1. Introduction
In recent decades, the increasing employment rates of mothers combined with other changes in Australian society have had a major impact upon many aspects of family life. There have been changes in the use of non-parental care to allow participation in the labour market and related changes in the time parents spend with their children. There have also been effects on material living standards and potentially family and child wellbeing. There have also been other changes in Australian society including increases in the educational attainment of women; increases in the average age of first birth; increased societal acceptance of working mothers; and a greater availability and acceptance of non-parental child care.
Despite the significance of these changes, relatively little is known about how families with young children combine caring for children with participation in paid employment. Also surprisingly, little is known about how these changes have affected the wellbeing of families with young children. The absence of information on this crucial period in the life course of families is largely a result of a lack of nationally representative surveys that provide detailed labour market information for a large sample of families with young children.
Growing up in Australia: the Longitudinal Study of Australian Children (LSAC) is a new study that provides information on a large number of infants and 4 to 5 year-old children and their families (over 10,000 children). With its detailed information on labour force status, job characteristics and measures of wellbeing of the children and other family members, LSAC provides a valuable source of information for understanding the labour market participation of families with young children. The study provides an opportunity to examine the different patterns of parental employment and the characteristics of jobs in which parents with young children are employed. LSAC was initiated and funded as part of the Australian Government's Stronger Families and Communities Strategy by the Australian Government Department of Families, Community Services and Indigenous Affairs (FaCSIA).
The other main Australian dataset with information on a large number of families with preschool-aged children and family labour force status is the five-yearly Australian Bureau of Statistics (ABS) Census of Population and Housing. However, the Census has more limited information on labour force status and has no information on the use of non-parental care and very limited information on wellbeing.
The labour force status of families with children has changed significantly over recent decades, and the changes for families with a child under 5 years of age have been the most dramatic. A few statistics are given here to illustrate these changes. In 1984, 62.8 per cent of couple-parent families with a youngest child under 5 years of age had one parent employed and the other not in paid employment. By 2004, this proportion had fallen to 47.6 per cent. Over this period, there has been a corresponding increase in the proportion of dual-earner families with young children (from 29.2 per cent in 1984 to 46.5 per cent in 2004). In these families, the most common arrangement is for the father to work full-time and the mother part-time (about one-third of couple-parent families).1
Along with the changes in the labour market over the past two decades, there have also been changes in families. One of the major changes has been the growth of single-parent families. Since 1984, single-parent families have risen from 10.5 per cent of families with children aged under 5 years to 18.1 per cent in 2004. Over this period the employment rate in single-parent families with children aged under 5 years has increased from 20.6 per cent to 29.8 per cent, with much of this increase due to growth in part-time employment.2
Joblessness in families with young children is an important social and economic issue, and is an important determinant of family wellbeing. The proportion of jobless couple-parent families with a child aged under 5 years actually decreased from 8.0 per cent in 1984 to 6.0 per cent in 2004. Furthermore, of single-parent families, the proportion in which the parent was not employed fell from 79.4 per cent to 70.2 per cent. Overall, however, joblessness in families with a child aged under 5 years increased during that time. This was because of an increase in the proportion of families that were single-parent families, combined with the lower employment rates of single parents (compared to parents in couple-parent families).
These changing patterns of employment have had a major impact on the ways in which young children are cared for and, in particular, the extent to which they experience various forms of non-parental care before they start school.
There is extensive Australian and international literature on the determinants of labour market outcomes for parents, particularly mothers.3 This literature has consistently found that having children has a much bigger impact upon the employment rates of women and hours of work than it does for men. A detailed review of Australian studies of female labour supply is provided by Birch (2005).
A number of studies on the impact of the taxation and income support system on labour supply decisions have been conducted using microsimulation models (for example, Creedy & Kalb 2005; Kalb 2003; Kalb, Kew & Scutella 2005). Other studies have focused on the effects of the costs of child care on labour supply decisions (for example, Cobb-Clark, Liu & Mitchell 2000; Doiron & Kalb 2002; Doiron & Kalb 2005; Rammohan & Whelan 2005; Rammohan & Whelan 2006).
A key finding of the labour supply literature is that women with children (both couple and single mothers) are more sensitive to the financial incentives in paid employment than are other groups (for example, Apps 1991; Doiron & Kalb 2005; Creedy, Kalb & Kew 2003).
While there have been a number of studies of the determinants of labour supply, these studies have tended to estimate the impact of children of different ages on labour supply decisions, often using age groups such as 0–4 year olds. Studies that have focused on labour market outcomes for parents with an infant include Baxter (2005a) and Glezer (1988).
These studies have not, in general, provided a detailed description of the labour market participation and characteristics of families with children in their first year of life; a time when maternal employment patterns are often changing. Furthermore, few studies have examined questions such as access to family-friendly work arrangements for parents with young children, which is a crucial issue for these families given the time pressures associated with having young children.
The purpose of this report is to provide an overview of the data on labour force participation from LSAC and how use of child care, time spent with children, and parental wellbeing are related to labour force participation. It is hoped that this information will improve the evidence base for those interested in the labour market participation of mothers and fathers with young children, and the implications of this for families. It is also hoped that the report will be of value to others interested in using the LSAC data to analyse labour market participation of families with young children. A number of methodological issues and considerations in using the data for this purpose are discussed in the report (particularly in Section 2).
This report does not analyse how child development and wellbeing is affected by parental employment status, although this will be possible once additional waves of LSAC data have been collected. Throughout this report, the concern is mainly about associations between parental employment and other characteristics and generally causal links are not drawn. This is an important point to keep in mind, particularly in later sections, where multivariate modelling is used to allow a number of characteristics to be taken into account (controlled for) when considering the association between labour force status and child care use or parental wellbeing.
This report covers four main themes. First, the labour force status and job characteristics of parents are described (Section 3). Second, the patterns of use of child care and how they vary according to parental employment are analysed (Section 4). Third, the links between parental employment, the time that parents spend with their children and co-parenting are analysed (Section 5). Fourth, the relationship between parental employment and the wellbeing of parents and their families is explored. The relationship between paid employment and income and financial hardship is analysed in Section 6. The effects of paid employment on family life and the effects of family life on paid employment are examined in Section 7. In Section 8 the relationships between parental employment and wellbeing are explored. The final section draws together the key findings.