Since the Prime Minister announced an easing of coronavirus lockdown measures from 1 June, providers have been assessing what safety measures need to be put in place to minimise the risk of infection and how many children are likely to return.
Both are crucial factors for providers to decide whether a setting can or should reopen.
However, with uncertainty surrounding the impact the pandemic will have on employment levels, early years experts are concerned some settings will not reopen immediately and may be deemed unviable in the longer term.
“A lot of providers are focusing on the immediate needs, but there could be a bigger impact in the medium term,” says Sara Bonetti, director of early years at Education Policy Institute. “It won’t be like switching on a light – there are definitely some settings that won’t reopen and others that will have low numbers of children.”
Uncertainty over levels of demand will make it hard for providers to plan their provision, adds Bonetti, “because there are parents who have a place but want to keep children at home for longer due to safety concerns, and others who have lost their jobs and can’t afford to go back”.
“For settings, it is going to be really hard to know how many staff to bring back from furlough and to decide what to do when that scheme finishes,” she says.
The government has extended to October its furlough scheme – which sees the taxpayer pick up the bill for 80 per cent of an employee’s wages up to £2,500 a month – but Jo Verrill, managing director of Ceeda Research, expects the financial pressure on childcare settings to grow as the scheme comes to an end.
“The worst period will be September to December,” she says. “Employers are being supported at the moment, but as this falls away, occupancy of nurseries could drop off and is unlikely to come straight back.”
Faced with such uncertainty, it is likely that some childcare staff may look elsewhere for work, says Bonetti, particularly with supermarkets hiring large numbers due to high demand.
Verrill agrees, warning that rising demand for adult social care jobs could be another factor.
“I expect redundancies,” she says. “Occupancy levels will not be sufficient to recruit staff and by the time it picks up – people will have moved on. Demand for social care is not going away, it’s better paid than early years and it’s an easy transition to that for childcare staff.”
Their concerns are shared by many providers. A poll of 3,000 nurseries, childminders and pre-schools in England by the Early Years Alliance in early May found that a quarter thought it “likely” they will close permanently within the next 12 months.
Meanwhile, nearly half of settings anticipated making redundancies due to financial support by the government being insufficient to cover costs.
Ceeda’s own research shows that 37 per cent of nurseries and pre-schools and 52 per cent of childminders were open on 1 May, with the average setting caring for just half a dozen vulnerable children or those of keyworkers.
With so few children, it is unsurprising that so many providers are closed – early years consultant James Hempsall estimates the figure could be as high as three-quarters (see box).
If some settings do not reopen due to the uncertainty over demand, a situation could arise where there is a shortage of places available in some areas once lockdown is lifted. The most disadvantaged areas are likely to be hit hardest, warns Verrill.
“Providers are heavily reliant on income from funded places, but if children aren’t attending and that continues, I’d expect to see some damage to provision in deprived communities,” she says.
Verrill also questions how places will be allocated when settings may have to ration the number of children to ensure they comply with social distancing requirements. “How do providers manage that process?” she asks.
Verrill says local authorities can play a crucial “surveillance” role in ensuring sufficient places are available in the right areas.
Bonetti agrees, adding that this could extend to councils helping families that need childcare to find places and supporting settings to recruit staff “as they are in touch with what the local workforce situation is”.
“Some authorities already have an early years workforce database which could help providers recruit staff in the post-Covid period,” she adds. “Recruitment is expensive and early years is a very localised labour market, so councils are in a good position to help.”
Verrill says councils should learn from providers that have been operating during lockdown.
“Some settings that have remained open and looking after children of keyworkers have a lot of insight and understanding of the challenges,” she says.
“Authorities have got to be having a dialogue with these providers.”
EXPERT VIEW: Four key ways local authorities can offer help and support to the childcare sector
James Hempsall, director, Hempsalls
Any business seeking to survive the pandemic has navigated the financial support schemes, many of which, I must admit, greatly exceeded my expectations.
However, it is a complex web, and recent changes have not made things any simpler. This is job one for local authorities: to share the best and most up-to-date information, and do more by helping the journey through what applies to whom. We mustn’t allow any setting to fall between the cracks of myths and misinformation.
Local authorities retain childcare sufficiency duties (Childcare Act 2016) for all children and are responsible for monitoring demand and capacity – the market management role. The market will ebb-and-flow through the dynamics of economic change and in and out of lockdown. Managing a childcare business in these times will be hugely problematic. Juggling business capacity and sustainability, income, demand and need will be a constant.
Councils, with government support, must take action now, and be prepared and ready to support the sector’s recovery as the effects of the pandemic unfold. How this is done will affect and enable parental employment, children’s learning, and early help. We recommend a four-strand strategy for councils:
1. Information. Providing a reliable and up-to-date source of information to inform providers’ business choices, decisions and actions. Investing time and resources to digest, analyse and summarise data. This will inform guidance as well as signpost and refer providers to other sources of information.
2. Tools. Making available a set of useful tools and resources to help providers take action, including bespoke tools and signposting to others available.
3. Support. Being available for support on demand through email, telephone or video conferencing. Support can be to problem solve, clarify information, and/or support the use of tools.
4. Intervention. Making available targeted intervention to support action planning through emergencies and crises. Support where settings are identifying serious sustainability issues must be available, especially in areas where there is a sufficiency need. Signposting to financial assistance to resolve problems will be required.