- Work does not pay for many British women says Commission of Living Standards
By Hugo Duncan
The soaring cost of childcare means millions of families face two decades of stagnant living standards, a landmark report warns today.
The Commission on Living Standards says that even if the economy recovers, around a third of the working age population some 11million people will be no better off in 2020 than they were in 2000.
Among the worst hit are mothers because the cost of childcare is so high they cannot afford to go back to work.
No improvement: Older workers are one of the groups who are likely to suffer a decline or stagnation in living standards until 2020
Older workers and youngsters without qualifications also face an uncertain future as they struggle to make ends meet.
The report says: 'Millions of households are heading for a long period of stagnant living standards.
'The outlook for the bottom half of the working population is bleak even once growth returns.'
The Commission, set up by the Resolution Foundation in early 2010, warns that many women with children cannot afford to go back to work.
No benefit: Work does not pay for many women in Britain, says Commission on Living Standards
It shows that a full-time second earner with two young children in a typical middle income household on a salary of 19,550 keeps just 1,060 a year after childcare costs, taxes and lost benefits. That is only 20 a week.
In a worst-case example, a family with one parent on the minimum wage and a second earner returning to work full-time on the same salary would be left with only 211 a year 4 a week from the second parent's wage after childcare costs and loss of tax credits were taken into account.
'Work simply does not pay for many women in modern Britain,' says the report.
Vidhya Alakeson, deputy chief executive of the foundation, said: 'We need major change in our childcare system to ensure that work is always worthwhile and that working more hours or a pay rise results in higher take home pay.'