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OECD report: Governments need to increase support for families

04/05/2011

“Doing Better for Families”, a recent OECD report, has revealed changing trends in the composition and the well-being of families in OECD countries and urges governments to support families in a time of rapid social change. Poverty in households with children is rising in nearly all OECD countries and the report argues that governments should ensure that their policies protect the most vulnerable.

Families are changing

The report shows that families across the OECD have changed dramatically in just a generation. Since 1970, fertility rates have decreased from 2.2 children per woman to 1.7. Many families now live in non-traditional arrangements: there is more cohabitation, people marry at older ages, marriages end in divorce more often and remarriages are increasing.

The report further highlights that parents’ aspirations have changed. Many fathers and mothers both want to combine a career and an active family life. Children have fewer siblings and live more often with cohabiting or sole parents. More children are growing up in families where parents are with new partners.

Another important change is that many more women work and they are better educated than ever before: more than one third of women under 35 have now completed a university education (compared to just over 20% twenty years ago). On average, about 60% of families now have two breadwinners.

The report considers that further increases in women’s employment would help address the challenges of population ageing, but it may be difficult to achieve if men don’t help out more with housework and caring responsibilities. (On average women do two and a half hours more work in the home than men).

Family poverty is increasing

The report also shows that the child poverty rate  has risen in many countries over the past decade, to reach 12.7% across the OECD, i.e. living in a household with less than half the median income. The figure rises to 20% or more in a number of OECD countries, including Mexico, the United States and Poland.

The problem seems to be particularly acute for single parents. In almost all countries, poverty rates in families with a jobless single-parent are at least twice as high as among those who are working. The report also points out that families with children are more likely to be poor today, compared to previous decades, when the poorest in society were more likely to be pensioners.

Making policies more effective

On average, OECD governments spend around 2.4% of GDP to support families. Some of the benefits go directly to families, through child allowances paid to parents, and others are indirect, such as providing childcare. With budgets tightening in many countries due to the economic crisis, there is a risk that this support could face cuts, the report warns.

The report argues that governments may need to rethink when they spend money on families. It stresses that children, especially those in the poorest families, gain most lifelong benefits from investment during their preschool years. Despite this, the report notes that “many countries wait at least six years before the main public intervention towards child development begins”. The result is that, by the time they go to school, children from the poorest families may already be at a disadvantage in terms of their development compared to children from better-off families.

The report suggests a number of other approaches that could make life better for families. For instance, it points out a business case can be made for more family-friendly workplaces, where employees enjoy more flexible working arrangements. The benefits include “improved retention rates (up to 99%) of female employees after taking maternity leave; reduced overhead costs through home-working and flexible contractual arrangements; and increased productivity and creativity of workers”.

OECD Secretary-General Angel Gurría stressed: “Family benefits need to be well designed to maintain work incentives, but they need to be effective in protecting the most vulnerable, otherwise we risk creating high, long-term social costs for future generations”.

Improved work-life balance: key for family well-being

Family policy is not only about services or cash allowances, income support during leave or tax breaks for families, stresses the report. It is also vital to help families combine work and care commitments, through an integrated set of leave, care and workplace support for parents of young children.

Designing parental leave systems that encourage more fathers to take and share leave and promote their engagement with homecare responsibilities and ensure high-quality childcare services are linked to improved cognitive development, especially for children from poor households, are also identified as key elements in helping families.

“More family-friendly workplaces, equal career prospects for men and women, and a better sharing of care responsibilities not only make economic sense, they are a moral and political imperative,” said Mr. Gurría.

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