ISBN 1-85765-830-2

Executive Summary

Table of Contents

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EXECUTIVE SUMMARY

Childcare is central to the Government's welfare reform programme, being a fundamental service which supports the social and economic prosperity of the UK. Its provision is set to increase sharply in 2000/2001, in line with the National Childcare Strategy, and more especially following the introduction of the new Child Tax Credit in October 1999, given the pre-existing level of excess demand. The current shortage of places is indicated by the fact that there are only 830,000 registered childcare places for 5.1 million children under the age of 8 in England, which gives a ratio of approximately one place to every six children.
The cost of formal childcare is prohibitively expensive, and informal childcare is estimated to account for over half of all childcare. The average cost of childcare for a family with one pre-school child and one child at school requiring after-school and holiday care, is estimated to be around £6,000 each year, which means that a family could typically pay out as much as a third of its income on childcare. Parents spent an estimated £2.7bn on childcare in 1998, and this represented a 3.8 percent increase on 1997.
The range of childcare services includes childminders, day nurseries, nursery schools and classes, playgroups, out-of-school clubs and holiday play schemes. The fastest growth has occurred in the provision of out-of-school club places and holiday play schemes, which registered 253.7 percent and 162.7 percent increases, respectively, between 1993 and 1998. This group was followed by private day nurseries, whose provision of places grew by 56.4 percent over the period under review.
The proportion of women with dependent children in paid employment outside the home is continuing to rise, and changes in underlying female work patterns are contributing to the growing surge in demand. It is estimated that women will account for 900,000 of the projected rise of 1.2 million in the labour force by 2006. The growth in employment of mothers has also been mirrored by an expansion in the number of women achieving educational qualifications, and a convergence of pay levels for women and men in full-time work.
The early indications are that the unmet demand for childcare services will be met as the Government is committed to supporting working parents and closing the `childcare gap' in Britain. Around £8.5bn has been allocated to spend on the entire sector and, in line with this, increased provision for childcare. Key Note forecasts show a continuing rise in the number of childcare places for all sectors except playgroups. Out-of-school clubs and holiday play schemes are projected to rise most rapidly, reflecting both underlying demographic trends and the extra Government provision for this age group through the increase in the age limit from 11 years-old to 14 years-old for entitlement to Childcare Tax Credit towards the end of 1999. The rise in childcare places is forecast to be most pronounced in the shorter term rising by 11.9 percent from 1998 to 1999, boosted by Government funding. The childcare market is expected to slow down towards the end of the 5-year forecast period with an increase of 11.2 percent over the 2-year period from 2001 to 2003.

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TABLE OF CONTENTS

Executive Summary

Market Definition

INTRODUCTION

MARKET SECTORS

MARKET POSITION

MARKET TRENDS

Table 1: Economic Activity Status of Single Women by Age of Youngest Dependent Child in the UK ( percent), 1998

Table 2: Economic Activity Status of Married Women by Age of Youngest Dependent Child in the UK ( percent), 1998

Table 3: Formal Childcare Costs (£), 1998

Table 4: Typical Expenditure on Childcare Compared with Other Household Expenditure (£), 1998

Market Size

THE TOTAL MARKET

MARKET SECTORS

A EUROPEAN PERSPECTIVE

Table 5: The Number Childcare Places in England, 1993 and 1998

Table 6: Distribution of Childcare Services ( percent), 1993 and 1998

Table 7: Estimated Value of Spending on Childcare by Parents (£bn), 1993-1998

Table 8: Number of Places with Registered Childminders in England, 1993-1998

Table 9: Number of Registered Childminders in England, 1993-1998

Table 10: Number of Places in Day Nurseries in England, 1993-1998

Table 11: Number of Day Nurseries in England, 1993-1998

Table 12: Number of Places at Maintained Nursery Schools and Classes in England, 1993-1998

Table 13: Number of Maintained Nursery Schools and Classes, 1993-1998

Table 14: Number of Places in Non-Maintained Nursery Schools, 1993-1998

Table 15: Number of Places in Playgroups in England, 1993-1998

Table 16: Number of Playgroups in England, 1993-1998

Table 17: Playgroup Sessions, 1994-1998

Table 18: Number of Places for 5 to 7 Year-Olds at Out-of-School Clubs in England, 1993-1998

Table 19: Number of Out-of-School Clubs for 5 to 7 Year-Olds in England, 1993-1998

Table 20: Number of Places for 5 to 7 Year-Olds in Holiday Schemes in England, 1993-1998

Table 21: Number of Holiday Schemes for 5 to 7 Year-Olds in England, 1993-1998

Industry Background

RECENT HISTORY

LEGISLATION

INDUSTRY CONCENTRATION

DISTRIBUTION

CHILDCARE VOUCHERS

TRADE ASSOCIATIONS AND RELATED ORGANISATIONS

Table 22: Employer's Workplace Schemes ( percent), 1996

Competitor Analysis

KEY USERS AND PROVIDERS OF CHILDCARE SERVICES

MARKET LEADERS

Table 23: Selected Companies Providing Childcare Services (£m), 1997/1998

Strengths, Weaknesses, Opportunities and Threats (SWOT)

STRENGTHS

WEAKNESSES

OPPORTUNITIES

THREATS

Buying Behaviour

INTRODUCTION

Table 24: Presence of Children ( percent of women), 1998

Table 25: Working Status ( percent of women), 1998

Table 26: Marital Status ( percent of women), 1998

Table 27: Average Weekly Household Expenditure on Childcare (£), 1997/1998

Table 28: Average Weekly Household Expenditure on Domestic Help and Childcare by Gross Income Decile Group (£), 1997/1998

Outside Suppliers to the Industry

INTRODUCTION

SERVICES

MANUFACTURED PRODUCTS

Current Issues

INTRODUCTION

1999 BUDGET

CHILDCARE TAX CREDIT

NATIONAL CHILDCARE STRATEGY

NATIONAL CHILDCARE WEEK 1999

FAIRNESS AT WORK BILL

5-TERM SCHOOL YEARS

Forecasts

INTRODUCTION

DEMOGRAPHIC DEMAND

EMPLOYMENT TRENDS

FORECASTS 1999 TO 2003

Table 29: Projected UK Population Aged 0 to 14 Years-Old (000), 1999-2003

Table 30: Distribution of the Projected UK Population Aged 0 to 14 Years-Old ( percent), 1999-2003

Table 31: Projected Growth in UK Population Aged 0 to 14 Years-Old ( percent), 1999-2003

Table 32: Projected UK Labour Force by Gender and Age (million), 1999 and 2003

Table 33: Projected Number of Childcare Places in England, 1999-2003

Company Profiles

INTRODUCTION

DEFINITIONS

FURTHER INFORMATION

Further Sources

ASSOCIATIONS

PERIODICALS

DIRECTORIES

GENERAL SOURCES

HOPPENSTEDT BONNIER INFORMATION SOURCES

GOVERNMENT PUBLICATIONS

OTHER SOURCES

Text © 1999 Key Note

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