Child Care Activity Test: Incentive or Barrier to Female Participation

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Our report into the impacts of the Activity Test on female participation find that rather than acting as an incentive it is acting as a barrier to female participation, through increasing the costs of searching for work.

Impact Economics and Policy analysis shows that:

• 264,000 women in households with children under 5 are not participating in the workforce and cite child care as a barrier.

• Reducing search costs for women with young children through abolishing the Activity Test could increase participation of mothers with children under 5 years of age by 39,620 and increase GDP by up to $4.5 billion per year.

The report was covered by radio and television, and in this article for The Age. For an expert explanation of the Report’s findings see this from RMIT Senior Lecturer Dr Leonora Risse appearing on The Drum.