Child Care:

Child Care Subsidies Increase Likelihood That Low-Income Mothers Will Work

HEHS-95-20: Published: Dec 30, 1994. Publicly Released: Dec 30, 1994.

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Pursuant to a congressional request, GAO reviewed whether child care subsidies increase the likelihood that low-income mothers will work, focusing on the probability that poor and near-poor mothers will work as their child care expenditures change.

GAO found that: (1) reducing child care costs increases the likelihood that poor, near-poor, and nonpoor mothers will work; (2) providing a full subsidy to mothers who pay for child care could increase the proportion of poor mothers who work from 29 to 44 percent, near-poor mothers who work from 43 to 57 percent, and nonpoor mothers who work from 55 to 65 percent; (3) affordable child care is a decisive factor that encourages low-income mothers to seek and keep jobs; and (4) any effort to move more low-income mothers from welfare to work will need to take into account the importance of child care subsidies to low-income working families.

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