Modern Australian
Men's Weekly

.

Single parents are getting priced out of daycare, triggering a vicious cycle of entrenched poverty

  • Written by Barbara Broadway, Senior Research Fellow, Melbourne Institute of Applied Economic and Social Research, University of Melbourne

Female workforce participation has risen for the past two decades in Australia, and in turn, more young kids have been attending formal childcare.

So it’s very surprising the latest Household, Income and Labour Dynamics in Australia (HILDA) Survey shows a steep fall in the use of formal childcare among single-parent households, which by and large are headed by women.

The HILDA Survey has been running since 2001, and the same 17,000 or so Australians are interviewed every year on issues such as health, family and work. The newest report, published today, is based on 2018 figures, the most recent available data.

According to the HILDA Survey, 52% of single-parent households with kids aged under four used formal childcare back in 2016. But in 2018, that share has dropped to 35%. The same trend isn’t observed among coupled parents.

While it is unclear what is driving this trend, it is potentially a sign many single parents simply can’t afford formal childcare. If so, it risks kicking off a vicious cycle in which lack of money, lack of childcare, and lack of employment opportunities trap single parents in entrenched disadvantage.

Single parents are getting priced out of daycare, triggering a vicious cycle of entrenched poverty About 52% of single parent households with kids aged under four used formal childcare back in 2016. But in 2018, however, that share has dropped to just 35%. HILDA 2020

Read more: The child-care sector needs an overhaul, not more tinkering with subsidies and tax deductions

A worrying trend

There doesn’t appear to be an obvious explanation for this phenomenon. The change in usage patterns comes at a time when childcare subsidies had just been substantially increased for the majority of low- and middle-income households, reducing their out-of-pocket expenses.

There also appears to be no reduced need for care; employment levels among single parents remained stable even while childcare usage dropped.

It may be many single parents are instead relying on informal childcare arrangements, such as relatives or friends. The HILDA data reveal a growing number of single parents with kids below school age, who have a job but no formal care arrangement.

In 2018, only 52% of all employed single parents with young kids had a formal care arrangement, compared with an average of 70% over the previous ten years.

A woman and child walk together. In 2018, only 52% of all employed single parents with young kids had a formal care arrangement, compared to an average of 70% over the previous ten years. Shutterstock

This is a worrying new trend. It sets up single parents for a host of logistical problems juggling multiple care arrangements and unreliable access to care, which can jeopardise their employment in the longer term.

And because it’s unregulated, there’s no way to enforce quality standards of informal care arrangements. That could potentially limit children’s social, behavioural and cognitive development if they miss out on formal care.

As in other countries, Australian single-parent families who don’t access formal childcare are the most disadvantaged; they are more likely to live in remote or regional Australia, and in socially and economically disadvantaged locations, and the parents in these families have lower educational qualifications.

There is a strong link between families that don’t or cannot access formal childcare, and families affected by poverty and lack of employment.

A cycle of poverty and entrenched disadvantage

HILDA tracks households over time, so we can also see each family’s circumstances and childcare usage in the year prior. When we analysed single-parent households over time, we found two important facts.

First, the falling rates of formal childcare usage among single parents isn’t just about a shift over time, in which fewer and fewer single new families begin to use the formal care sector when their child is old enough.

It is, to a large extent, about families that already had a formal care arrangement in place, but cancelled their enrolments before their kids reached school age.

And second, just before these families stopped using childcare, they tended to be somewhat poorer than their counterparts who continued to use it — but not as poor as the families are who don’t use childcare in the long run.

In other words, there could be a vicious cycle whereby lack of income (whether because the single parent is unemployed, or employed on a low wage) prompts families to drop childcare, further worsening their economic position down the track because work opportunities are more constrained. It’s hard to maximise work opportunities if you don’t have reliable childcare.

A woman works while holding a baby. It appears that even after the recent increase in subsidies, our childcare system is badly set up. Shutterstock

The HILDA Survey had already shown a substantial increase in relative poverty rates among single-parent households — from 15% in 2016 to 25% in 2018, well above the 10.7% overall rate of relative poverty.

