Policy Brief Issue 3 | July 2018 Does Access to Preschool Increase Women’s Employment? EAST ASIA AND PACIFIC GENDER By: Daniel Halim, Hillary Johnson, and Elizaveta Perova INNOVATION LAB The East Asia and KEY FINDINGS Pacific Gender • An additional public preschool per 1,000 children raises Innovation Lab the employment of mothers of eligible-aged children by (EAPGIL) carries out 6.9 percentage points, an increase of about 13%. impact evaluations and inferential research to • Availability of public preschools also has positive, but smaller generate evidence on effects on mothers with children younger than eligible age. what works in closing Women with younger children may take into account future gender gaps in assets, childcare options when making decisions about work. economic opportunities, and agency, and how • Private preschools, which cost more on average and have closing these gaps greater variability in terms of quality compared to public can help achieve other preschools, have no impact on women’s employment. development outcomes. Ultimately, EAPGIL seeks to increase the welfare of women CONTEXT and men in East Asia Women’s employment in Indonesia, at 48.7%, is significantly below the and the Pacific by regional average of 56.9%.1 Halim, Johnson and Perova (2017)2 find that lack of promoting the uptake access to informal childcare arrangements with grandparents or other elderly of effective policies and adults in the household is correlated with withdrawal from work. However, there programs identified is no evidence on whether formal childcare arrangements such as preschools based on evidence. or daycare centers impact women’s labor market choices in Indonesia. 1 World Development Indicators for 2017: http://wdi.worldbank.org/tables). 2 Halim, Daniel, Hillary Johnson and Elizaveta Perova. “Could Childcare Services Improve Women’s Labor Market Outcomes in Indonesia?”. 2017. EAPGIL Policy Brief: www.worldbank.org/eapgil In addition to potential benefits related to early different districts (Figure 1) and over time (Figure 2). We childhood development, preschools also alleviate also exploit the exogenous overlap between expanded the childcare burden for mothers. Studies from access to preschool and the time children are eligible for Argentina, the US, and Israel have shown that it to establish the causal relationship. improving access to preschools has positive impacts There are two primary challenges to rigorously on female labor force participation; however, it is not estimating the impacts of preschool expansion on clear whether the same would be true in a different women’s employment. First, the decision to enroll country context like Indonesia. one’s child in preschool may be driven by factors that also affect a woman’s labor market decisions, such as WHAT DID WE DO? career preferences and family circumstances, which We combine two data sets: Indonesian Family Life we cannot observe and account for in the analysis. Survey (IFLS), a household survey which tracks 10,000 Second, construction of a preschool in a district may women3 in 5 waves of data collection between 1993 be correlated with other district level factors that may and 2004 and a village census (PODES) carried out affect women’s employment, such as local economic development. Our data and empirical strategy permit every 3 years, which contains information on the us overcome both challenges4. availability of preschools in a village. To estimate the effect of preschool availability of women’s employment We study one specific type of preschool: Taman we use variation in the number of preschools in Kanak-kanak (TK). TK is a formal education program FIGURE 1: PUBLIC & PRIVATE PRESCHOOLS The IFLS has a high re-contact rate: 87.8% of households contacted in 1993 were successfully contacted or confirmed to be dead in 2014. 3  We isolate the impact of preschool availability at the district level by including district-time fixed effects, and control for time-invariant differences between 4  women by including individual fixed effects. For more details on the methodology, please see the full paper at: www.worldbank.org/eapgil FIGURE 2: AVERAGE NUMBER Expanding access to public preschools increases OF PUBLIC AND PRIVATE women’s employment PRE-SCHOOLS PER-DISTRICT We find that mothers of age-eligible children are 20 public private 350 6.9 percentage points more likely to work with an additional public preschool per 1,000 children in 15 300 the district, compared to women without children or women whose children are not eligible (Figure private public 10 250 4). Calculations based on the data from PODES and SUSENAS, Indonesia’s Labor Force Survey, 5 200 suggest that this translates into 1 additional public preschool enabling 52 more mothers of age-eligible 0 150 children to work . We do not find any impacts 1990 1995 2000 2005 2010 2015 associated with availability of private preschools. year Note: data from Podes 1990-2014, aggregated to districtsas they existed in 1993 This difference in impacts of private and public preschools may be due to the dual role played aimed to prepare for school children between