Does Part-Time Employment Help or Hinder Lone Mothers' Movements into Full-Time Employment?

Abstract

In common with many developed countries, Australia has experienced substantial growth in the number of lone parent families, leading to considerable policy focus on reducing welfare dependence among lone parents. A key issue that arises in pursuing this policy goal is whether, in the context of a welfare system that accommodates the combining of part-time employment with welfare receipt, part-time employment helps or hinders progression to full-time employment. We investigate this issue using panel data on single mothers, estimating dynamic random effects multinomial logit models of labour force status that distinguish part-time employment, allowing investigation of whether part-time work represents a ‘stepping-stone’ to full-time employment. Evidence in support of the stepping stone hypothesis is found. Part-time employment on average increases the next-year full-time employment probability by five percentage points. No evidence is found that this stepping stone function varies by number of children or age of the youngest child.