Childcare support boosts women’s wages and career

Top-down approaches such as gender quotas for women on boards will only be successful if accompanied by bottom-up support such as childcare help which enable women to climb the career ladder, according to a new study.

The study by Vidhi Chhaochharia from the University of Miami is based on research in Germany. It found that government-provided childcare allows women, and particularly mothers, to earn higher wages and climb the career ladder more easily.

The study will be presented at the Royal Economic Society’s annual conference at the University of Sussex in Brighton next week.

The study finds that women with small children or many children, women in the highest wage bracket and women who are more educated are more likely to experience the pay and career benefits of government-provided childcare.

It also found that the share prices of firms located in areas with high government-provided childcare react less negatively to the announcement of a gender quota on corporate boards than firms located in areas with lower government-provided childcare.The reports says this suggests that government-provided childcare results in a larger pool of qualified women that these firms can draw from to fulfil the gender quota.

It concludes that it is better to take a bottom-up approach that improves women’s career progression through family-friendly policies such as childcare provision than solely to impose quotas at the top.

Another study, based on research from Italy and also being presented at the conference, finds that women who opted for shorter maternity leave in return for a bonus of state-subsidised childcare ended up considerably less likely to leave the labour market. But the earnings benefits from the incentive to return to work earlier only lasted for a short period.

And another study finds that a strong message of gender equality – even over a relatively short period – can change women’s willingness to compete. The research by Alison Booth, Elliott Fan, Xin Meng and Dandan Zhang compared the competitiveness of women growing up in different periods in the recent history of mainland China and Taiwan.

The study found that women in Beijing who grew up during the communist regime, when gender equality was emphasised, were more competitively inclined than their female counterparts who grew up during the post-1978 reform era. These women are also more competitively inclined than their counterparts in Taipei.



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