17 April 2020
COVID-19 has created unprecedented social and economic change. The broadscale closure of recreational activities and entertainment venues due to mandated social distancing regulations have transformed our social and economic lives to mere online operations. Some are fortunate enough to have retained their jobs and are working from home; many others no longer have a job, let alone a workplace.
Parents who were suddenly confined to their homes and worried about their family’s health began withdrawing their children from early education and care services in significant numbers. Some outside school hours services were empty while early learning services were at 30 per cent capacity. By 24 March operators across the country were facing dire financial circumstances.
While the funding matrix for early childhood education and care services is notoriously convoluted, the simple premise is that without children the government subsidies, that cover costs like rent and supplies, evaporate. In the absence of an enforced closure of services, many providers found themselves in a position that was not viable.
All of this was trending toward having a cataclysmic impact on the provision of early childhood education and care and by extension, the national economy.
The widespread closure of early childhood education and care providers and outside school hours care providers would have had a devastating impact on families and essential workers. Those working in health and community services, transport and logistics, or supermarkets would have had limited options to turn to given informal options such as grandparenting were risky for the elderly.
Crucially, it also would have had meant economic recovery was delayed primarily because the re-entry of women into the economy would be delayed. To get to this point, it’s worth exploring the dynamic roles that early childhood education and care play in the economy; the provision of formative education, jobs and training for staff and job facilitation for parents.
Women’s entry, retention and return to the labour force has been the significant demographic game changer for the Australian economy over the past forty years. From a life that was socially predestined to being a homemaker, where ‘the marriage bar’ meant employment was terminated upon marriage and later upon having children, to being legally entitled to only 75 per cent of their male co-workers’ wage, the shift in the economic profiles of women has been substantial. Today, young women in the workplace are the most educated cohort of workers in our modern history and the contribution of women to the economy has been estimated to have added 22 per cent to GDP since 1974. Our national prosperity is inextricably linked to women’s participation.
When the Commonwealth first became financially involved with the provision of childcare in 1972, it was envisaged that such centres would “benefit children from low income and other special needs families”. A grand sum of $5 million was set aside as part of the ‘72-‘73 federal budget to enable centres to provide reduced fees for parents and staff subsidies. Today the budget allocation for the Child Care Subsidy (the means-tested subsidy paid to support parents via providers) is more than $8.2bn and the number of children enrolled in early childhood services has also ballooned to almost 1.3 million across more than 860,000 families. While some originally criticised these services as facilitating the breakdown of the traditional family unit, early childhood education is now largely accepted as a significant contributor to the education and wellbeing of children.
Which brings us back to the impact of an imminent and widespread closure of children’s services operations. Its role in facilitating economic participation would have been acutely affected; not only for the nearly 200,000 educators (95 per cent of whom are women) who work in the sector but also for the strong majority of families where women are not the breadwinner and therefore most likely to remain at home with children in the absence of services. Women, as a cohort, would be set back decades; those with children in school would likely work truncated hours to make the morning and afternoon school runs and many with younger children would have been simply unable to work while the sector was rebuilt.
While the announcement of free early education was welcomed by parents, providers are yet to see how their services will be affected by the announcement and growth in demand. It should be obvious however that when the shut-down ends, the last thing an economy on life-support will need is an entire demographic delaying their re-entry to the workforce. With some luck, the close call experienced by providers due to COVID-19 will lead to an awakening where the value of early childhood education and care educators and the role they play in the lives of our families and children is collectively recognised.