5 of the World's Best Countries for Working Parents—the U.S. Isn't on the List

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Working parents need all of the help they can get. Some countries are better at providing it than others.

Iceland, for example, is one of the best countries in the world for working parents, according to a new report from Bloomberg, which looks at how nations' policies affect the quality and affordability of child care for working parents.

The country spends a higher percentage of its gross domestic product — nearly 1.8%, according to the Organization for Economic Cooperation and Development (OECD) — on early childhood education and care than any other wealthy nation, Bloomberg notes.

That level of investment helps make child care relatively affordable in Iceland, where parents spend about 5% of their earnings on child care on average, according to OECD data.

By comparison, the U.S. spends just 0.3% of its GDP on early education and child care, and U.S. parents, on average, spend roughly 19% of their earnings on child care costs, according to OECD.

The report identified these five countries as being standout examples of easing the financial burden on working parents:

  • Iceland
  • Estonia
  • Germany
  • Canada
  • New Zealand

In the U.S., widespread child care shortages and rising costs of raising kids are among the factors contributing to increasing rates of burnout among parents. As a result, more parents have been forced to drop out of the workforce since the start of the pandemic, either temporarily or permanently. 

These problems exist everywhere to some degree, but some countries appear more committed than others to providing working parents with enough resources to lighten that heavy load.

It may be worth the investment: Working parents with more resources at their disposal are more likely to stay in the workforce, according to a 2019 survey from the Center for American Progress.

Canada, for example, committed in 2021 to spending $22 billion over five years to bring down early education and child care costs. The country cited research showing that every dollar spent on early years education brings an economic return of up to $2.80, by giving more parents the freedom to contribute to the workforce.

Similarly, Iceland's policies benefiting working parents are one reason why the country has the highest female labor force participation rate among the countries tracked by the OECD, according to Bloomberg. 

More than 82% of adult women in Iceland participate in the country's workforce, as of the most recent OECD data from 2021. That's compared to just over 75% in Canada, and roughly 68% in the U.S.

Most of the countries listed in the report have another important factor in common: They each offer strong child care policies that make early childhood education and care widely available and affordable, if not free.

Children in Estonia between the ages of 18 months and 7 years are guaranteed spot in a child care institution, while German children are guaranteed a spot through elementary school in the country's "kita" child care programs, which are free in some cities.

New Zealand is an outlier, in this regard: Its early childhood education programs are seen as somewhat expensive for parents.

But the country gained high marks in Bloomberg's report for the quality of those programs, and a shrinking gender pay gap — down to just 5%, according to PwC's Women in Work Index — that benefits working mothers.

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