COMMODIFICATION of services is one of the major avenues of expanding the realm of capital in the neoliberal age. Commodity for Marx has no reference to corporeal reality. Something which is produced for sale whether it is goods or services does not make a conceptual difference in Marx’s notion of commodity. For Marx, commodity is a social relationship independent of its physical nature. The expansion of services in the count of GDP is partly because of commodification of services which were earlier supplied from a community or collectively owned pool. There are some services which are sometimes categorised as services impacting persons such as education and health and there are some services which are termed as services affecting goods owned by the receiver of services such as maintenance of goods, cleaning, repairing, haircutting and so on.

Services are generally characterised as those activities in which separating production and consumption is difficult and services extinguish without having traces of value. There are services such as a bus ride where the act of production and consumption coincide, the production is instantaneously realised by the act of consumption. But there are services which do have long lasting impact such as health and education. Also in today’s world services are traded such as computer and business services, technical services, communication and legal services and some are embedded in global service chains. Adam Smith made a distinction between productive and unproductive labour and such a distinction is often related to a reference to services. Productive labour was considered that produces goods and creates wealth while services which are paid out of that wealth by the rich were considered unproductive. Marx’s notion of productive and unproductive labour was a radical departure from classical theory and particularly of Smith’s distinction between the two.

According to Marx, productive labour in capitalism is that one which directly produces surplus value or indirectly contributes to the creation of surplus value. Two things need to be mentioned in this context: firstly, this was not a normative position that only surplus creating labour ought to be considered productive according to Marx, rather it is the peculiarity of capital relations that considers an act as productive only when it produces surplus. Secondly, unproductive labour in the Marxian sense has no reference to the usefulness of the act. A human activity might be really useful such as caring for an elderly neighbour or running a community kitchen during the time of a natural disaster, but capitalism would recognise such activity as unproductive because it is not contributing to the production of surplus value. Therefore, the material nature of production and its use value do not actually determine whether a human activity is productive or unproductive, it is all about how that activity helps capital to grow.

PRODUCTIVE AND UNPRODUCTIVE SERVICES
Marx hence distinguishes services in capitalism as productive and unproductive on the basis of the same criterion that how such services contribute to the production of surplus. The distinguishing feature is if the service is paid out of variable capital then that labour contributes to surplus production while one that is paid out of the revenue earned is considered to be unproductive labour. In the Theories of Surplus Value Part I Marx discusses in detail with telling examples how services can and cannot be surplus producing activity.  One such example is a cook employed by a person to prepare good food for consumption and the same cook employed as a chef in a restaurant where food is prepared for sale with a view of earning profit. In the first case the cook is paid out of the earnings of the employer to serve consumption needs and in the latter the cook is employed to extract surplus by the employer and preparation of food and its taste and use is immaterial for the employer. The employer in this case is a capitalist who is interested only in augmenting the invested capital and therefore the exchange value of the food is what actually matters to the employer and the good taste of the food is nothing but a precondition to realise its exchange value.

SERVICES AND CIRCUIT OF CAPITAL
It is also important to acknowledge the role of services in the circuit of capital. Surplus value is created through the act of producing goods and services by exploiting labour. There are no other sources of surplus value other than labour power involved in the production of goods and services. But the surplus value produced has to be realised as profit through the sale of produced goods and services. This act of the sale of produce helps realising surplus value as profits. But this production and appropriation of surplus value is intrinsically linked with distribution of the produced surplus value. It would be wrong to suggest that in the circuit of capital production of surplus value is only important and the process of circulation only follows the act of production. In fact, Marx was categorical in suggesting that the complete circuit of capital’s reproduction involves production, appropriation and distribution of surplus value. The distribution and circulation also involves service activities undertaken by merchant capital, finance, advertisement, sales and storage, communication, education and training of labour and so on. These activities from the vantage point of productive capital are not surplus producing activities but they create the precondition for the reproduction of circuit of capital and production of surplus value. These are not secondary to the act of producing surplus value but are equally important in the circuit of capital. But whether such activities would be considered as productive or surplus producing or not depends on the relation in which the labour is embedded.

To the productive capital, for instance, a surplus producing manufacturing unit may involve an advertising agency and share a part of surplus or revenue for such service. From the perspective of the capital involved in manufacturing, this service helps in realisation of already produced surplus value and therefore shares a cut with the agency, but does not add to the surplus value produced. But the capital which is running the advertising agency employs labour power and squeezes unpaid labour out of the employees. Such workers in the advertising agency are involved in services, but they are to be considered as productive labour to the advertising agency owning capital as they produce surplus value. Hence there are no fixed properties of service activities that can determine productive or unproductive labour but it essentially depends on the social relation in which the labour is employed.

As human civilisation progresses consumption of goods and services is much more conditioned by not only the physical content of those goods but the ethical, cultural and aesthetic content also adds value to the product. It is not just the product but its design, its packaging, customisation, delivery, after sales services, its digital content all add value to the product. These create immense potential for the expansion of service activities. For capital such use values generate new avenues for exploiting labour and creating surplus value. On the other hand such expansion creates new proletariat who could flock with the traditional ones and contribute to the struggle against exploitation by capital. With the expansion of capital, capital relations also face its own boundaries created by the resistance of the expanding working class which includes the new group of proletariats.