For everyone The motherhood penalty: the case for accessible early childhood education and care

At the end of January, the Australian Competition and Consumer Commission (ACCC) published a report that was music to the ears of the 80,000 parents and carers in The Parenthood community. In 13 words, the ACCC’s final report for the inquiry into early childhood education and care captured what parents and educators know all too well: that “market forces alone are not meeting the needs of all children and households”. On the key objectives of accessibility and affordability, “current regulatory settings are not delivering”.

Since The Parenthood, a not-for-profit advocacy organisation, was formed back in 2013 to give voice to parents and caregivers, one of the most universal obstacles our community has united around is how wildly unaffordable and inaccessible early education and care is.

In October last year, we polled more than 1,200 parents in Australia with children under six, and the findings were sobering. Almost two-thirds (62%) said they were struggling financially. Only three in 10 parents who use long daycare found the costs easily manageable. Of those under general financial pressure, childcare costs were of particular concern.

Most parents (85%) surveyed said the cost of living means that their family doesn’t have a choice about working arrangements – both parents need to work. This rises to 90% for those under financial pressure. Six in 10 reported that they or their partner would work different hours if childcare wasn’t so expensive.

To have these issues acknowledged and validated by the ACCC was a relief. For the 30% of families around Australia who live in ‘childcare deserts’ – where there are three or more children for every available position in early learning and care – affordability is moot. For those lucky enough to have access to a position, the average fee is $136 a day, which adds up quickly, even with the subsidy.

In Australia, average wage-earners with two children in full-time care spend 24% of their earnings on childcare, even after subsidies.

The ACCC found “the price of childcare significantly impacts how much childcare households use”. And, in Australian households, it tends to be the employment of mums that is most affected by the cost or the lack of early education and care. 

In Australia, average wage-earners with two children in full-time care spend 24% of their earnings on childcare, even after subsidies. This is much higher than countries such as Sweden (5%) and Germany (1%). This explains why Australia has an unusually low female workforce participation rate and a high rate of part-time work – despite being a world leader in the education of women and girls.

In all countries, mothers are less likely to be employed, more likely to work part time, and for a lower rate of pay. But, in Australia, the ‘motherhood penalty’ – how economists describe the hit to a woman’s earnings after having children – is especially huge, at 55%, and the average loss lasts at least 10 years. This is much higher than in comparable OECD nations.

Not only is it transformative educational and social policy, affordable early childhood education and care (ECEC) delivered by a well-paid and qualified workforce is one of the most effective ways to redress the motherhood penalty. Campaigning for universal access to quality ECEC, plus adequate and equitable paid parental leave and family-friendly workplaces, is The Parenthood’s priority.  

The market model of ECEC is not only failing families, it isn’t delivering for early childhood educators.

There is an extraordinary amount of work to do, but this reform is getting closer to reality than rhetoric than at any other point in Australia’s history. Almost every state and territory is committed to the provision of universal three- and four-year-old preschool. Since taking office, the Albanese government has maintained its commitment to plot a path towards universally accessible and affordable ECEC.

Between October 2022 and February 2023, both the ACCC and the Productivity Commission were directed to undertake inquiries into ECEC. Throughout, the Commonwealth government has been explicit about wanting to pursue this reform, for two reasons: the education and development of children and to achieve economic growth; and increased productivity through enabling greater workforce participation among women.

The market model is not only failing to meet the needs of families. It isn’t delivering for early childhood educators, who are leaving the profession in droves because they cannot afford to stay. A substantial correction in wages for EC educators is essential; as is the provision of ECEC in rural, remote, and regional communities; and ensuring access for other children currently missing out.

It’s impossible to overstate the benefits of truly universal, high-quality and inclusive early childhood education and care. If seeking ways to shrink the gender gap, reduce inequity, give all children the opportunity to thrive, boost national productivity, and create a more sustainable future – universal ECEC is a policy unicorn. If this speaks to you, join The Parenthood!

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