UK Childcare Costs Are Out of Control, Sparking Calls for Necessary Reform
A recent study conducted by the consultancy group PwC has found that 18-year-old women in the UK entering the workforce today will not see pay equality in their lifetimes. According to the PwC, the most significant contributing factor to the gender pay gap in the UK is the so-called motherhood penalty, more accurately described as “the loss in lifetime earnings experienced by women raising children.”
The UK is currently being plagued by a cost-of-living crisis. Brexit, the economic fallout from the Covid-19 pandemic, and the war in Ukraine have led to rising mortgage rates, rent hikes, massive energy bills, and burgeoning food costs. The childcare industry has been hugely affected as well, with anti-discrimination advocacy group Pregnant Then Screwed stating in a letter addressed to Prime Minister Rishi Sunak and Chancellor Jeremy Hunt that between March 2021 and March 2022, the number of childcare providers dropped by about 4,000, leading to cuts in funding and a rise in fees.
The PwC concludes that net childcare costs in the UK represent almost a third of the income of a family that earns an average wage. Compare that to Germany, where childcare costs represent about 1% of an average family’s earnings, and the statistics become all the more harrowing. Though there is a shared parental leave system in the UK, which was created to encourage fathers to take more parental leave and thus share the burden of childcare, it was estimated only 2-8% of families took advantage of the system in 2019, nowhere near what is needed to close the gap.
As a result, many mothers are being priced out of working at all. For lower-income families, especially, it is more affordable for women to leave work than remain employed and have to handle the rising costs associated with childcare. This leads to larger unemployment numbers in the UK as well as widening the gulf between motherhood and career progression that most women in the workforce already have to contend with.
With the UK’s Spring Budget being announced on March 15, many women and families hope that the issue of childcare will be addressed. The letter written by Pregnant Then Screwed, which currently boasts nearly 50,000 signatures, demands extensive childcare reform. They estimate that full-time childcare will soon cost upwards of £15,000 a year on average. With energy bills still set to rise as well from April onwards, the situation is becoming increasingly untenable.
The Women’s Budget Group, a thinktank promoting gender equality, has urged Chancellor Hunt to boost state spending on childcare by £1.75 billion–the estimated cost of covering the current shortfall between government funding for “free” childcare schemes and the cost to providers delivering those services. Given the UK government’s wish to reduce the number of “economically inactive” people, as well as worldwide worry over falling birth rates, ensuring that childcare in the UK is properly funded is undeniably important.
(via The Guardian, featured image: Yuri Shirota on Unsplash )
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