The Care Economy: A Powerful Entry Point for Increasing Female Employment

By Eliana Carranza

Thu, 07/06/2017

Access to affordable childcare is critical to increase female labor participation because the burden of childcare and elderly care falls disproportionately on women. Photo: Rama George-Alleyne / World Bank

Promoting female labor force participation and the quality of women’s employment was one of the main topics of the latest G20 Ministers of Labor meeting, as we explained in this blog. The solutions to reducing labor gender gaps across the world lie in many corners, but a well-functioning care economy is especially crucial. Nowadays, the burden of childcare and elderly care almost always falls disproportionately on women: Married women spend 14 to 42 percent of their non-leisure time on childcare, compared with 1 to 20 percent for married men. And changing demographics, aging societies, and declining fertility rates also make the burden of elderly care a growing challenge.

Children are the workforce of the future, and investing in high quality and affordable childcare thus lays the foundation for our future. Many countries are aware of this emerging need, and they have reviewed their National Employment Plans (NEPs) to include actions aimed to improve the care work. In developed countries, well-designed active labor market programs (counseling, training, wage subsidies, support to entrepreneurship), combined with instruments such as parental leave, the provision of childcare services, and flexible work arrangements can be effective.

But in developing countries, where women’s jobs also tend to be concentrated in the informal sector, these policies may not reach many. We need to think a bit differently. Three things need to happen:

1) Expand the provision of care services to vulnerable groups including in rural areas.

This cannot be done by the public sector alone, and we need to rely more on private providers. This requires proper regulations to set proper quality standards and contracting and payments systems that focus on results. Subsidies to promote investments in the delivery of these services may also be needed, with the services themselves often an important source of jobs.

2) Make the services affordable for all.

Subsidies may be required to ensure that all women --regardless of their level of income-- can afford the services. Research from countries as diverse as Brazil, Canada, Kenya, and Romania suggests that mothers are more likely to use formal childcare arrangements and enter the labor force when free or low-cost childcare options are available. Childcare vouchers are a proven mechanism to do so (as illustrated by Estancias Infantiles in Mexico). Other options for publicly provided day care are either to lengthen the school day (particularly at grades where attendance is only for half of a day) or to lower the age at which children enter the education system. In Mozambique, a randomized evaluation found that having children attend preschool centers in rural areas increased caregivers’ probability of working in the 30 days prior to the survey by 26 percent, and it even increased 10- to 15-year-olds’ school attendance by 6 percent.

3) Create better opportunities

But without the creation of better job opportunities for women, these programs might have limited impact. We need incentives for private investments within specific regions and towns, sub-sectors and value chains conditional on the creation of jobs for women.

If policy makers would like to move the needle on increasing female labor participation rates, access to quality, affordable childcare is critical. In this area, partnerships with the private sector could also create new approaches, and, also, generate new jobs.

This post is part of a series in preparation of the G20 Leaders’ Summit, featuring four topics: the future of work, employment for women, integration of migrants in the labor market, and ensuring decent work in supply chains.