This article first appeared in the summer 1996 issue of the Expert Witness.
When a claim is made for loss of household services capacity, we are faced with the challenging task of determining the claimant’s pre-accident household service contribution, and comparing this to his or her post-accident capacity for household services. The difference between the pre- accident contribution and the current contribution represents the claimant’s loss of household service capacity. One simple way of measuring this loss is to calculate the number of additional hours that it would take a replacement worker to perform all of the tasks which the claimant can no longer do. This is the approach taken by Economica.
However, the number of additional hours that a claimant would require to complete the chores which can no longer be performed may overstate the amount of time required by replacement workers; and therefore, using this estimate without adjustment would overstate the claimant’s true loss. Accordingly, an adjustment needs to be made to accurately estimate the claimant’s loss: replacement workers will typically be more productive than the claimant, so the “loss” of household service hours must be adjusted downwards to reflect this productivity. The question one asks now is, “How much more productive are replacement workers compared to the typical claimant?” The answer to this question will guide the adjustment we need to make to the number of lost household service hours claimed. Fortunately there is research in this area which we can rely on.
In his book Economics and Home Production – Theory and Measurement (Brookfield USA: Avebury, 1993), Euston Quah estimates the efficiency of replacement household service workers (i.e., “domestic help”). Based on a survey of 167 households Quah found that for 2-member households, hired help was 64 percent more efficient than the household members. For 3-5-member households, hired help was 46 percent more efficient; and for households with 6 or more members, hired help was 33 percent more efficient. For those families without children, Quah reported efficiency gains of 62 percent. For families with 1-2 children, he found efficiency gains of 43 percent, and for families with 3-5 children, efficiency gains amounted to 40 percent.
Quah concluded that the productivity of workers hired by small households was relatively high because those households tended to hire workers only to undertake specialised tasks, such as ironing. Larger households hired less specialised, housecleaning staff. Hence, as most calculations of the value of housework assume that it is non-specialists who are being hired, we recommend that the lower productivity factors identified above, 33-40 percent, be applied. This implies that the number of “lost hours” claimed should be reduced by 25-30 percent. (A worker who is 33 percent more productive requires 25 percent fewer hours to complete a given task.)