Childcare pay rise: Anthony Albanese announces boost for staff to keep workforce stable

A 15 per cent pay rise over the next two years to early childcare staff will ensure the workforce in the sector remains stable, the prime minister says.

A $3.6 billion boost from the federal government means early childcare and out-of-school hours staff are in line to get a 10 per cent raise from December, followed by a further five per cent from December 2025.

Staff will only be able to receive the wage boost if childcare centres agree to cap fee increases to parents at 4.4 per cent.

Prime Minister Anthony Albanese said the pay rise would ensure those working in the industry have decent wages and conditions.

“The Productivity Commission inquiry has shown that unless we do something about wages in the sector, we won’t have a workforce,” he told ABC TV on Thursday.

“What (childcare workers) do is to create better, smarter, more capable Australians, and they deserve recognition for the hard work and commitment that they put in.”

Workers on the average wage will receive a pay rise of $103 a week from December, rising to $155 more per week following the December 2025 increase.

The 15 per cent rise is, however, less than the 25 per cent wage boost educators had been asking for ahead of the federal budget in May.

Mr Albanese said the wage rise would have a flow-on effect for the rest of the economy.

“Childcare is important in boosting the economy because it boosts workforce participation, and all of that will assist with the economic objectives that we have,” he said.

“What this will do is give childcare workers the wages that they deserve.”

The federal government also confirmed it received the final report from the Productivity Commission into early childhood, which is due to be released publicly in the coming weeks.

A draft report from the commission released in November recommended the government provide universal access to childcare for up to 30 hours a week for all children aged up to five.

Australian Childcare Alliance president Paul Mondo welcomed news of the pay rise.

“We have been working for a long time for this announcement and while there is a lot more for us to determine, this is a very positive step in the right direction,” he said.

“The only meaningful way to implement improved wages for our workforce is through government funding to ensure that families are not left out of pocket.”

While the Australian Education Union said the move was a good step, its Victorian branch president Meredith Peace said more funding was needed.

“Early childhood teachers and educators are also looking to the federal government for additional investment for the inclusion of entitlements that address workload,” she said.

“With 11,000 more teachers and educators required in Victoria over the next decade, professional pay and good working conditions are key to attract and retain this growing workforce.”

Director of early childhood group Thrive by Five, Jay Weatherill, said the wage move was a crucial step to ensuring universal childcare.

“Better, fairer pay will help keep educators in the sector and attract new people to the profession,” he said.

“A well-resourced and well-staffed early learning sector will enable many more families to access early learning and care.”