Private Households

SIC 8811

Companies in this industry

Industry report:

This industry consists of private households that employ workers on or about the premises who serve in occupations usually considered as domestic service. This classification includes baby-sitting; domestic service; private estates; noncommercial farmhouses; private households employing cooks, maids, chauffeurs, and gardeners; personal affairs management; and noncommercial residential farms.

Industry Snapshot

This industry, unlike most others, is comprised of individuals, not companies. According to the Bureau of Labor Statistics (BLS), 805,000 individuals were employed in this industry in 2008. Historically, demand for help in the child care segment of this industry has been greater than the supply of workers. The need for household workers increased during the latter part of the twentieth century as more women with children entered the workforce and an aging population required private attendants or companions. As the baby boomer generation ages, employment opportunities for personal attendants are expected to continue to rise. Overall, employment in the household workers industry is expected to reach 910,000 by 2018, according to the BLS.

Organization and Structure

Generally, the organization of this industry can be defined by a simple employer and employee relationship, with one or more employers per household worker. In large households with a sizable staff, a butler or head housekeeper manages the other workers. Some private household employees contract with placement agencies that act as a partial employer, often by offering benefits to the workers and acting as an intermediary between employer and employee.

Traditionally, most U.S. domestics have been "general house workers" responsible for duties such as dusting; sweeping and vacuuming; and cleaning fixtures, ovens, and bathrooms. Some general house workers also take on such duties as cooking and childcare, although these are usually considered specialty areas. Another category of household workers includes those specifically involved in childcare. Workers employed on an hourly and casual basis are usually referred to as baby-sitters; those employed on a regular, ongoing basis who are in charge of infants are usually considered nannies; and workers in charge of older children are tutors or governesses. Household workers who assist the elderly or disabled are referred to as companions or personal attendants. Such employees generally prepare meals and do light housework. Depending on the person's needs, they also may help with bathing and dressing. Most household employees also are involved in the personal aspects of the employer's life. This is mainly true with nannies and personal attendants. Oftentimes, it is the household employee who is the stable figure in the lives of those being taken care of.

Large households employing workers may include a housekeeper, butler, cook, caretaker, and a launderer. Housekeepers and butlers are responsible for hiring and supervising household staff, and they normally do light housework. Butlers also answer phones, deliver messages, serve food and drinks, and act as personal attendants. Cooks are responsible for preparing and serving meals, ordering food supplies, and keeping the kitchen clean. Caretakers carry out heavy housework and maintenance, including light carpentry and plumbing.

Background and Development

Domestic workers have existed for centuries; early on, however, service often took the form of slavery or indentured servitude. In 1870, there were approximately 960,000 private household workers in the United States. Between 1870 and 1910, demand for such work increased rapidly because industrialization sparked a proliferation of middle- and upper-class families in urban areas. At this time, demand was easily met by the vast number of immigrants in the country. Yet, with this advance in industrialization, the status of household work declined. The gap between factory and domestic workers was widened by the emergence of benefits and legislation to protect factory workers.

For a short period, roughly between 1910 and 1920, the number of domestic workers in the United States declined. This drop was mainly due to the advent of compulsory education of children and the introduction of child labor laws. Between 1920 and 1940, the number of domestics working in the United States jumped from 1.36 million to a peak of 2.28 million. Domestic help was changing from a mostly live-in, full-time profession to one in which servants lived on their own and even worked on a part-time basis. This was spurred on, in part, because families living in small homes or apartments still hired household help. After World War I, this occupation drew immigrants with minimal language skills and African Americans moving north, for whom domestic service was one of the few occupations available. Since 1940, the number of private household workers in the United States has decreased. Despite having long dominated the industry, women began to leave these jobs when outside opportunities increased and they were able to work in better occupations.

In the early 1990s, the treatment of household help, particularly nannies, was publicized as a result of lawsuits against employers involving sexual harassment and physical violence. An article in the Wall Street Journal claimed that "nannies are among the most exploited workers in the country." Stories of unfair wage practices, long hours, and physical abuse emerged in the media. However, nannies and other household workers have had few legal rights in fighting harsh working conditions. In 1993, most states did not place a limit on the number of consecutive hours or days a household worker could work. Moreover, sexual harassment of household workers has not been illegal in most states. In New York, human rights laws have prohibited sexual harassment and discrimination of employees, but the laws specifically excluded domestic workers.

In 1993, employers' tax obligations were highlighted when it was discovered that one of President Clinton's nominations for attorney general had hired an illegal alien and had not fully complied in paying social security taxes for an employee. As a result, President Clinton proposed simplifying the tax laws for employers to make it clearer if they are required to pay social security tax on wages. Unless a private household worker is an independent contractor--which is rarely the case--employers are required to pay social security tax on any employee earning more than $50 per quarter to the federal government and any additional taxes required by their states.

