Childcare costs rise up to seven times faster than wages

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Childcare costs for young children have risen up to seven times faster than wages since 2008, a study suggests.

TUC research shows that average costs in England for parents with a one-year-old rose 48% between 2008 and 2016, while average wages increased 12%.

London and the East Midlands saw the biggest increase – childcare rose seven times faster than pay, the study said.

The government said it had doubled the free childcare available to working parents of three and four-year-olds.

The trade union body, the TUC, said that, while parents with children aged two and above received financial support from the government, most working parents with one-year-olds did not get any state help.

TUC general secretary Frances O’Grady said: “There is a real gap in childcare support for one-year-olds until government assistance kicks in at age two.

“Parents need subsidised, affordable childcare from as soon as maternity leave finishes to enable them to continue working, and so mums don’t continue to have to make that choice between having a family and a career.”

The TUC said parents are spending an increasing amount of their pay on childcare. The figures suggest that two parents working full-time, with a one-year-old in nursery for 21 hours a week were typically spending 11% of their wages on childcare in 2016, up from 8% in 2008.

Ms O’Grady said that the picture for single parents was “even worse”.

Single parents working full-time, again with a one-year-old in nursery for 21 hours a week, spent, on average, more than a fifth (21%) of their wages on childcare last year, up from a sixth (17%) in 2008, the study said.

‘Working doesn’t pay’

Childcare costs, according to figures from the Family and Childcare Trust, increased most in the West Midlands (67%), followed by the East Midlands (64%) and the North East (62%), while the smallest rise came in the east of England (35%).

Robert Goodwill, the Children and Families Minister, said the government had saved parents “thousands a year” and helped them “get back into work” by doubling the free childcare available to working parents of three and four-year-olds to 30 hours a week.

Ellen Broome, chief executive of the Family and Childcare Trust, said the cost of childcare meant “it does not pay to work” for many parents.

She said low-income families claiming universal credit typically take home £1.96 per hour after childcare costs have been paid.

‘Astronomical costs’

Helen Bryce, who works full-time, told BBC Radio 5 live that childcare was a “constant juggle”.

She said her husband was taking a career break to spend time with their children and they also used a childminder.

When they used a nursery, she says, the costs were “astronomical”.

“I know at one stage we had our children, we had three young children, all in nursery part time. Our costs were over £1,500 a month, which was more than I was making.

“Obviously this isn’t just a women’s issue, childcare is a family responsibility but still it was a massive drain on our family income.”

Mother-of-three Ellie Thouret says childcare costs are the reason she is a stay at home mum.

“When I had my twins we realised it was going to be absolutely pointless for me to go back to work,” she said.

“We looked at the sums and the cost of the childcare for three children under three would have just been crippling.”

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