A report from TD Economics shows women with young children have been joining the work force in droves since the pandemic. Francis Fong, Senior Economist at TD, tells Kim Parlee the availability of affordable childcare and a hybrid work model has been giving women more career options.
* A new report from TD Economics shows women with young children have been joining the workforce in droves since the pandemic. Since 2020, an estimated 111,000 women have joined. And there are some very interesting statistics and reasons as to why this is happening.
* Francis Fong is a senior economist at TD and an author of the report. Francis, it's good to see you. Let me jump right in.
* The report, which was, if I can say so, pretty awesome, by the way, a really good report, was called "The Space Between Us." It highlights a few interesting trends that are helping women with young children join the labor force. And you and I were chatting in the break, and this is just about getting back to basics, I mean, providing what they need.
* So tell me just the overview of what the report showed.
* Yeah. So you already hit the nail on the head. 111,000 additional working women, that represents a four percentage point increase in the labor force participation rate, which is absolutely massive. But it also represents a really sharp acceleration in the rate at which women with young children are joining the labor force. It's roughly a doubling of what we saw in the previous three years.
* And obviously, we're attributing that to two factors. One is, obviously, the increase in things like remote work but, more broadly, workplace flexibility since the pandemic. But over the longer term, we have seen sort of this uptick in the part rate for women with young children over time, which we're attributing to sort of efforts by individual provinces to kind of improve access to affordable childcare.
* Areas like Quebec, BC, and Alberta have all made efforts over the past-- well, in Quebec, it's been quite some time, but more recently in Alberta and BC. And those have had a really significant impact.
* And it's one of those things because demand begets demand. We'll talk about that later on, too, is like more people want it. And then, of course, they have to keep up with the demand at the same time. The thing that was really interesting-- and I know we have a chart we can pull up here on this-- is that we take a look at some of the industries. This is not equally distributed amongst all different kinds of companies across Canada.
* Where do you see the biggest pickup?
* Yeah. So just like we were talking about, the impact of remote work and workplace flexibility, those have really been the dominant factors over the last three years. And obviously, industries that can offer office work, things of that nature, those have really benefited and have been able to attract the previously untapped labor pool.
* So areas like finance and insurance, professional and technical services, public administration-- those have gained significant employment share among mothers, whereas you look at other industries like retail, food and accommodation. Those have really struggled to kind of attract or even retain the kinds of labor that they had before the pandemic.
* It's going to be interesting to see what happens as things, you know, quote unquote, "normalize." I mean, a lot of companies, people are coming back into office not five days a week but three. And it's still providing that flexibility, but the other thing you talked about was the affordable childcare, which is there at the same time helping with that.
* Maybe give us a little more detail in terms of what you're seeing on there, you know, where it's-- Quebec kind of paved the way, if you will, on that side of things. But how much is going to be needed in all the province? And where are we in terms of providing that supply?
* Yeah. So you asked a really tough question there, Kim. So there's a lot to unpack there. So basically, with the kind of rise of hybrid work as opposed to remote work, we are seeing a lot of industries move away from fully remote into hybrid. That still offers a lot of flexibility for families. But at the end of the day, more in-person, basically, it's going to put more onus on child care to be able to pick up the slack for families and, in particular, mothers.
* Thankfully, we're now in a situation where all the provinces and territories have now signed these provincial and territorial agreements with the federal government to offer $10-per-day childcare. But the real challenge now that we're facing is that the number of potential folks that will demand childcare could potentially exceed what provinces have committed to.
* If we take a look at all the different provinces, all their commitments to create childcare spaces in the wake of these agreements, we estimate that we could be falling short anywhere from 240 to 315,000 spaces nationwide just because there's just so much unmet demand for families that are looking to potentially get back into the labor force.
* It's fascinating, too. You brought up in your report the idea of childcare deserts. And again, you pulled this in from the states, I know. But anybody who has kids knows that when you see one place for child care pop up, there's a whole bunch that pop up around it. But sometimes vast parts of cities or provinces don't have the childcare too.
* So where it's distributed matters as well.
* Absolutely, and that's an absolutely key point. We see all these commitments from provinces to say we're going to create x number of thousands of spots. But the distribution of those spots actually matters. And certainly research that's out there will indicate that if you go to more rural areas, Indigenous communities, basically anywhere outside of major metropolitan centers, which are already-- folks there are already struggling to access childcare. If you go outside of those areas, it's even more difficult.
* And you coined the term already, childcare desert. That's basically areas where there are at least three children for every one licensed childcare spot. So when we see these commitments from the provincial governments, we have to take into consideration where those things are distributed. And it's also not just the physical space that matters either.
* To create a childcare spot, it's not just about having a building and a space for a child to be there. It needs to be staffed. So in addition to the potentially hundreds of thousands of spots that we might need to create in addition to what's already been committed, that just means we need to be hiring more, training and retaining more early childhood educators and child care workers to actually staff these spaces.
* Yeah. And as you noted, so much matters in detail. As the ratio goes down, the ratio of children to someone who's caring for them is much lower in the beginning than later on. I've only got 45 seconds. And I don't want to skip over this because I want to highlight, first off, this is good news, the fact that we're actually seeing more participation of mothers in the workforce. That's awesome.
* The same time, though, you highlight something about the equity pay gap. And there is an unexplained factor right now. So if you could in 15 seconds, what do you mean? You talk about a motherhood penalty.
* Yeah. So basically, if you look at the pay gap between men and women, we see that narrowing over time. But an increasing portion of that is unexplained. So we can't explain that with factors related to occupational choice, job tenure, things of that nature. So what researchers are largely pointing to is what's called the motherhood penalty, or at least that's one factor behind this unexplained pay gap, the remaining unexplained pay gap, which is basically folks being penalized for becoming mothers.
* And so what we do know, however, is that the shorter the disruption that mothers face in their workforce, the smaller the penalty. So really accessible childcare, workplace flexibility, this is a pay equity issue because it can help actually reduce that pay gap further.
* Francis, always a pleasure. Thanks so much.
* It's wonderful to talk to you, Kim.