Collective childcare expansions did not increase maternal employment, but crowded out individualized childcare solutions

From 2000 to 2016 in France, a series of national plans increased the supply of heavily subsidized collective childcare provided by daycare centers by 150 000 spots.

These childcare expansions did not lead to any significant change in mothers’ labor outcomes. Specifically, it is implausible that being offered a childcare spot thanks to these expansions allowed more than 5 % of the recipients not to interrupt their careers when their children were aged less than 3. As a result, those newly created spots induced at most 8 000 more mothers of young children to hold a salaried job in 2016, whereas they would not have, had the supply remained the same since 2000.

Increases in the collective childcare supply at the municipal level did not affect the take-up of paid parental leave by mothers who are the most prone to opt out of the labor market. Instead, these collective childcare expansions crowded out individualized formal childcare solutions, such as childminders or at-home childcare. In other words, most mothers who benefited from a newly created childcare spot would have otherwise maintained their labor force attachment by resorting to other childcare solutions. Because all formal childcare arrangements are subsidized, these substitution effects matter for the evaluation of the public finance impact of childcare expansions.