The hidden price of UK childcare costs

Child-care costs have been making the headlines more than usual recently after being a major feature of the Chancellor’s Spring Budget.


It’s no secret that the cost of childcare in the UK to be blunt, is extortionate. In fact, recent research found that in 2022, the UK became the most expensive country for childcare across the developed world.[1]


UK parent’s can expect to spend up to a third of their income on childcare and 1 in 3 who participated in the survey relied on some form of debt to cover it.


As the cost of living continues to rise, the high cost of childcare is placing even greater financial strain on households and forcing many to make the decision to stay at home.


As a developed nation, how can we justify making parents choose between childcare and working full time and what impact is this having on our society as a whole?



  1. Lack of choice


The high costs attached to childcare simply removes the choice for so many women. They cannot afford to return to work even if they wanted to. This is true for about a third of mothers who are out of work caring for young children.

In addition, 50% of part-time working mothers say they want to work more hours but it’s not financially viable. This lack of choice is adding to many other social-inequalities including the gender pay gap and childcare poverty.


  1. A smaller workforce

In a time where job vacancies out-weigh the labour market, businesses have never been more desperate for talent, yet high childcare costs are forcing people out of the labour market.


A study found that only 24% of returned from maternity leave to their pre-maternity hours, while 57% left the workforce altogether.[2]


If there was more support for working mothers to return to work, the benefits would be widespread, not just through increased diversity but a much larger talent pool for businesses to thrive upon. In turn, this could drive up performance, whilst giving working mother’s a stronger sense of purpose both in and out of the workplace.


  1. Long-term wage scarring

The SMF, a cross-party think-tank, revealed that a woman who had her first child in 2010/11 typically suffered a cumulative income loss of £66,434 over the following nine years, relative to what would have happened if she had remained childless. 


The income loss figure measures the money a woman would have earned if her career had progressed in the way that similar women without children earn. Being overlooked or simply lacking confidence because of being out of the workplace due to being a parent is something women in particular, have to contend with.


Not only does this widen the pay gap, it reinforces the notion that women in particular can’t have both a successful career and bring up a family – it’s one or the other.


  1. Less diversity

With barriers preventing women from returning to the workforce post-children, there becomes less female representation in the most senior roles. This can lead to unconscious bias, further enforcing the very challenges that are holding working women back.


We know from decades of research that businesses benefit from diverse and inclusive voices so by marginalising such a large proportion of their workforce is damaging from a range of perspectives including performance, profit and future growth.


  1. Setting an example


The high-cost of childcare in the UK disproportionately affects women and is un-doing so much of the work society has done to create fairer, more equal opportunities. Removing the choice for so many families, widening pay and pension gaps, not to mention the mental health challenges this puts on parents – what example are we setting to future generations?


As a nation we’ve talked endlessly about work-life balance but what about the families who are forced to do overtime or work multiple jobs just to stay afloat?


A fair, affordable childcare system would empower employees to succeed, to be better at work and be better parents.


What do you think is the solution to the broken childcare system?


Do the Government’s latest plans go far enough to alleviate the pressure on working parents?


We’d love to hear your thoughts – follow the conversation on our social media.