Childcare counts

Babies and Bosses - Reconciling Work and Family Life, Volume 3: New Zealand, Portugal and Switzerland
OECD Observer

Choosing the career track versus the family track is a personal choice that has become a global concern. Family-friendly policies are essential, says Babies and Bosses - Reconciling Work and Family Life, not only to promote child development and family wellbeing, but to reduce poverty, underpin productivity and bolster employment in our ageing societies.

Policies that may contribute to balancing home and office include, for instance, low tax rates to ensure that working parents are not penalised, or public investment in childcare to make it easier for mothers to take paid jobs. The third in a four-part series that addresses family-work issues, this edition of Babies and Bosses examines the policies of New Zealand, Portugal and Switzerland. (See also the policies of Austria, Ireland and Japan in OECD Observer No 239, and Australia, Denmark and the Netherlands in Observer No 235.)

In all three countries, as in many industrialised countries, people are simply not reproducing enough. Families are getting smaller, from the low levels of 1.5 children per family in Portugal and Switzerland, to barely replacement level in New Zealand. And these countries employ more women than in most other OECD countries. In 2002, female employment rates in Switzerland (72%), New Zealand (65%) and Portugal (61%) compared favourably to the OECD average of 55%. Many of these may be working part-time, especially mothers with dependent children. More might work full-time and would have better career prospects if childcare facilities were more widely available.

That includes affordability; in Portugal, the vast majority of employed women (85%) have a full-time job, albeit at low salaries. Investment in childcare would be helpful in boosting employment in all countries, though it is costly.

Tax engineering could also encourage more job seeking. New Zealand’s new "Working for families" package, for instance, may increase incentives to work for those on income support, but, argues Babies and Bosses, the reform could encourage more women to join the labour force by cutting the high tax rates faced by the second earner in couples and squeezing some generous benefits, including to single mothers.

©OECD Observer No 245, November 2004

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