Market-based childcare & maternal employment: a comparison of systems in the United States & United Kingdom

Abstract

A vast literature has identified the importance of childcare for understanding cross-national variation in women’s employment, and has particularly emphasised the role of the state in ensuring the delivery of services. This thesis explores variation within market-based childcare systems in order to understand how systems with less state provision may support or constrain maternal employment. The thesis argues that understanding whether childcare markets ‘work’ or not in supporting maternal employment requires a deep understanding of the interplay between market and state, as the specific policy approach taken can shape the structure of the market in profoundly different ways. This issue is explored via comparative case studies of the United States and the United Kingdom, two countries known for their market-based approach to childcare, but with stark and persistent differences in maternal employment behaviour, especially working time. Drawing on a mix of qualitative (policy documents) and quantitative (national statistics) data, the US and UK systems are compared along a series of dimensions comprising the two key components of the market-based system: the structure of market provision and the policy approach. The similarities and differences of these systems are analysed through the lens of the characteristics of services known to be important for the use of care for employment purposes: availability, cost and quality. The United States and United Kingdom have generally similar childcare systems when compared to other countries which rely more heavily on the state or the family to ensure childcare provision, which is in line with their common characterisation as liberal welfare regimes. However, there are important differences in the structure of their childcare markets which affect their ability to support maternal employment: for example, the US market poses fewer affordability constraints for maternal employment given the availability of relatively low cost care provision (albeit of questionable quality); the UK market in contrast provides care at higher cost, although this is likely of better quality. This variation in market provision is shaped by differences in the policy approach taken by each country: the US approach is primarily designed to soften the rougher edges of the market in what is otherwise considered a private sphere; in contrast the UK approach actively attempts to shape the childcare market into a system in line with policy goals. The consequence of this is that the US approach does not prevent a wide range of market provision from forming to cater to diverse tastes and budgets, but this necessarily includes a substantial degree of lower quality care. The UK approach more actively constrains the types of provision which are available, which on the one hand reduces supply and contributes to higher cost provision, but also sets higher standards for care provision. Together these findings suggest that understanding how market-based care systems do or do not support maternal employment requires not only an appreciation of the broader institutional context in which they are situated, but also the intended and unintended ways that policy-making can shape their structure.