care Economy: A Conceptual Framework 

Measures of unpaid childcare work have been produced by four different valuation methods. These methods apply different monetary values to the childcaring activity.

• Individual function replacement cost method: equivalent occupation for each childcaring activity
• Minimum wage replacement cost method: flat minimum wage
• Housekeeper wage replacement cost method: relevant housekeeper wage
• Opportunity cost method: wage of carer’s main occupation

The Individual function replacement cost method is the approach recommended by the ABS for valuing unpaid childcare. However, other methods have been presented in the information paper to provide a valuation range.

The estimated unpaid childcare total for sex will not equal the total for age for every measurement method except the Minimum wage replacement cost method. The same occupation may have different applicable wage rates, depending on whether the wage rate was taken from the associated age group or the relevant sex of the unpaid child carer. 

In the information paper, the ABS has presented the age total rather than the sex total, as this is created from the finer classification breakdown of five age groups, compared to the sex categories.

To force the sex and age totals to align, some finer level data used to create the estimates will be omitted and the accuracy of the estimates will reduce.

The Labour Account is currently being expanded to include sex and age breakdowns of some paid work estimates. This data can aid in comparing unpaid care work to the labour market.

Due to the input data used for each model, the proposed Labour Account paid work age groupings differ to the unpaid childcare valuation age groupings.

Paid work age groupings: 19 years and under, 20 – 24 years, 25 – 34 years, 35 – 44 years, 45 – 54 years, 55 – 64 years, 65 years and over

Unpaid childcare age groupings: 15 – 20 years, 21 – 34 years, 35 – 44 years, 45 – 54 years, 55 years and over

Consistent age groupings between the models would allow easier comparison, however modifying the age groupings may impact the accuracy of the estimates.