Olivier Thévenon

INED

Brussels - EFSI 7 november 2014

The role of childcare services on family and work outcomes

Outline

1. The provision of childcare service as a component of family policies

2. Childcare services: a key role to reconcile work and family

>0 influence on female labour force participation, fertility and child development

3. Collective returns from investments in childcare services?

4. Conclusions

Focus on childcare services• CC services include : childcare at a day-care centre, childcare

by a professional child-minder at child's home or at a child-minder's office, and education at pre-school or equivalent (e.g. kindergarten, nursery school, assilo nido).

• Different approaches to the development of childcare and education services, because it is a policy area at the intersection of :

– Child Well-being and development (cognitive and non-cognitive skills – emotional, conative skills)

– Alleviation inequalities in performances at school due to social inequalities and/or to poverty

– Work and family life reconciliation (with concerns about the development of female employment, gender equality and fertility)

Public spending on family benefits % of GDP

Public spending on families has increased in many OECD countries since 2001

Source: OECD Family database

0,0

0,5

1,0

1,5

2,0

2,5

3,0

3,5

4,0

4,5Cash benefits - 2009 Benefits in kind - 2009 Tax breaks for social purposes - 2009 2001

2000 2 2010 3 2000 2 2010 3

Public spending on childcare and preschool for children aged 0-5 years 0,5 0,7 0,3 0,4Childcare enrolment rate among children aged 0-2 years 20,5 32,6 15,2 17,8Childcare and preschool enrolment rate among children aged 3-5 years 70,8 76,9 23,7 20,5 +22/29

OECD average OECD standard deviation OECD change 1

2000-10 3

+30/33+22/22

Slight average increase in expenditures in ECEC services, but huge increase of participation rates of children under 3 years of age

Source: Adema W., Ali N., Thévenon O. (2014), “Changes in Family Policies and Outcomes: Is there Convergence?”, OECD SEM Working Papers, 157, OECD Publishing.

0,00,20,40,60,81,01,21,41,61,8

2009 1998

Public spending on childcare and preschool services

Percentage of GDP for children aged 0-5 years

Source: OECD Family database

Variations in spending for children under age 3, and children of preschool age (3 to 5)

Den

mar

kIc

elan

dF

ranc

eS

wed

enF

inla

ndB

elgi

umN

orw

ayB

ulga

riaR

oman

iaH

unga

ryN

ew Z

eala

ndLa

tvia

Italy

Mal

taLi

thua

nia

Mex

ico

UK

Cze

ch R

epub

licS

love

nia

Net

herla

nds

Spa

in

Slo

vak

Rep

ublic

Por

tuga

lLu

xem

bour

gA

ustra

liaE

ston

iaG

erm

any

US

Cyp

rus

1,2

Japa

nA

ustri

aP

olan

dIre

land

Sw

itzer

land

Kor

eaC

anad

aG

reec

e

0.0

0.2

0.4

0.6

0.8

1.0

1.2

1.4

1.6

Childcare spending as a % of GDP Pre-primary spending as a % of GDP% GDP

Source: OECD Family database

Differences in coverage rates of services for children under age 3.

0

20

40

60

80

Percentage of children in formal care or pre-school FTE

Source: OECD Family database

Family policy regimes across the OECD

Source: Thévenon (2011), « Family Policies in OECD countries: A Comparative Analysis », Population and Development Review, 37(1):57-87.

Key role of childcare services in the policy mix• A positive influence of childcare service coverage for children

under age 3 on female labour force participation→ From 1980s to 2007, large effect of increase in CS coverage on the

trends in FLFP (Thévenon, 2013) : an increase of 0.2 percentage point in the coverage of childcare services has produced a 2.8 per cent increase in female labour force participation rates.

→ greater effect in countries with comparatively long paid leave and/or a high degree of employment protection.

→ but its effect varies across family policy regimes: – stronger in Nordic and English-speaking regions (and supporting full-time work in

the North); – weaker in continental and southern European countries where the expansion

childcare services may have merely changed informal into formal provision and have made it somewhat more likely for women to work part-time work.

→ seems to have had an impact only for medium and high educated women (Cipollone et al., 2013)

• A positive influence of childcare service coverage on fertility trends→ The effect of coverage of childcare services for children under age

three on fertility rates is found to be positive in all welfare states (Luci-Greulich and Thévenon, 2013)

• A positive influence of early enrolment in care and education services on child development→ Clear evidence on the positive effect on performance at primary

school→ Long-lasting effect? expansions of early education generally yield

benefits at school entry, adolescence, and for adults particularly for disadvantaged children (Ruhm and Waldfogel, 2011)

2 examples: For France: Dumas and Lefranc evaluate long-term effects of the preschool expansions that occurred in the 1960s and 1970s (a period when the share of 3 year olds enrolled in preschool rose from 35 percent to 90 percent, while the share of 4 year olds enrolled grew from 60 percent to 100 percent: • positive impacts of preschool on grade repetition, test scores,

high school graduation, as well as on adult wages. • These effects are particularly large for children from

disadvantaged or intermediate (rather than advantaged) backgrounds

For Norway: Havnes et Mogstad (2011) find that the strong expansion of childcare provision in the late 1970s had a positive influnece on school performance, labour force participation and reduced welfare dependency.

Collective economic benefits from investments in childcare services? One evaluation for Austria

• Investing in childcare services is key for economic development since it has a positive influence on a set of interdependent employment and family outcomes

• Big concerns about cuts in spending on childcare services, as done, for instance in the Netherlands where public spending in this sector rose from 667 million euros in 2006 to a peak of 3.3 billion in 2010 before dropping back to 2.3 billion in 2013. At the same time, the number of children covered by childcare services dropped from 52% of children under age 3 in 2010 to 48% in 2013.

Conclusions

• Further reading:• Thévenon, O. (2013), "Drivers of female labour force

participation in OECD countries”, OECD Social, Employment and Migration Working Papers, No. 145, OECD Publishing, Paris (www.oecd.org/els/workingpapers).

Thank you for your attention!