Workplace childcare key to closing gender gaps, says Queen Mary economist

Anna Raute, Senior Lecturer in Economics at Queen Mary University of London, shared her findings at Women Economists: Shaping Policies, Shaping Lives, an event hosted by LSE’s Centre for Economic Performance on Wednesday 19 February. The discussion brought together leading economists to explore how research can drive policies that promote gender equality.

Accelerating Action: Tackling the “child penalty”

This year’s International Women’s Day theme "Accelerate Action" calls for urgent steps to break down systemic barriers to gender equality. One of the most persistent challenges is the career cost of motherhood, known as the “child penalty.”

Anna Raute’s research highlights that, while government policies such as paid parental leave and subsidised childcare exist, they have not gone far enough in addressing the long-term setbacks women face in the labour market.

However, employers can play a crucial role in accelerating change. Her research, based on linked employer-employee data from Germany, found that:

• Mothers in firms with childcare support are 10% more likely to return to work after childbirth.
• These firms attract and retain more female talent, particularly in high-skilled roles.
• The “child penalty” is reduced by over 10%, helping mothers maintain stronger career trajectories.

Speaking at the event, Anna Raute emphasised the need for immediate action:

“If we want to accelerate progress towards gender equality, workplaces must step up. Employer-provided childcare is a proven way to support working mothers, keep women in the workforce, and reduce long-term inequalities. But it’s not enough broad government action is needed to ensure childcare is accessible to all.”

A shared responsibility for gender equality

Achieving gender equality cannot be left to individuals or workplaces alone, it requires system-wide change.

While employer-led initiatives help reduce the child penalty for women in high-skilled jobs, only broader access to affordable childcare can ensure that all women regardless of background have equal opportunities to build their careers.

“Firms that provide childcare see a rise in female employment, but we need more than isolated efforts. To truly accelerate action on gender equality, we must expand childcare access across all sectors, ensuring that no mother has to choose between her career and her family,” Anna Raute added.

The Women Economists: Shaping Policies, Shaping Lives event reinforced the importance of data-driven solutions to gender inequality, demonstrating how research can drive policies that empower women and create lasting change.

Read Anna Raute’s full blog on the LSE site here: https://blogs.lse.ac.uk/businessreview/2025/03/06/gender-gaps-are-reduced-in-family-friendly-workplaces/