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How Successful Are Childcare Subsidy Reforms in Promoting Childcare Usage and Maternal Employment in Australia?

Author

Listed:
  • Doan, Lina

    (Monash University)

Abstract

Although it is widely believed that expanding childcare subsidies can increase maternal labour force participation, evidence on the effectiveness of such policies in the Australian context remains limited. We provide new evidence on this relationship using a difference- in-differences approach, leveraging rich Australian panel data and the increase in childcare subsidies introduced by the 2022 Child Care Subsidy (CCS) reform. Our findings show that formal childcare participation and hours of usage increased significantly following the reform; however, there are no robust or significant effects on maternal labour supply, either on the extensive or intensive margin. These results align with a recent body of research suggesting that while childcare subsidies can substantially increase childcare utilisation, their effects on maternal employment are often limited or context-dependent.

Suggested Citation

  • Doan, Lina, 2026. "How Successful Are Childcare Subsidy Reforms in Promoting Childcare Usage and Maternal Employment in Australia?," Warwick-Monash Economics Student Papers 100, Warwick Monash Economics Student Papers.
    • Handle: RePEc:wrk:wrkesp:100
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    Keywords

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    JEL classification:

    • J13 - Labor and Demographic Economics - - Demographic Economics - - - Fertility; Family Planning; Child Care; Children; Youth
    • J22 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Time Allocation and Labor Supply
    • I38 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - Government Programs; Provision and Effects of Welfare Programs
    • C21 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Cross-Sectional Models; Spatial Models; Treatment Effect Models

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