As nursery proprietors and managers look to the New Year, do they see 2002 as a time to expand and take advantage of low interest rates and a static property market, or as a period to consolidate and counter the threat of recession, or even a time to contract?
A straw poll of nursery managers from across the country found people very positive about prospects for the coming year. Most reported that the benefits of low interest rates outweighed any anxieties about the economic outlook. Indeed, it seems that recession is not necessarily a major problem for childcare settings. Historically the sector has survived, and by some criteria prospered, during previous downturns in the economy.
Sarah Carr, a director of Lancashire-based Kindercare, who chairs the National Day Nurseries Association, says, 'I think the sector is quite buoyant and positive. The fact that interest rates are so low is a great help. I remember the days when they were at 15 per cent.
'Certainly, from talking to people within the sector who have been through recession, it would be a brave statement to say the sector is recession-proof, but people remember business being very strong throughout the last recession.
'The signs are extremely good. Our sector has become high-profile and funding for investment is available everywhere. Venture capitalists are desperate to get involved in funding the sector and the Government has done some work to encourage the banks to make more money available.' Susan Hogg, a director of the Cardiff-based Acorns Nurseries, says, 'We are expanding next year. We feel optimistic but we are not complacent. Our nurseries are full, with quite extensive waiting lists. If there is a recession it will probably mean more women have to go back to work, so the demand for childcare could increase. The last recession did not hurt us. It may well be that as more mothers go out to work, we fill more of those difficult-to-fill part-time slots such as Friday afternoons.' Maureen Gard, a director of Puffins of Exeter, says, 'The feeling in the West Country is quite positive. Certainly we are going to expand. Even in Torbay where the town has suffered some job losses in the last few months, the nurseries are quite positive.
'Rosalind Taylor and I started our business in 1990 in the recession and survived. When people are worried they do not tend to start chopping and changing jobs, so they are less likely to move and change their childcare arrangements.'
Tracy Seed, childcare director of Saplings, says, 'Obviously, the economic mood is affecting some businesses. There has been an increased sense of uncertainty at the news of a potential recession and the events of 11 September. On the other hand, if the main breadwinner feels their job is under threat, the other partner is more likely to seek employment and then more childcare is required.'
A harsh lesson for workers to learn at a time of rising unemployment is that a secure job, even if it is not particularly well paid, is a better prospect than a higher profile but more precarious one. So if redundancies become routine in other professions, the childcare sector might well attract talented and ambitious young recruits.
Sarah Carr says, 'When other industries are struggling and people are being laid off, that can give us opportunities with people looking for career changes. I know some of the NDNA members in south-east England have approached people like British Airways to talk to them about career changes for their staff.'
But Dr Julian Cook, a director of the Happy Child nurseries in London, sounds a note of caution. 'We have been running nurseries for 11 years and we expanded through the last recession. We are planning to expand next year. The difference between this potential recession and the last one is that there is more competition in the sector and so it is likely that the nursery sector will suffer more now.
'There has been a slowdown in the take-up of places in the last three to four months, but it is difficult to say whether that is due to recession or to the transfer of registration and inspection to Ofsted. The local social services used to send out a quite comprehensive list of nurseries but they are not doing that any more, and parents don't really know where they are supposed to go to find the information.'
Maureen Gard says one of the biggest challenges facing nursery managers is the perennial problem of finding high-calibre staff. Her nursery chain copes through a series of initiatives to retain staff and reduce turnover, such as running an employee-of-the-month award, giving a long-service bonus and establishing a staff social and welfare fund.
Tracy Seed says Saplings aims to retain its staff by offering a generous employment package in terms of pay, sick pay, holiday leave and subsidised childcare places. 'We are pro-actively setting up other strategies and incentives to recruit and retain staff - for example, we are actively seeking older people and men.'
But one nursery owner who wishes to remain anonymous is seriously considering contracting in 2002 because of the lack of skilled staff. 'I know I have the skills to deliver early years care and education to a high standard, but I am becoming increasingly concerned about the competence of my staff to deliver quality.
'The number and quality of students going in to college have fallen, as has the calibre of students coming out of college. Other applicants are few and far between, and older women want to be paid more. The recruitment crisis is now so acute in my area that I'm seriously considering downsizing.' Sarah Carr says the emphasis the Government has placed on childcare through initiatives such as the national childcare strategy, coupled with more investment through the early years partnerships, has raised the sector's profile. But other managers complain about the burgeoning mountain of paperwork attached to every initiative. One says, 'Some of the demands for information are ridiculous. After the election, since the Government changed the name of the DfEE to the Department for Education and Skills, we have been required to fill out forms again with the new heading. It is just the same information but on a new form.'
Maureen Gard says, 'In the past the owners of small nurseries could work with the children, but the majority of them have not got time now. Every nursery needs an administrator.' NW
