Childmind the gap: Reforming childcare to support mothers into work

Maternal employment rates are important. Families where parents work experience a significantly lower risk of child poverty. Mothers who are able to work, or return to work, reduce their 'motherhood pay penalty', the fall in earnings that is linked to the length of the break in economic activity following childbirth. In addition, maternal employment has been positively linked to child development, and to parents' health and wellbeing.

Increasing maternal employment rates also provides benefits to the public purse. For example, increasing overall maternal employment by five percentage points (up to 62 per cent) would be worth around £750 million annually in increased tax revenue and reduced benefit spending. Increasing the proportion of mothers who are working full-time rather than part-time by five percentage points (up to 52 per cent) would be worth around £700 million a year.

Overall, many mothers say that they do want to work and/or increase their working hours, but repeated parent surveys have found that one very significant barrier is the lack of affordable childcare, and/or the lack of flexibility in the work that is available.

Despite having relatively high female employment rates, the UK has comparatively low maternal employment rates. Studies that assess the impact of different areas of family and social policy on employment rates consistently find that the degree of public support for childcare is a significant determinant of maternal employment rates. Countries with greater enrolment rates in publicly funded or provided childcare also have higher maternal employment.

Our report suggests that the UK should be working towards three main priorities:

• More affordable childcare for mothers with children aged up to two, for low-skilled and for lone parents, in order to enable them to enter, or re-enter, employment.
• More affordable childcare to parents of three- and four-year-olds and families where mothers are already in work, in order to enable mothers to increase their working hours.
• A system that is supply funded and more affordable for parents: childcare should account for around 10 per cent of a family's disposable income.