In a recent study conducted for the Office of Advocacy of the U.S. Small Business Administration, Self-Employed Women and Time Use, Tami Gurley-Calvez, Katherine Harper, and Amelia Biehl offer an important policy suggestion for helping self-employed women earn more – subsidized childcare.
The authors find that women often choose self-employment to meet family obligations, particularly childcare responsibilities. Once self-employed, women work fewer hours than men because of these responsibilities.
While the authors don’t explicitly state that subsidized childcare would help self-employed women more than government set asides or greater access to capital, their implication is clear. Because the main constraint on self-employed women’s earnings is work hours shortened by the need to care for children, subsidized childcare is the best policy.
Policy makers should consider this point when debating what to do to help female entrepreneurs. Childcare subsidies rarely seem to make policy makers’ agendas. But these programs might be just what self-employed women really need.