Women face dim back-to-work prospects amid lack of childcare, stalling Canada’s economic recovery

Even though her office closed months ago, Natalie Lauzon still makes the 30-minute drive, often twice a day, from her Vancouver home to the area where she used to work her dream job as a research scientist and intellectual property manager for a green tech company.

Lauzon lost her job last month when the company finally shuttered as a collateral consequence of the coronavirus pandemic, but her two year-old daughter still goes to daycare nearby — for now.

Her family can’t afford to continue paying $1,100 per month for daycare on only her husband’s income, and without full-time childcare, she would struggle to land a new job. Complicating matters, it often takes months on a waitlist to find childcare spots in Canada, particularly in large metropolitan areas such as Vancouver.

“It’s almost like this chicken-or-the-egg type thing,” said Lauzon. “How do you go and find a new job, if you don’t have time because your kid is not in daycare.”

Her experience offers a window into some of the challenges that Canada faces as it seeks to pare back its near-record high unemployment rate, which in June, stood at 12.3 per cent.

Lauzon, who holds a PhD in chemistry and has ample work experience, would seem like a strong candidate for a job on paper, but in reality she faces a difficult path to rejoining the workforce and could be sidelined for months, purely as a result of the high cost and inaccessibility of daycare for her toddler.

As authorities across the country weigh whether to reopen daycare centres as well as schools, the decision not only carries health implications, but also has consequences for the economy including whether many parents — who are among the three million Canadians who lost their jobs this year — can rejoin the workforce.

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Already, Statistics Canada has released data showing that childcare and school closures have knocked a significant proportion of parents out of the workforce, either partially or completely, and that has disproportionately affected women. Indeed, employment recovery for women with school-aged children has been the slowest to recover .

In June, for example, 14.3 per cent of women with children under 18 worked less than half their usual hours, compared to 8.7 per cent of their male counterparts, according to Statistics Canada.

Their absence from the workforce is critical as Canada tries to rebound from the economic hit laid by the pandemic.

Employment numbers offer a sense of the magnitude of the hit. In June, approximately 2.5 million people were unemployed, a 1.4 million increase above pre-COVID levels. [DEL: :DEL] The impact on women has been particularly severe, with 12.7 per cent unemployment, higher than the 12.3 per cent national average and 12.1 per cent for men. Women’s participation rate in the labour force is also lower, at 82 per cent versus 90.3 per cent for men, according to StatsCan .

In June, the Organisation for Economic Co-operation and Development estimated in a snapshot of the Canadian economy that annual output is projected to drop by 8 per cent assuming the recovery is uninterrupted. But it also said the government needs to ensure there is adequate support for vulnerable groups, and in 2019, had identified a lack of adequate childcare as a barrier to women’s participation in the workforce.

Clementine Van Effenterre, an assistant professor of economics at the University of Toronto, said many childcare facilities, particularly those that are more dependent on private tuition, may be on the brink of insolvency after months of closure.

In Canada, this threatens to exacerbate the shortage of available childcare programs, whether it’s daycare or before and aftercare for school aged children, which existed before the pandemic.

As a result, more parents may end up taking on this responsibility at the expense of their job. Historically, and statistically, there is ample evidence that women tend to bear childcare and schooling responsibilities, said Van Effenterre.

Because this work occurs inside a home, it doesn’t necessarily show up in gross domestic product or other metrics that gauge the health of the economy and often is left out of broader discussions about the economy.

“There is a very long debate about how we should value work that occurs domestically,” said Van Effenterre, “…and I think it’s very clear right now that the issue of childcare is not an issue (that) only (affects) women or a personal problem, but is an economic question.”

Compared to other developed countries, Canada’s daycare infrastructure, including the before and aftercare programs that working parents rely on for school-aged children, is comparatively poor.

Within the Organisation for Economic Co-operation and Development, a study from 2016 found that in Ontario, after factoring in tax reductions and other benefits, daycare still cost 22.2 per cent of the average family’s net income compared to an OECD average in 29 other countries of 12.6 per cent. A December 2018 working paper by the OECD found that early childhood education and care costs vary widely across Canada, with government spending as a percentage of GDP 0.6 per cent, below the OECD average of 0.7 per cent.

“Even where parents are willing and able to pay for childcare, there is a lack of high quality spaces in many parts of Canada,” according to the paper , estimating current capacity covers less than 25 per cent of 0-5 year olds in the country.

The high cost and limited availability of childcare services impacts working families on a number of fronts, according to a number of people who spoke to the Financial Post.

Julie Duchesne, an executive at Mercer Marsh Benefits Leader, who leads a team of 270 people at the human resources consulting firm Mercer Canada, said her company has intentionally tried to be flexible and allow parents to work reduced hours in recent months while childcare services were down.

Duchesne said she and her husband spent about 10 weeks during the pandemic without any outside childcare for their 18-month old daughter, and split the responsibilities while both were trying to work full-time jobs.

Because of her daughter’s young age, someone needed to be with her at all times, which exacted a mental and physical toll as the two parents worked longer hours.

“You’re not as energized, you’re not as patient, you’re not as focused or as productive,” said Duchesne. “I’m going to remember those 10 weeks for the remainder of my life.”

Eventually, as coronavirus cases came down, their nanny was able to resume caregiving. Although it has provided relief, Duchesne said it has also come with an added health risk because the nanny rides public transportation, which is believed to be a vector for the virus.

In addition, a nanny costs tens of thousands of dollars per year above the cost of daycare in Quebec, where Duchesne resides, even though daycare is more subsidized there and generally costs less than other provinces in Canada.

Not everyone can afford a nanny, or even daycare.

One Toronto lawyer, who has two children in school, said her family faces a difficult choice this summer about childcare. Because their family bubble includes older relatives who are at higher risk if they contract coronavirus, her family has been reluctant to place their two elementary school-aged children into camps with large pools of children.

But this has complicated her own career, forcing her to work reduced hours at her current firm and to drop plans, at least for the foreseeable future, to launch her own solo practice.

While she would be open to hiring a nanny, “financially, it’s a wash right now.”

Her best-case scenario is to work longer hours and see her children less often, but that might still not fully pay for the cost of childcare. It’s a scenario that other people, who also didn’t want their names used, raised to the Financial Post: when the cost of childcare is equal to, or more than your salary, what incentive is there to work?

“To me a stimulus right now would be building capacity for places for kids to go,” the lawyer said. “I’m positive that there are ways you can inject money into the system to get childcare to be this flexible, safe thing we need it to be, so people can look at their employers and say, ‘I’m back.’”

Jessica Eritou, a spokeswoman for the Minister of Families, Children and Social Development, said the federal government recognizes how important childcare services are to the economy and said in a statement that the Safe Restart Agreement, announced by Prime Minister Justin Trudeau in July, puts $625 million towards these efforts.

She did not specify any other details about how the funds will be administered.

“We know that mothers face barriers returning to work without a plan to safely return to school and safely provide childcare services,” Eritou said in a statement. “That’s why our government has supported provinces and territories in these efforts.”

Monica Lysack, professor of early childhood education at Ontario-based Sheridan College, predicted that the lack of childcare options would trigger a crisis in the fall when schools normally reopen, and that would hit mothers particularly hard, as they are statistically more likely to be forced out of their jobs.

“What I’ve been hearing over and over is that parents are exhausted,“ said Lysack. “Both anecdotally and statically we know that women are leaving the workforce in droves. These are women who are not keen to do this, and they’re exhausted but somebody has to take the hit and we’re all going to pay the price.”

Financial Post

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