There’s a small act of unpaid labour that millions of us now perform several times a week without noticing.
We scan our own shopping. We weigh the loose courgettes, hunt for the barcode, pack our own bags, and apologise to a machine for an unexpected item in the bagging area. Work that a paid person used to do, we now do ourselves, for nothing.
As far as the country’s single most important economic number is concerned, that work has simply disappeared. When a cashier scanned your shopping, their wage was counted. Now that you do it, nothing is counted, because nobody was paid.
The task is identical. The measure just can’t see it any more.
That tiny vanishing act is a window onto a much larger problem with how we decide whether a country is doing well. The number in question is GDP, gross domestic product, the figure governments rise and fall by. And the man who invented it spent the rest of his life warning us not to use it like this.
Simon Kuznets built the first proper national accounts in the 1930s, to help a Depression-stricken America grasp the scale of its own collapse. It was a genuine leap forward. But in the very report that introduced the measure, in 1934, he attached a warning:
“the welfare of a nation can scarcely be inferred from a measurement of national income.”
He even cautioned against treating things like military and advertising spending as if they made a country richer. He was ignored, thoroughly, for the better part of a century.
The trouble is that GDP counts activity, and paid activity at that, rather than value. Which produces some very odd verdicts. A parent raising their own children: invisible. Pay a nursery to do it: growth. A woodland left standing: nothing. Cut it down and sell it: growth. A car crash, a divorce, a flood and the clean-up that follows: all, cheerfully, growth. Meanwhile the things that actually make a life worth living, an afternoon with your family, a walk, a favour done for a neighbour, the quiet volunteering that holds a community together, register as exactly zero, because no money changed hands.
The self-checkout is just the newest entry on a very long list. Real work, real value, invisible, because it wasn’t paid for.
So why does a wonky national statistic belong in a financial planning blog?
Because it is the grandest possible example of a mistake we all make in miniature: confusing what is easy to measure with what actually matters.
We do it with our own money all the time. The portfolio value becomes the scoreboard, because it’s a number and it updates every day. Net worth becomes the measure of a life, because it fits neatly in a spreadsheet. Meanwhile the things the money is actually for, time, freedom, security, the ability to say yes to your family and no to work you’ve come to dread, have no live price, so they quietly fall out of the reckoning. And we end up, exactly like a government chasing GDP, polishing the proxy while losing sight of the point.
Kuznets’ warning scales all the way down to a single household. The welfare of a person can scarcely be inferred from a measurement of their portfolio, either.
The number on your statement is useful, in precisely the way GDP is useful: a rough gauge of one narrow thing. It was never meant to be the target. A good life, like a good country, turns out to be made mostly of things the till was never able to count.
We help people in Hook and across Hampshire, Surrey, Berkshire, Sussex and Kent keep the number in its place: useful servant, poor master. It’s a distinction worth getting right early.
Altor Wealth Management LLP is authorised and regulated by the Financial Conduct Authority (FCA number 769033). Registered office: Landmark House, Station Road, Hook, Hampshire RG27 9HA. This article is general information, not personal advice. The value of investments can fall as well as rise.