Childcare Market Assessment 2006
Key Note Publications Ltd, January 2006
Despite a slight rise in the birth rate between 2003 and 2005, the child population has fallen since 2001. Nevertheless, demand for childcare continues to rise as mothers of young children opt to work either full or part time.
Since the introduction of the National Childcare Strategy in 1998, the Government has introduced many measures to improve conditions for working parents and their children. However, issues and challenges relating to implementation have been raised by the National Audit Office's (NAO's) review in 2004, the Department for Education and Skills' (DfES') 5-year strategy in July 2004 and the Government's 10-year childcare strategy in December 2004. The Government and the Welsh Assembly have achieved their targets relating to the provision of free part-time early education places to all 3 year-olds in England (April 2004) and Wales (September 2005). In addition, it has met its targets regarding childcare tax credits for working parents, as well as making headway with its plans for the introduction of Sure Start centres and `wrap-around' care. However, the full impact of the initiatives is yet to be seen, with issues such as geographical variation in childcare provision and the sustainability of childcare provision still to be addressed.
The private nursery sector is experiencing a period of consolidation. The falling child population and increasing competition from the state sector as a result of government initiatives means that nursery chains, now faced with greater competition from primary schools and state school-managed wrap-around care, are developing with caution. Private nurseries are also influenced by the trend towards more flexibility in the workplace, which means that parents are likely to require part-time rather than full-time nursery places. In addition to this, although it is early days, the introduction of childcare tax credits for parents opting to make use of home-based childcare is also anticipated to influence parental choice. This places childminders and nannies in a good position to market themselves against nurseries over the next few years.
Research commissioned in October 2005 exclusively for this report indicated that government childcare initiatives have not made a great impression on respondents, with only 21% claiming that the Government was not doing enough to help mothers who wish to go back to work, while 21% felt that the Government was doing too much.
It is forecast that, over the next 5 years (to 2010), the total UK childcare market will continue to grow, albeit at a slower rate than the previous 5 years (2001 to 2005).
Executive Summary
1. Introduction
OVERVIEW
DEFINITION
Types of Childcare
Day Nurseries
Childminders
Playgroups or Pre-Schools
Nursery Schools and Classes
Nannies
Sure Start Children's Centres
Out-of-School Wrap-Around Childcare
2. Strategic Overview
SOCIO-DEMOGRAPHIC BACKGROUND
The Child Population
Table 1: The UK Population Aged 0-9 Years Old (000), Mid-Years 2001-2005
Table 2: The UK Population Aged 0-8 Years Old by Individual Age Group (000), Mid-Years 2003-2005
Working Mothers
Table 3: UK Employment Rates by Age of Youngest Child (%), Spring (March to May) 2005
Table 4: UK Part-Time Employment Rates by Age of Youngest Child (%), Spring (March to May) 2005
GOVERNMENT INITIATIVES: THE NATIONAL CHILDCARE STRATEGY
The Childcare Bill
THE CONSUMER
INFORMATION SOURCES AND ORGANISATIONS
Childcare Link
Daycare Trust
4Children
National Childminding Association
National Day Nurseries Association
Pre-School Learning Alliance
Professional Association of Nursery Nurses
Scottish Childminding Association
Scottish Pre-School Playgroups Association
Sure Start
Wales Pre-School Playgroups Association
ADVERTISING AND PROMOTION
Main Media Advertising Expenditure
Table 5: Main Media Advertising Expenditure by Government Organisations on Childcare-Related Issues (£000), Year Ending March 2004
CURRENT PROVISION OF CHILDCARE
England
Table 6: Daycare Provision in England for Children Under 8 Years Old by Number of Providers, 30th September 2004 and 2005