Given the devastating effects of COVID-19, we can expect the number of single-parent families that enter a cycle of poverty and entrenched disadvantage will only grow further.

It appears that even after the recent increase in subsidies, our childcare system is badly set up to help them find a way out.

Read more: Interactive: how have your family's fortunes changed? Use this drag-and-drop tool to find out

This piece was co-published with the University of Melbourne’s Pursuit.

Authors: Barbara Broadway, Senior Research Fellow, Melbourne Institute of Applied Economic and Social Research, University of Melbourne

Read more https://theconversation.com/single-parents-are-getting-priced-out-of-daycare-triggering-a-vicious-cycle-of-entrenched-poverty-150362

Comfort and Style with Ceiling Fans Perth

While air conditioning is common, it is not always the most cost-effective or sustainable solution, particularly during long hot summers. For homeow...

How Professional Air Conditioning Services Improve Comfort and Efficiency

Air conditioning has become a fundamental part of homes and businesses, providing relief from sweltering summers and keeping interiors warm in winte...

The Value of Professional Rubbish Removal Services

From everyday waste to bulky items like furniture and appliances, finding the right way to dispose of rubbish is not always straightforward. This is...

Why Ugly Websites Sometimes Outperform Beautiful Ones

In the digital age, we're constantly told that first impressions matter, and nowhere does this seem more apparent than in web design. However, a cur...

TPD Claims & Super: What Does It All Mean?

Many Australians hear the term "TPD" in relation to their superannuation and feel completely lost. If you're scratching your head, wondering what it...

What Does Breastfeeding Feel Like? A Guide for New Moms

Frequently, numerous new mothers wonder, "What does breastfeeding feel like?" The feeling is different for each individual - a few describe it as a ...

Best Nail Care Routine for Frequent Nail Polish Wearers

For many people, nail polish is more than a beauty statement – it’s part of their everyday routine. Whether you love bold colours, chic neutrals...

Reinventing Research: How E-Libraries Are Changing Education Forever

A New Chapter for Learning For centuries libraries stood as temples of knowledge filled with shelves that smelled of dust and paper. Today the same...

Psychologists Explore Gestalt Vs Schema Therapy for PTSD Treatment

Recent research has revealed that in 2022, 1 in 9 Australians experienced post-traumatic stress disorder (PTSD). For some, this can significantly im...

Beyond Sunscreen: Building a Sun-Smart Culture in Modern Australia

Australia’s sun-soaked lifestyle is a defining part of its national identity. From beaches and sports fields to weekend barbecues and bushwalks, t...

What is Power BI & Why Should Your Business Use It?

In today's data-driven world, businesses are constantly searching for ways to gain a competitive edge. One tool that has emerged as a game-changer i...

From Service to Strength: How Aussie Veterans Are Rebuilding Their Lives with Everyday Support

Life after military service can bring new challenges. From physical limitations to mental health hurdles, many Australian veterans find everyday hou...

The Best Times of Year to Buy a Caravan

If you're shopping for caravans for sale, timing matters almost as much as the layout and features you desire. The calendar shapes price, stock and ...

The Growing Demand for Smart Living Through Home Automation

Technology has reshaped how we communicate, work, and travel—but now, it’s also changing the way we live at home. The rise of home automation i...

Beyond Clicks and Likes: Why Many Small Businesses in Australia Still Aren’t Leveraging Digital Marketing in 2025

Introduction In 2025, online marketing has become the driving force behind business growth for companies of all sizes. Yet, despite its proven effect...

Lighting Shop Perth: Your Comprehensive Guide to Choosing the Right Lighting Solutions

Lighting is a fundamental element in defining the ambiance, functionality, and aesthetic appeal of any space. Whether you are renovating your home, ...

Private Booze Cruisers – The New Must-Have Toy for Cashed Up Millennials

Did you hear that your 30s are the new 20s? We’ve finally rocked up that adult money and now it’s time to play with it. I was going for a walk ...

Grinding & Jaw Soreness: Signs You Might Need Night Guards and How We Protect Enamel

Waking with a tight jaw, tender muscles, or a dull temple headache is more than a bad night’s sleep. Many Australians grind or clench their teeth ...