Phnom penh: A new World Bank study has identified accessible and affordable childcare as a high-return investment that Cambodia can make to improve the quality of women's work - and help them keep their jobs. The study also finds that childcare investment would boost the human capital base needed by Cambodia's demographic dividend of a young and expanding workforce unlike most economies in East Asia.
According to Agence Kampuchea Presse, the study highlights that Cambodia has one of the highest female labor force participation rates in East Asia and the Pacific at 74 percent. Despite this, women perform approximately 90 percent of unpaid domestic and care work-one of the highest rates in Southeast Asia-and are disproportionately concentrated in informal employment. Many women express that they would seek employment, or better employment, if reliable, affordable childcare were available, yet formal care for children under three remains low.
The study notes that formal childcare is used by only around 3.2 percent of children under three, leaving the vast majority of families reliant on informal care arrangements. Based on potential demand, the bank estimates that childcare could account for almost 400,000 jobs in Cambodia by 2030, with care for the elderly requiring a further 150,000 workers. Studies in 22 countries suggest that women's participation in the labor force may already be high in poorer economies as informal work is compatible with caring for children simultaneously.
The real gains from childcare provision come through shifts in the type of work women do: from subsistence agriculture or petty trade into formal employment with better wages, hours, and protections such as parental leave. This transition is precisely what Cambodia needs, according to the bank.
The study also notes the potential benefits from increased childcare investment under a sub-decree on the Management of Nurseries issued in December last year. The sub-decree regulates community, enterprises, and private nurseries caring for children from birth to less than six years of age, aiming to ease the burden on parents so they can remain economically active.
To estimate costs and returns for the public and private sectors implementing the sub-decree, the bank has conducted a cost-benefit analysis. The analysis finds that benefit-cost ratios could range from 3.3 to 10.0, with the strongest benefits arising from sustained maternal employment and improved child development outcomes. However, implementation remains the central challenge, with 72 percent of assessed factories not complying with existing requirements.
Priorities include factory inspections, helping employers assess needs, guidance and incentives for setting up on-site or cluster-based centers, and piloting flexible operating hours. For firms, childcare is not only a compliance obligation but a productivity investment, as employer-supported care reduces absenteeism and turnover and improves retention of experienced female workers. Expanding access to early childhood education is equally important, with Cambodia still lagging regional peers in this field.
The bank urges Cambodia to develop certified studies for both child and elderly care as part of the technical and vocational education and training (TVET) curriculum. A trained childcare workforce underpins both service quality and the implementation of Cambodia's childcare policy framework. Indonesia and the Philippines are already developing structured training pipelines to meet that demand, with the childcare sector potentially creating 20 million jobs in East Asia and the Pacific by 2030.
Cambodia, whose population will begin aging in a couple of decades, has both the demographic profile and a limited window to compete for this market. The question is whether it builds the institutional foundations to do so before the opportunity is claimed by others.