by childcare services. On the one hand, these the ages of 4 and 65. We choose TK because it is services alleviate childcare constraints. On the covered consistently in the PODES data during our other hand, they are likely to improve early- study period. childhood development. Some women may seek to enroll their children in preschools to achieve both WHAT DID WE FIND? objectives, others may do so only for educational Public preschools are cheaper to attend than reasons. These women are not employed due private ones to other reasons than childcare constraints. Only a small minority of TKs (3,377 out of 67,770, or less They are likely to be wealthier and able to afford than 5%6) are funded and operated by the government, private as opposed to the free public preschool. and parents do not need to pay any tuition fees. Parents Thus, although they may use private preschools may have to pay some additional charges in public to enhance the early education of their children, schools, but they are significantly lower than those in preschool availability does not affect their decision private schools (Figure 3). to work. FIGURE 3: ANNUAL COST OF ATTENDANCE FOR PUBLIC AND PRIVATE PRESCHOOLS Registration Fees Other scheduled fees Books/writing supplies Transportation costs Other school expenses Special Courses Exam Fees public private IDR 0 20,000 40,000 60,000 80,000 Source: IFLS 2003 5 The age restriction is not strictly enforced and TKs typically include children between the ages of 3 and 6. 6 PODES 2005. 7 Both PODES and SUSENAS from 2014 were used. FIGURES 4 & 5: IMPACT OF AN ADDITIONAL PUBLIC PRE-SCHOOL PER 1000 CHILDREN ON EMPLOYMENT OF MOTHERS ACKNOWLEDGMENTS IMPACT OF AVERAGE ADDITIONAL AVERAGE ADDITIONAL FLFP PUBLIC FLFP We gratefully acknowledge PUBLIC PRESCHOOL 6.9% - ADDITIONAL PRESCHOOL 13.3% (UPPER BOUND) PUBLIC comments and inputs of 9.6% PRESCHOOL (LOWER BOUND) colleagues in the Jakarta Poverty & Equity Global Practice, especially Ririn labor force participation rate of labor force participation rate of mothers of children in eligible ages women with children under age 3 Purnamasari, Jonathan Lain and Daim Syukriyah, Impacts of public preschools on employment extend beyond the period when and the Africa Gender children are age-eligible for preschool Innovation Lab. EAPGIL is supported through We also find that improvement in access to public preschools is associated with an increase in employment of women with children under three, compared to women the World Bank Group’s without children or children at least 18 years of age. An additional public preschool Umbrella Facility for per 1,000 children increases employment among these women by 3.6 to 5 Gender Equality (UFGE) percentage points8 (Figure 5). ). Based on the current employment rate in this group in partnership with the of women, this means that building an additional public preschool likely enables Australian Department of 27-37 women to find employment9. Foreign Affairs and Trade. The UFGE has received Why might preschool availability affect women whose children are not in the eligible generous contributions age range? If a woman knows that the option of a public pre-school will exist in the future, she faces the need to find a childcare solution only for a relatively short from Australia, Canada, time. Hence, she may be less likely to drop out of the labor force. In the absence of Denmark, Finland, the preschool, there is a need to find a childcare solution for a longer time period – Germany, Iceland, the until children are 7 and can start primary school. In this case the costs of childcare Netherlands, Norway, may outweigh the benefits of remaining in the labor force. Spain, Sweden, Switzerland, the WHAT ARE THE POLICY IMPLICATIONS? United Kingdom, and the United States. We find that public preschool expansion in Indonesia increases women’s employment by 13.3 percent. We also find evidence of effects beyond the age-eligible group: access to public preschools increases the likelihood that mothers of children under 3 (below the eligibility cutoff) work. Overall, these findings suggest that one additional public preschool per 1,000 children is associated with approximately 89 more women employed. These findings highlight the role that public preschool expansion can have in increasing FOR MORE INFORMATION women’s employment in Indonesia. Notably, we do not find impacts of private preschool expansions on women’s employment. Future research should provide more empirical Elizaveta Perova evidence on why positive impacts on women’s employment are limited to public eperova@worldbank.org preschools only. If our hypothesis that public and private preschools serve different Helle Buchhave populations is confirmed, this analysis will also indicate which groups of women are hbuchhave@worldbank.org more likely to take up and benefit from public preschools. This information will help policy http://www.worldbank.org/eapgil makers better target preschool programs, or create subsidies that may enable poorer women to take advantage of private preschools. Depending on specification. 8  Based on PODES 2014 and SUSENAS 2014. 9