It is claimed the cost of childcare is forcing women out of work.
The National Recruitment Federation (NRF) says Ireland is one of the most expensive countries in the world for childcare - with parents forking out €622 a month.
They are calling for it to be subsidised for one and two-year-olds ahead of the budget.
Frank Farrelly is President of the NRF - and says the cost is particularly affecting working women.
"It just makes no economic sense for many people to work and it's impacting the workforce and recruitment due to the lower participation rate of women and this has amplified the talent shortage
"While many might make the choice to work in the home, there are many women who would prefer to work.
"Due to the cost of childcare their talent and skills are missing from the workforce and this is accross all sectors."
Women in Ireland over the age of 35 have lower participation rates in the workforce than their EU counterparts, where a higher rate of female participation would mitigate the labour shortages that threaten competitiveness, according to the NRF President.
“Childcare, essentially its provision and cost, and aspects of the social welfare system that discourage jobseekers from taking up part-time work, are the main issues to address if women are to be supported in going back to work”, Frank Farrelly claims.
In other countries, childcare costs are heavily subsidised by the State. But the lack of availability of affordable childminding and after-school childcare in Ireland is contributing to low rates of participation by women in the workforce, the NRF report says.