Because checking everything twice, gathering countless toys and driving the sleigh are tasks done not only by Santa but also by accounting clerks, professional shoppers and pilots, we can figure out Santa’s annual income.
Where are we going? To Santa’s salary and the GDP.
If we add together what Santa would have been paid for all he does, his total earnings would be $143,054.14 in 2015. To generate that number, the people at Insure.com matched all of Santa’s tasks with a similar job from the Bureau of Labor Statistics. After noting wages and salaries for those jobs, they just plugged in the hours Santa devoted to each responsibility and multiplied by the mean hourly wage.
Our Bottom Line: Accounting for Unpaid Work
When economist Simon Kuznets created the concept of national income accounting during the 1930s, he was talking about what we now call the GDP. Looking for a metric on which to base a yearly comparison of what we produce, he decided to include only goods and services that could be legally purchased. The value of unpaid work done at home was excluded because it was tough to quantify. For illegal transactions, he was said to have believed they were not a valid indicator of what the nation produced.
Evolving somewhat since the 1930s, with today’s national income accounting we combine consumption expenditures, what government spends, gross investment (primarily a business spending component but includes residential housing) and the value of exports minus imports (usually a negative number) to get the Gross Domestic Product.