No activation without reconciliation? The interplay between ALMP and ECEC in relation to women employment unemployment and inactivity in 30 OECD countries 1985-2018

Comparative welfare state research has mostly examined the outcomes of active labour market policies and work-family reconciliation policies separately. As a result, potential complementarities between these policy areas have received scant attention empirically. Using macro-level data, this study answers the question to what extent, and in which way, governments’ efforts in active labour market policies (ALMP) and in early childhood education and care (ECEC) services are correlated with women’s employment rates, women’s unemployment and inactivity rates in 30 OECD countries from 1985 to 2018. The article theorizes about how the various policies that constitute a welfare state relate to each other, distinguishing between pluralism, complementarity and substitutability. I interpret the empirical findings as being consistent with welfare pluralism, in the sense that ALMP and ECEC policies work together in improving women’s employment rates in slightly different ways: ALMP is associated with low female unemployment rates, whereas ECEC also is associated with lower inactivity rates for women. There was, however, more support for the notion of substitution rather than complementarity: the marginal benefits associated with an increase in either ALMP or ECEC were smaller in the context of large investments in the other policy. In other words, the highest rates of women’s employment, and the lowest rates of unemployment and inactivity, are found in countries with large investments in both ALMP and ECEC, but such higher investments are associated with diminishing returns.