A total workforce of 350,000, across an employer base of 17,000 makes the formal Childcare sector a relatively small market for recruitment and staffing agencies. A fragmented market dominated by small firms means there is scope for consolidation.
With the 2010 change of government the Childcare sector has faced much uncertainty since many long term strategies that were outlined by the previous administration are no longer being carried forward.
Regulation and government intervention will almost certainly be modified and this could well affect levels of staff qualifications required.
However, in the long run, this sector will have to grow to meet the demands of parents returning to work as the UK emerges from recession. It is likely that the main increases in demand will continue to be for full day care for 3 and 4 year olds which is where growth has been focused for the last decade.
As there are relatively low barriers to entry for new childcare providers, it is unclear whether this growth will take the form of new small firms entering the market and continuing the fragmented nature of the sector.
Alternatively, market consolidation may accelerate and larger firms may begin to expand. Which of these scenarios emerges will depend significantly on local and national government support for childcare.
In either case, the provision of qualified staff to this growing sector does present a market opportunity for agencies.