Most of us probably know someone – if it’s not ourselves – who have said that it’s more economical for them to give up work entirely than juggle a job alongside costly childcare fees. The Social Market Foundation think tank points to the statistic that an estimated 10% of mums with children under three choose to stay at home rather than shell out for childcare. But is this really more cost-effective?
A recent study found that an average family needs to maintain an income of £36,000 for an acceptable standard of living (with lone parents needing £23,900) – an increase of a third since 2008. Aside from the typical costs of schoolwear, clothes, books and other essentials, part of the reason behind the increase is considered to be the rise in childcare costs.
It has been reported that the average cost of nursery care for children under the age of two rose by nearly 6% in 2011. This rise was compounded by limits imposed by the current government on the tax credits which parents in lower wage bands can claim to pay for the care.
The report, published by the Daycare Trust, found that the average cost of a part-time nursery place for a child under two years old is more than £100 a week, although this figure varies across different regions, with nurseries in London working out the most expensive. In some cases, a part-time place costs as much as £300 a week; around £15,000 a year.
Clearly, the cost is a sizeable chunk of any average adult’s yearly wage, and for those living in more costly regions, is perhaps more than they can realistically afford. In 2010, a spokeswoman for the Department for Work and Pensions said that £15,000 a year was a reasonable wage – but when that’s all potentially going towards childcare fees, that view is hardly tenable for struggling parents, and some may even find themselves facing rising debt due to the costs.
Of course, some parents may have the option of accepting extra hours or seeking additional work in order to meet these costs. However, this can have a knock-on effect in terms of their relationship with their children, robbing both parent and child of valuable time together.
Perhaps a lesser concern, but one that is nonetheless still important, is that careers can be cut prematurely short by the crucial decision to leave work in favour of becoming a full-time parent.
Although many workplaces have policies in place to accommodate parents who wish to continue their role in a part-time or flexible capacity, not everyone is fortunate enough to find themselves in such a position leading up to parenthood. The long-term expense of giving up a well-paid job that has been worked towards is one that can potentially never be repaid.
So, whilst some families struggle to juggle their finances once childcare costs are added to their monthly outgoings, some households don’t have much of a choice either way. However little their part-time or full-time work might add to the overall household income once childcare is deducted – even if it’s a negative figure – giving up work in the current economic climate might be considered by many to be a risk not worth taking.
What are your thoughts on this?
What are your thoughts on this?