A new report from accounting firm KPMG has proven what many parents have long thought of: the costs of childcare are a major barrier to mums going back into full-time employment.
And at a time of chronic skills shortages in many key industries in Australia, such barriers are arguably just as much of a hit to employers as they are to affected families.
“Our report has found that for a couple earning the minimum wage, the mother is effectively working for just $2.50 an hour on the additional days if she increases her working days beyond three a week. This is a worrying situation,” KPMG Australia chair Alison Kitchen said.
According to the firm, the problem is not isolated to just a few mothers either. It suggested that more than 125,000 Australian women are left worse-off if they work any more than three days per week.
Ms Kitchen suggested that Australian workplaces should adopt a more flexible approach to the number of days required of both women and men, but also called on the government to make changes to the Child Care Subsidy scheme.
“The subsidy (introduced on 2 July 2018), whilst commendable in its improvement over the old system, still contains anomalies that should be addressed,” she said.
“[We need to] remove some of the distortions in the tax and transfer system.”
Grant Wardell-Johnson, a partner at KPMG’s economics and tax centre, suggested that the Child Care Subsidy be made universal to stop “cliffs” at which point working mums are financially disincentivised from taking on more hours.
Last year, it was claimed that the cost of childcare is directly hindering business growth – particularly among SMEs.