Table 7: Daycare Provision in England for Children Under 8 Years Old by Number of Places, 30th September 2004 and 2005
Table 8: Number of 3 and 4 Year-Olds in Nursery Schools and Classes in England, January 2001-2005
Scotland
Table 9: Pre-School Education and Daycare Provision for 3 and 4 Year-Olds in Scotland by Number of Providers, January 2003-2005
Table 10: Pre-School Education and Daycare Provision for 3 and 4 Year-Olds in Scotland by Number of Places, January 2003 and 2004
Wales
THE COST OF CHILDCARE
Table 11: Typical Average Weekly Nursery Costs in England, Scotland and Wales by Type (£), January 2003-2005
THE CHILDCARE MARKET
Table 12: The Total UK Childcare Market by Sector by Value (£m), Years Ending March 2001-2005
Figure 1: The Total UK Childcare Market by Sector by Value (£m), Years Ending March 2001-2005
3. Private-Sector Provision
BACKGROUND
COMPETITIVE STRUCTURE
Table 13: The 20 Largest Nursery Chains in the UK and Republic of Ireland by Number of Places and Settings, June and November 2005
EXTENT OF PROVISION
Table 14: Number of Private Day Nurseries and Nursery Places in England, January 1999-2004
Table 15: Number of 3 and 4 Year-Olds in Independent Schools in England (number and %), January 2000-2005
COST OF PRIVATE-SECTOR NURSERY PROVISION
Table 16: Typical Weekly Costs for a Full-Time Nursery Place in Great Britain by Region (£), January 2005
4. Local Authority/Voluntary Sector
BACKGROUND
NURSERY SCHOOLS AND CLASSES
Table 17: Total Number of Maintained Nursery Schools and Nursery Classes in Primary Schools in England, January 2002-2005
Table 18: Number of 3 and 4 Year-Olds in Nursery Schools in England, January 2002-2005
Table 19: Number of 3 and 4 Year Olds in Nursery Classes in Maintained Primary Schools in England, January 2002-2005
Table 20: Total Number of 3 and 4 Year-Olds in Maintained Nursery and Primary Schools in England, January 2002-2005
Table 21: Total Percentage of 3 and 4 Year-Olds in Maintained Nursery and Primary Schools in England (%), January 2002-2005
Table 22: Total Number and Percentage† of 3 and 4 Year-Olds in Maintained Nursery and Primary Schools in England by Region, January 2005
5. Individual Care
BACKGROUND
NANNIES
Cost of Nannies
Table 23: Average Weekly Net Wages for Nannies by Type by Region (£), January 2005
CHILDMINDERS
Table 24: Number of Childminder Providers and Places in England, 30th September 2004 and 2005
Cost of Childminding
Table 25: Typical Weekly Costs for a Full-Time Childminding Place in Great Britain by Region (£), January 2005
6. Provision for School-Age Children
BACKGROUND
PROVISION IN SCHOOLS
Table 26: Summary of Findings in the Department for Education and Skills' Extended Services in Schools: Baseline Survey of Maintained Schools in 2005 (%), September 2005
Table 27: Selected Private Nurseries Providing Out-of-School Childcare by Number and Type, Summer 2004
PROVISION FOR TEENAGERS
EXTENT OF PROVISION FOR THE UNDER 8s
Table 28: Out-of-School Daycare for Children Under 8 Years Old in England by Number of Providers and Places, 30th September 2004 and 2005
COST OF SCHOOL-AGE PROVISION
Table 29: Typical Weekly Costs for 15 Hours a Week in an After-School Club in Great Britain by Region (£), January 2005
Table 30: Typical Weekly Costs for a Full-Time Summer Playscheme in Great Britain by Region (£), 2005
7. An International Perspective
INTERNATIONAL COMPARISON
Pre-School Provision
School-Age Provision
8. PEST Analysis
POLITICAL FACTORS
ECONOMIC FACTORS
SOCIAL FACTORS
TECHNOLOGICAL FACTORS
9. Consumer Dynamics
OVERVIEW
Table 31: Summary of Attitudes Towards Childcare (% of respondents), 2005
ATTITUDES TOWARDS FAMILY-FRIENDLY POLICIES
Table 32: Attitudes Towards Family-Friendly Policies (% of respondents), 2005
ATTITUDES TOWARDS PARENTAL LEAVE AND CHILDCARE BENEFITS
Table 33: Attitudes Towards Parental Leave and Childcare Benefits (% of respondents), 2005
ATTITUDES TOWARDS GOVERNMENT HELP FOR WORKING MOTHERS OF YOUNG CHILDREN
Table 34: Attitudes Towards Government Help for Working Mothers of Young Children (% of respondents), 2005
