Redistributing paid and unpaid labour could net each household an extra €1000 a year

Dutch households would gain an annual € 1000 extra if men and women started doing the same amount of unpaid and paid work. As women now do more unpaid work than men do, households lose out on a good chunk of income. These are the conclusions of research institute SEO Amsterdam Economics in a study commissioned by ABN AMRO.

The institute's economic simulation reveals what the 2020 situation would have looked like if we had achieved true gender equality back in 2010. As the calculations show, an equal division of unpaid and paid labour between men and women would have led to an annual GDP increase of 10.8 billion euros. The total number of hours worked remains the same as it was in reality. Here are some other highlights from the report:

• The gender pay gap* down 12 percentage points in corporate and 4 in government work

• The unexplained pay gap** equals an additional 4.4 billion euros a year

• The number of financially independent women up by 13 per cent

• Redistributing labour this way does not lead to lower wellbeing or higher absenteeism

Dutch gender equality simulation

The report, Gender equality, presents a simulation in which households started equalising paid and unpaid work between the sexes back in 2010. The results show the consequences for individuals, households and the Netherlands as a whole. In reality, on average women do more unpaid work than men do, especially in terms of household tasks and informal care. In a gender equal situation, women would do over 25% more paid labour. Men, on the other hand, would do 17.1% less paid labour. As a result, average per capita income would rise by 881 euros a year and by over 1000 euros per household.

"This report reflects what the problem of gender inequality means from an economic perspective. This form of inequality is costing society money. Moreover, it shows how, by redistributing unpaid and paid work between women and men, we as a society are becoming more productive. No one needs to work more hours, the work is just distributed differently. That is exactly what would boost our country's GDP. And it also results in a higher average income per household", says Chantal Korteweg, Director of Inclusive Banking at ABN AMRO.

Equal distribution of unpaid and paid work pushes up income for women

The unequal distribution of unpaid work in the Netherlands creates imbalances in the labour market. As women and men grow older and start having children, careers and corresponding incomes increasingly diverge. The difference in hourly wages between men and women starts to diverge around the age of 30-35. This is often related to starting to care for children. In fact, at the age when couples have children, women typically start to do significantly less paid work while the male partner continues working a paid 9 to 5 job. This reduces women's income, particularly because it means they work fewer hours in a paid job and do more hours of unpaid work. From this point on, the hourly wage gap between women and men begins to widen, creating a skew in work history and opportunities for advancement. Korteweg: "The simulation shows how painful the impact of a skewed distribution of work and care hours is in the Netherlands. A redistribution can provide enormous positive effects."

*gender pay gap:A systematic difference in total salary between men and women with comparable education and experience.

**unexplained pay gap:Part of the pay gap can be explained by differences in background characteristics such as hours worked, education or employment contract. There is also a portion of the pay gap for which there are no identifiable causes. This is the unexplained pay gap.

Jarco de Swart