Labour market gender gaps and childcare policies in countries with different social investment strategies

Abstract

We study the role of formal and informal childcare within the ECEC policies for gender employment and pay gaps, considering the life course stages distinctive for childcare tasks. The ECEC policies are framed within the types of social investment strategies identified in the EU countries to picture developments in social investments after 2005. The aggregated EU‐SILC data from 2005 to 2019 for 27 European countries have been used in the panel regression models to uncover how the caring arrangements influence labour market gendered outcomes of women at different ages (15–24, 25–49, 50–65). We find that better provision and use of early education and childcare not only contribute to early investment in human capital but it also facilitates mothers' employment and thus contributes to lowering gender employment and pay gaps. However, better coverage of care for children older than 3 years old results in negative employment effects for grandmothers. These effects vary also across countries, depending on their overall institutional setting depicted by the types of social investment strategies distinguished. Consequently, the ECEC agenda should be extended by addressing the employment of women at the pre‐retirement age. It is crucial not only for reducing gender gap in employment and pay but also in the light of challenges generated by demographic developments—the labour force shrinking and the population ageing processes.