ATTITUDES TOWARDS WORKING MOTHERS OF YOUNG CHILDREN
Table 35: Attitudes Towards Working Mothers of Young Children (% of respondents), 2005
CHILDCARE PREFERENCES
Table 36: Childcare Preferences — Nanny, Childminder or Nursery (% of respondents), 2005
Table 37: Childcare Preferences — Family (% of respondents), 2005
ATTITUDES TOWARDS PAY AND EDUCATION OF CHILDCARE WORKERS
Table 38: Attitudes Towards Pay and Education of Childcare Workers (% of respondents), 2005
ATTITUDES TO CHILDCARE FOR PRE-SCHOOL and SCHOOL-AGE CHILDREN
Table 39: Attitudes Towards Childcare for Pre-School and School-Age Children (% of respondents), 2005
10. Company Profiles
INTRODUCTION
NORD ANGLIA NURSERIES LTD
Corporate Strategy
Recent Developments
Profitability
Table 40: Financial Results for Nord Anglia Nurseries Ltd (£000), Years Ending 31st August 2002-2004
ASQUITH COURT SCHOOLS LTD
Corporate Strategy
Recent Developments
Profitability
JUST LEARNING LTD
Corporate Strategy
Recent Developments
Profitability
Table 41: Financial Results for Just Learning Ltd (£000), Years Ending 30th April 2003-2005
BRIGHT HORIZONS FAMILY SOLUTIONS INC
Corporate Strategy
Recent Developments
Profitability
Table 42: Financial Results for Bright Horizons Family Solutions Ltd (£000), Years Ending 31st March 2002, and 31st December 2002 and 2003
BUSY BEES NURSERIES LTD
Corporate Strategy
Recent Developments
Profitability
Table 43: Financial Results for Busy Bees Nurseries Ltd (£000), Years Ending 31st December 2002-2004
KIDSUNLIMITED LTD
Corporate Strategy
Recent Developments
Profitability
Table 44: Financial Results for Kidsunlimited Ltd (£000), Years Ending 30th April 2002-2004
BUFFER BEAR NURSERIES LTD
Corporate Strategy
Recent Developments
Profitability
Table 45: Financial Results for Buffer Bear Ltd (£000), Years Ending 31st August 2002-2004
TEDDIES NURSERIES LTD
Corporate Strategy
Recent Developments
Profitability
Table 46: Financial Results for Teddies Nurseries Ltd (£000), Years Ending 31st December 2002-2004
CHILD BASE LTD
Corporate Strategy
Recent Developments
Profitability
Table 47: Financial Results for Child Base Ltd (£000), Years Ending 31st October 2002-2004
THE CHILDCARE CORPORATION
Corporate Strategy
Recent Developments
Profitability
Table 48: Financial Results for The Childcare Corporation (£000), Years Ending 31st March 2003-2005
11. The Future
FORECASTS
Table 49: The Forecast UK Population Aged 0-8 Years Old by Individual Age Group (000 and %), Mid-Years 2005-2009
Table 50: The Forecast Total UK Childcare Market by Value (£m), Years Ending March 2006-2010
Figure 2: The Forecast Total UK Childcare Market by Value (£m), Years Ending March 2006-2010
THE FUTURE OF CHILDCARE
Private Nurseries
Childminders
Nannies
12. Consumer Confidence
METHODOLOGY
THE WILLINGNESS TO BORROW
Table A: The Average Amount Consumers Are Willing to Borrow in Order to Purchase Expensive Items at Current and Constant November 2004 Prices (£ and £bn), November 2004, February 2005, May 2005, August 2005 and November 2005
The Desire to Borrow Stays Strong
Table B: The Number of Adults Willing to Borrow in Order to Purchase Expensive Items (000 and %), November 2004, February 2005, May 2005, August 2005 and November 2005
THE WILLINGNESS TO SPEND FROM SAVINGS
Table C: The Average Amount Consumers Are Willing to Spend from Savings in Order to Purchase Expensive Items at Current and Constant November 2004 Prices (£ and £bn), November 2004, February 2005, May 2005, August 2005 and November 2005
Consumers Increasingly Cautious
Table D: The Average Amounts Adults are Confident Spending to Purchase Expensive Items (£ and %), November 2004, February 2005, May 2005, August 2005 and November 2005
13. Further Sources
Associations
Publications
General Sources
Government Publications
Bonnier Information Sources
- Nord Anglia Nurseries Ltd
- Asquith Court Schools Ltd
- Just Learning Ltd
- Bright Horizons Family Solutions Inc
- Busy Bees Nurseries Ltd
- Kidsunlimited Ltd
- Buffer Bear Nurseries Ltd
- Teddies Nurseries Ltd
- Child Base Ltd
- The Childcare Corporation
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