Expensive cost of childcare means thousands of parents aren’t working

New figures reveal the financial reality of caring for children in Victoria, with many parents staying out of the workforce.

The high price of childcare kept almost 19,000 Victorians out of the workforce last year.

Alarming new figures from the Productivity Commission show that parents, who found the cost of care too high, made up more than 66,000 people across the state who were not working while caring for children.

Across the country, 87,200 people were not working due to the cost of childcare during 2020-21.

In Victoria, the median weekly cost of 50 hours in childcare centres approved for subsidies was up $4 to $558 from the previous year.

Parents using family day care also faced a $2 price hike.

The Productivity Commission found child care subsidies reduced the out‑of‑pocket costs for families in all income categories accessing 30 hours of daycare.

Almost 19,000 Victorians were out of the workforce last year due to high childcare costs. Picture: Jerad Williams

Lower income households benefited the most, with out-of-pocket costs for both centre-based and family day care – as a proportion of gross income- generally higher for middle and higher income earners.

The out-of-pocket costs of child care for families with a gross income of $75,000, who had one child in 30 hours of care, was 4 per cent of their weekly disposable income after subsidies.

However, this rose to 6.3 per cent for families with a gross income of $175,000.

In 2021, the median weekly cost of centre based daycare in major cities and inner regional areas ($543) was higher than in outer regional and remote areas ($500)

From March 7, families with more than one child in care will benefit from a higher childcare subsidy.

The changes, which aim to get more parents in work, are expected to save 250,000 households will save an average of $760 this financial year.

The number of serious incidents at early childhood centres in Victoria have also risen from 3678 to 4052 over the past year.

The largest increase was in the injury, trauma or illness category which soared to 3119, up from 2712 incidents in 2019-21.