The knock-on effect has been a rise in fees for parents, lower profits for nursery owners and a squeeze on staffing.
The report, published last week by IDS, the information and research service on employment issues, found that starting pay for nursery assistants and nursery nurses has risen by around 11 per cent in the past two years.
The UK-wide survey carried out in March 2004 covered 100 nurseries ranging in size from a small provider with four employees to a large chain of 1,600. Around 90 per cent were private sector day nurseries and the remainder were not-for-profit community nurseries.
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