The latest figures from the Childcare and Early Years Provider survey show that over the last four years, the number of providers has fallen by 6,600, the equivalent of 10 per cent.
According to the data, the drop in the number of providers is largely down to a loss of childminders, with 8,000 leaving the profession between 2018 and 2020. As of this year, there were 28,500 childminders, down from 36,500 in 2018. The number of school-based providers increased by 13 per cent over the same period however, while the number of group-based providers stayed roughly the same.
Despite this, the number of registered childcare places has continued to increase from a total of 1,518,400 in 2018 to 1,568,500 this year.
The Early Years Alliance said it was ‘unbelievable that the Government is still insisting all is fine in the sector in the face of report after report showing the number of settings plummeting.’
Key findings from the survey include:
- Between 2021 and 2022, the total number of providers fell by 2,000 (3 per cent) from 62,000 to 60,000. The decline in the overall number of providers is explained by a 9 per cent fall in the number of childminders in a year, from 31,200 in 2021 to 28,500 in 2022.
- The number of childcare places increased by nearly 15,000 (1 per cent) between 2021 and 2022 to 1,568,500.
- The number of staff working in early years settings increased from 328,500 in 2021 to 339,800 this year.
- Between 2021 and 2022, there was an increase in the proportion of group-based providers employing an apprentice.
- 11 per cent of childminders who responded to the survey said they had a second job to supplement their income.
- In 2022, 91 per cent of group-based providers and 89 per cent of voluntary group-based providers reported that they were operating at, or above, statutory ratios for children under the age of two.
- In 2022, private group-based providers were the most likely to have increased fees in the last 12 months. 79 per cent had increased fees for children under 2, 70 per cent for fees for children aged two, and 69 per cent for children aged three and four. However, fees have remained below inflation.
- Staff wages continue to account for the large majority of costs for providers.
'The current system isn't working for anyone'
Neil Leitch, chief executive of the Early Years Alliance, said, ‘Ministers continue to trot out the same old arguments: that they are investing record amounts in the sector and that the number of places across the country has remained broadly stable.
'But more money isn't the same as enough money, especially in times of record inflation, and the fact that the number of places has remained roughly the same nationally will be of little comfort to parents finding it impossible to access childcare and early education provision in their local area.
‘The current system isn't working for anyone – not for families, not for children and certainly not for providers. The early years sector in this country is in crisis – and the longer the Government pretends otherwise, the worse the situation is going to become.’
The National Day Nurseries Association (NDNA) warned that with wage bills making up 76 per cent of the total costs for nurseries, the increase in the national living wage in April will ‘hit providers extremely hard’.
Chief executive Purnima Tanuku said, ‘The data demonstrates that nurseries are trying hard to keep unavoidable fee increases under control. Although fees have risen it’s been by a below-inflation average of 3.2 per cent for three- and four-year-olds.
‘The new funding rates must take the increase in minimum wages in April and other soaring costs such as food and energy into consideration.
‘It’s no surprise that nurseries have seen an increase in the numbers of apprentices, temporary and voluntary staff as they struggle to recruit and retain qualified staff.’
Findings from the Childcare and Early Years Provider Survey 2022 are available here