Childcare costs are a major factor in whether or not it is financially practical for a parent to return to work or not.
In fact, a survey has revealed that mums have to scale back their working hours when they return to work due to the expense of childcare.
Mums have to scale back their working hours due to the rising childcare costs
Analysis by KPMG found that 125,000 of working mums across the income spectrum are WORSE off by working full time each week due to the cost of sending their children to childcare.
As much as 77 per cent of mums feel that the majority of their income is going towards childcare expenses. If you take the costs of commuting to work, then it’s not always worth it.
In fact, it’s almost like mothers are paying to go to work in some cases, or earning very little per hour!
Here are the financial breakdowns from the study:
- If a couple, who both earn the minimum wage, has two young children in long day care, the family only earns an extra $929 a year from the mother increasing her working days from three to four days per week – working for just $2.50 an hour.
- If the father earns $80,000 a year and the mother earns the part‑time equivalent of $80,000 a year, by increasing her working days from four to five per week, she increases the family budget by less than $5 per hour.
- If the father earns $100,000 a year and the mother earns the part‑time equivalent of $100,000 a year, increasing her days from four to five actually costs the family $4000 a year, or 20 per cent of the family budget, actually losing $85 for every extra day that she works.
“Do we seriously think it’s fair to ask someone to be a checkout chick for $2.50 an hour when they are already really struggling?” KPMG Australia chairman Alison Kitchen told The Australian Financial Review.
“At $100,000, I get that some people will say that’s wealthy but the reality is it’s not, so to pay for the privilege of working at that sort of income level is crazy.
“At five days, she is paying $78.50 an hour for the privilege of working that fifth day, it’s just crazy.
“There are women who are choosing to do that and pay for that privilege because they think they will be discriminated against if they don’t.”
Current childcare income caps
- If annual family income is greater than $186,958, the childcare subsidy is capped at $10,190 per child.
- If a family income is over $351,248 a year then the childcare subsidy terminates.
Alison Kitchen adds: ”Too often it is women, not men, who are called on to work part-time – or not at all – while men remain in full-time roles.
“It is for everyone, including employers, to challenge these norms.”
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