At a glance
When a A$4.5 billion investment in childcare was revealed in Australia’s October 2022 Federal Budget, the news was welcomed as a much-needed step towards improving female workforce participation rates.
Yet childcare is just one of several factors that contribute to the low rate, and many are calling for additional far-reaching changes to help more women access employment opportunities.
The current global labour force participation rate for women is just under 47 per cent. For men, it is 72 per cent. That is a difference of 25 percentage points. Some countries such as Yemen, Afghanistan and Egypt have recorded a gap of more than 50 percentage points.
In Australia, the gap is also persistently in favour of men.
As of February 2023, data from the Australian Bureau of Statistics (ABS) indicates that men’s workforce participation is at 71.2 per cent compared to 62.2 per cent for women.
Workplace Gender Equality Agency (WGEA) director Mary Woolridge says, “Despite increases in women’s workforce participation in the past decade, ABS data shows there is still a significant gap compared to men”.
There is also a disparity between the number of women in full-time roles compared with their male counterparts.
Data from the WGEA shows that women constitute only 38.4 per cent of all full-time employees in Australia, while they make up 68.5 per cent of the part-time and casual workforce.
“Considered alongside women’s under-employment – which was at 7 per cent in October – it is clear new approaches need to be implemented to fully enable women who can and want to work, the opportunity to do so,” says Woolridge.
The Australian Government announced its plan to invest $A4.5 million on affordable childcare with the October 2022 Federal Budget.
Danielle Wood, co-founder and first chair of the Women in Economics Network and CEO of the Grattan Institute, says this is a critical step to improving participation rates.
“Making childcare cheaper is the biggest lever available to governments to reduce barriers to women’s workforce participation and support women’s long-term economic security. We estimate that increasing the Childcare Subsidy would boost GDP by more than twice the budget cost.”
“Australia’s tax and welfare settings, combined with high out-of-pocket childcare costs, make it barely worthwhile for the primary carer – generally a woman – to work four or five days a week,” adds Wood.
Affordable childcare is not a new concept. There are many examples of the impact it has in other countries.
In 1997, Quebec, Canada, introduced a universal childcare program that offers parents low-fee preschool for children under the age of five. Initially, the program cost just CA$5 (A$5.50) a day.
When the policy was first introduced, labour force participation among mothers of young children in Quebec was at 64 per cent – this figure rose to 80 per cent by 2016. Across the rest of Canada, female participation increased by only 4 per cent over the same period, Wood says.
“If Australia looked more like Canada – with more women doing paid work and a higher proportion working full-time – this would be about a 6 per cent increase in women’s working hours.
“While an increase of this size should be achievable, even an increase of just 2 per cent would boost our GDP by about A$11 billion,” she says.
According to the Global Gender Gap Report 2022 released by the World Economic Forum (WEF), Australian women are among the best educated in the world.
Yet, since 2006, Australia has dropped from 13th to 36th in the forum’s scorecard on female economic participation.
As the WEF report shows, Australia’s gap is not because women lack the educational qualifications or the skills needed to join the workforce. There are other factors that need to be addressed, says Wood.
“About 75 per cent of Australian women aged 25–44 have a post-school qualification. Barriers to highly qualified women working – such as carrying a disproportionate load of unpaid care – leave a huge potential resource untapped,” she says.
Women are also more likely to be responsible for the care of elderly parents and other vulnerable members of the community, which limits their opportunities to participate in the paid workforce, Wood says.
Many carers are forced to leave paid employment or reduce their working hours to manage their caring responsibilities.
The Royal Commission into Aged Care Quality and Safety found that Australia’s aged-care system fails to adequately support informal carers and made several recommendations to increase funding and improve access to respite care.
To help facilitate this, the findings argued that a new funding model was required to consider the needs of informal carers.
Paid parental leave
Another part of the puzzle is parental leave, says Wood.
“The government’s announcement that they will boost leave entitlement to 26 weeks with a ‘use-it-or-lose-it’ component for each parent will hopefully start shifting the dial and encourage more dads to take leave.”
Canada, Norway, Iceland and France are among the countries noted to have generous paid parental leave for fathers and partners, which supports a more equal sharing of unpaid work and enables women to do more paid work.
Sweden offers 480 days of paid parental leave with 90 of those days reserved for the father. In Germany, up to 14 months of paid parental leave can be shared between both parents, and a minimum of two months are reserved for the father.
“A 2021 evaluation of Quebec’s parental leave scheme found that mothers exposed to the scheme were 5 per cent more likely to participate in the labour force and work full time, and 4 per cent were less likely to be unemployed than would have been the case without the policy,” Wood argues.
This approach could also help employers retain talent in a competitive market, says Woolridge. Offering flexible working arrangements has great economic benefits to any business.
“We know that flexibility on when, where and how we work is a priority for many employees, and this is particularly true for workers balancing other caring or family responsibilities,” Woolridge says.
Sexual harassment in the workplace
Research has indicated that for women, workplace sexual harassment can be one of the most damaging barriers to career success and job satisfaction.
In her landmark report, Respect@Work, sex discrimination commissioner Kate Jenkins addressed sexual harassment in the workplace.
According to the report, one in four people who said they had been sexually harassed in the workplace in the last five years experienced negative impacts to their employment, career or work as a result of the most recent incident.
Some people who have been harassed have been forced to implement strategies to prioritise their safety, says Jenkins.
This can include using sick and annual leave to avoid their harasser in the workplace, avoiding certain activities that could have led to building social networks and career progression, leaving their job, and even leaving the sector in which they have built their career.
Things are slowly changing, adds Jenkins. However, to see a significant reduction in the number of people experiencing workplace sexual harassment, all workplaces must act to address harassment.
"We have seen lots of progress in the policy and legislative framework to address sexual harassment in the workplace. Most notably, last year the government passed the Anti-Discrimination and Human Rights Legislation Amendment (Respect at Work) Act 2022, which introduced a positive duty on all Australian employers to take steps to prevent sexual harassment from occurring.
"There is increased engagement from business in addressing workplace sexual harassment, and they need to use the new resources available to them and implement proactive measures to cultivate a respectful workplace culture,” Jenkins says.
The impact of discrimination
Another factor that contributes to lower rates of participation for women is systemic discrimination based on race, disability, age, sexual orientation or geography.
For some people with these intersecting attributes, there are additional barriers to them entering the workforce.
For example, ABS data shows that culturally and linguistically diverse (CALD) women have a significantly lower rate of workforce participation – 47.3 per cent – compared with CALD men – 69.5 per cent.
Migrant and refugee women can also face challenges relating to the formal recognition of overseas education, qualifications and skills, as well as for accessing childcare support. As a result, they are more likely to work in low income, low skill, insecure jobs.
According to Woolridge, “Employers will attract and retain talent if they work hard to ensure their workplace fosters equality for all employees, regardless of gender, age or personal responsibilities outside of work”.