Childcare costs ‘keeping mothers at home’

Seán McCárthaigh

Irish Small and Medium Enterprises Association (ISME) yesterday blamed the ongoing crisis in childcare for serious problems experienced by employers in filling vacancies.

ISME claims an exceptionally large number of highly qualified females are opting to stay at home due to a combination of inadequate and expensive childcare facilities.

The organisation’s chief executive, Mark Fielding, said the increase in female participation in the labour market was lowest among the 25-45 age group over the past five years.

Small businesses were finding it increasingly difficult to recruit staff because of the number of women who had left the workforce to have children.

Mr Fielding said employers were having to rely on immigrants to fill vacancies as the labour market continued to tighten with a consequent, upward pressure on wage levels. Business leaders have estimated that a further 250,000 migrant workers will be needed in the Republic over the next five years to maintain current economic growth.

“It is extraordinary that there is a ready supply of labour on our own doorstep that we cannot tap into, and consequently need to recruit 50,000 migrants annually to satisfy labour demand,” said Mr Fielding.

Employers say childcare costs, which are among the highest in the EU, are one of the main reasons why a large number of mothers are choosing to stay at home. instead of returning to the workforce.

Research conducted by ISME shows the average weekly cost of childcare is 180 per child. The figure is over three times the EU average and represents 38% of a worker’s average take-home pay.

Mr Fielding pointed out that many families spend more on childcare costs each month than on mortgage repayments.

He said recent figures supplied by the Central Statistics Office showed there were 546,000 women who classified themselves as working in the home.

“This is a massive, potential labour force that is untapped and would surely be used if childcare facilities were made available,” said Mr Fielding. ISME also highlighted how EU countries like Sweden and Denmark, which had invested heavily in childcare policies, had much higher female participation rates in the labour market.

The group has recommended that employers should be allowed to give tax-deductible subsidies to staff towards childcare costs which would not be considered as benefit-in-kind payments.

It also urged the Government to introduce a range of tax breaks towards the cost of building and operating childcare facilities.