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More women in the workforce makes a stronger economy, but we need to solve childcare costs

(Photo credit: FatCamera/iStock.com)

Women in the workforce, gender equity, but necessity of daycare

When Prime Minister Trudeau unveiled the first gender-balanced cabinet in Canadian history — “because it’s 2015” — it signalled that gender equality would be front and centre in his government’s policy decisions.

The 2018 Federal Budget seemed to echo this promise, with measures to decrease the wage gap and increase opportunities for women in the workforce. Narrowing the gender wage gap is smart for the economy, says Trudeau, who has attributed Canada’s economic growth to “women entering into and changing the workforce.”

Some ways the budget is addressing that gap

  • $1 billion will be added as a refundable tax credit in the Canada Workers Benefit, to supplement low-income workers, who are usually women.
  • $31.8 million will be used over three years to support newly immigrated women as they look for work.
  • $1.4 million in financing will be made available to women entrepreneurs through the Business Development Bank of Canada, to increase accessibility to capital.
  • $19.9 million in apprenticeship grants will be available for women in trades over the next five years.

Many of the incentives are good measures to get more women working, but there is a huge blind spot in the budget — child care. In a blog post by University of Toronto economist Gordon Cleveland, a leading researcher in child care policy, he says “the cost of child care is a major barrier to increased labour supply, to gender equality in employment, and to children gaining positive experiences in child care.”

Canada among most expensive for child care

The Organization for Economic Co-operation and Development monitors 35 developed nations in the world, and concluded that Canada is one of most expensive countries for child care. On average within the monitored countries, a two-parent household spends 15 per cent of their income on child care. But in Canada, that can range anywhere from 22-30 per cent annually.

Largely based on Cleveland’s research, the Ontario Liberals propose to offer free full-day daycare by 2020 for children aged two-and-a-half through to kindergarten enrollment, if they win the June 2018 election. In British Columbia, the NDP is also proposing their own plan for the future: the Child Care BC program could see some families paying $10 a day for daycare.

What are other countries doing?

Sweden

Sweden’s Educare system is often revered as the gold standard for child care. Educare combines child care and education through a subsidized network of preschools throughout the country. Parents, working or not, can begin using the system as soon as their child’s first birthday. The preschools are open from 6:30 a.m. to 6:30 p.m., and fees are proportional to income, capped at $300 each month. According to the OECD, the average family in Sweden spends four per cent of their income on child care.

Portugal

School hours are from 9 a.m. to 5:30 p.m. to mimic the traditional work day and decrease the need to find external child care options. In the last two hours of the school day, children participate in sports, music lessons and even English lessons. If additional child care hours are required, there are both state-funded and income proportionate options.

Slovenia

Similar to Sweden’s universal child care system, it costs less than $500 a month to enroll a child in daycare in Slovenia. If there is a second sibling, their fee is only one third of the first, and the third child can be enrolled at no cost at all.

As the cost of child care continues to increase in Canada, it’s poised to be a significant deterrent to individuals joining the workforce. Costs go up with each child, and for some families it becomes more financially viable for only one parent to be in the workforce. To truly increase gender equality in the workplace and grow the economy, the budget needs to address child care.

Sayada Nabi is a Toronto-based journalist who writes human interest stories focusing on entrepreneurship, businesses development and social change. She is a graduate from the University of Toronto with a Bachelor of Arts in Journalism and Media, and currently is a Master of Management Candidate at the Schulich School of Business in Toronto.