This industry continued to have a short supply of workers in the 1990s due primarily to the working conditions, low status, and lack of health and fringe benefits (although some placement agencies offered benefits). Also, changes in immigration laws made work permits more difficult to obtain. The trend in the 1990s was away from private household help for childcare and toward the use of nurseries, which are often sponsored by employers. Other trends for childcare have included more use of day care facilities, which are operated by private companies and individuals working out of their homes.

While the actual number of workers declined by 6,000 workers from 1992 to 1998, opportunities for employment in this industry sector remained robust. In essence, more lucrative employment was available due to a strong economy in which employers competed for a scarce labor pool. With an increasing number of women joining the workforce, the demand for household help, child care, and (with an increasing population of senior citizens), elder care was expected. In lieu of private household employers, the trend at the end of the 1990s was toward increasing dependence on domestic cleaning firms, child care establishments, and temporary help firms.

Controversial issues surrounding the industry in the 2000s focused on the Domestic Workers Bill of Rights. In an ongoing effort, the Domestic Workers United formed at the state capital of New York, in Albany, pushing for enactment of the bill. This marked the first statewide legislative proposal drafted by and for domestic workers. Because the domestic workforce did not enjoy protection from the National Labor Relations Act (NLRA) or the Fair Labor Standards Act (FLSA), the industry was seeking protection under the bill. There were some 200,000 women working in New York City alone--working as babysitters, nannies, housekeepers, baby nurses, cooks, housekeepers, and companions for the elderly--who did not receive regular employee benefits.

Current Conditions

A 2008 survey conducted by the International Nanny Association found that 84 percent of nannies surveyed resided off-site while 13 percent lived with their employer and 3 percent lived in separate housing provided by their employer. Of those queried, 17 percent reported that they held a bachelor's degree in a child-related major, 19 percent had two or more years of college, and 19.5 percent had only a high school diploma. Survey results in the area of experience revealed that 19 percent of nannies had 10 to 15 years of experience and 14 percent had 4 to 5 years of experience. Forty-six percent cared for two children, 29 percent cared for one child, 19 percent cared for three children, and 7 percent cared for four or more. Most (41 percent) nannies cared for children ages 3 to 5, whereas 35 percent reported their charges were ages 5 to 9; 33 percent reported they cared for children ages 2 to 3, and 22 percent cared for children ages 1 to 2. On average, 11 percent earned less than $300 a week, and 10 percent earned $500 a week. The highest per-week wage reported was $900. A majority (66 percent) of nannies that responded to the survey worked for professional couples.

The economic recession of the late 2000s negatively affected the household worker industry overall. As people struggled with finances due to the effects of the economic downturn, many household workers found themselves unemployed. According to Erin Krex of Chicago-based First Class Care, "Household help is one of the first luxuries to disappear from the budget." Another industry participant, Betsy Watson, owner of In a Pinch Inc., which hired out household staff in New Jersey, reported that business was down 30 percent in 2008. The downturn was evidenced nationwide.

Those who could continue to afford household help were subject to taxes imposed by the federal government. In 2008, employers who paid a household worker $1,700 were required to pay the "Nanny Tax." This was a slight advantage over the 2005 threshold of $1,400. Since a household employer was considered a "small business" when it came to tax laws, employers were responsible for withholding Social Security, unemployment, and Medicare taxes for household employees.


The use of illegal immigrants as household workers continued to be a major political and social issue in the 2000s. According to HomeWork Solutions Inc. as reported by Inc., "Many households employ illegal immigrants as nannies, housekeepers,[and] groundskeepers," and although some of these households comply with employment tax reporting, "the majority do not."

Earnings of private household workers varied depending on household, staff size, geographic location, and experience. Generally, full-time live-in housekeepers, cooks, butlers, nannies, and governesses earned the highest remuneration. Experienced and highly recommended workers employed by wealthy families in major metropolitan areas may earn $800 to $1,200 a week. Private household workers who live with their employers may be given room and board, medical benefits, a car, vacation days, and education benefits. However, most private household workers receive very limited or no benefits. Some workers lived with their employers and received room, board, and a package of benefits competitive with U.S. industry, but in some states employers could deduct a minimal amount for room and board, making the salaries of some household workers lower than the minimum wage.

The Department of Labor reported that 1.3 million people worked as child care workers in 2008. About 19 percent of these worked for private households. The average hourly wage for child care workers was $9.12 in 2008.

America and the World

According to the Center for Migration Studies, at least 10 percent of the United States' 3 million illegal immigrants worked in child care, with roughly another 10 percent working in other private household occupations. Legally, more than 10,000 Western Europeans worked in the United States through cultural exchange programs.

Great Britain, like the United States, reported shortages of child care help in the early twenty-first century. Because of this shortage, salaries for nannies in Great Britain increased significantly. In other European countries, child care help was largely covered by the state, reducing the need for such workers. A study by the European Economic Commission showed that Denmark, France, Belgium, and Italy offered the most generous state assistance for childcare. In Scandinavian countries, childcare was typically provided by employers.

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