Women paying ‘motherhood penalty’ as costs of childcare rise

WOMEN are being ‘priced out of work’ by the soaring cost of childcare in a ‘motherhood penalty’, a report has warned.

Mothers are losing out financially because of the price of nurseries and childminders, forcing them to work part time or quit their jobs, analysis by PwC found.

UK childcare is among the most expensive in the world, with full-time fees for under-twos setting parents back an average £14,000 a year.

Campaigners at the Women’s Budget Group said 1.7million women were prevented from taking on more hours of paid work due to unaffordable childcare costs last year.

Some figures suggest that British workers spend as much as a third of their salary on childcare. These huge costs are also a major cause of the gender pay gap, which widened from 12 per cent in 2020 to 14.4 per cent in 2021, according to PwC. This means that women on average earn 86p for every £1 a man makes.

Larice Stielow, a senior economist at PwC, said: ‘The motherhood penalty is now the most significant driver of the gender pay gap and, in the UK, women are being hit even harder by the rising cost of living and increasing cost of childcare.’

The situation appears to be getting worse. In one year, the UK has dropped five places from 9th to 14th in the PwC global index for gender equality, which includes factors such as pay gaps and full- time employment levels.

Britain sits behind the likes of Luxembourg, New Zealand and Slovenia, the top three on the index. Anna Ritchie Allan, executive director at equality charity Close the Gap, said: ‘Covid has rolled back progress on gender equality at work, and the economic recovery has left women behind as they struggle with a devastating cost of living crisis that’s hitting their pockets hardest.’

She said the UK needs more affordable and flexible childcare – and men ‘doing their fair share’ of looking after their children. Jemima Olchawski, the boss of the Fawcett Society, said the slow progress in closing the gender pay gap is ‘nothing short of disastrous’.

‘There will be no meaningful progress to close the gender pay gap until we reckon with the fact that the extortionate cost of childcare and a lack of genuinely flexible work options lock women out of the workforce,’ she said.

Chancellor Jeremy Hunt has come under pressure to deliver more support to parents in his Budget next week. But it is understood that he is set to reject a proposal from the Department for Education to provide 30 hours a week of free childcare for parents of children aged between nine months and three years.

Currently, working parents who meet certain conditions can get up to 30 hours of free childcare a week in England – but only when their child is aged three to four.

A report released last month showed that women effectively work without pay for the equivalent of almost two months a year because they earn so much less than men. February 23 was dubbed Women’s Pay Day because it marks how many days fewer a year they get paid in real terms compared to men.

The gender pay gap gets worse after a woman has children and again when she turns 50, according to the analysis by the Trades Union Congress.

‘Slow progress is disastrous’