Laing & Buisson estimates that the UK children's day care nurseries market was worth £3.2 billion in 2004. Like the broader childcare sector, the children's nurseries market has grown rapidly in the last 10 years, and is now more than seven times the size (in nominal terms) than at the end of the 1980s.

Increasing demand for nursery services and general childcare from working mothers has driven market expansion. The key factors driving demand include delayed family formation, increased female work participation, and a shift in preferences from parents towards childcare and early years education. Private individuals in the UK spent an estimated £2.7 billion (84% of total market income) on children's day care services in 2004. Average fees paid were estimated at £134 per week at January 2005.

Market size

A total of 13,570 children's day nurseries in the UK provided 630,525 places for children between 0 and 8 years at January 2005. Average occupancy for the UK was 83%. Over the past ten years, total nursery sector capacity and demand for nursery services have grown rapidly, concentrated solely in the independent sector (private and voluntary providers) at a time when local authority provision has been decreasing, though local authority provision has started to grow again. Growth in nursery places has outstripped growth in the number of nurseries, as the average size of nurseries has been increasing, but average attendance has remained static.

Market structure

The structure of the nursery market remains fragmented and dominated by stand-alone for-profit nurseries. However, for-profit nursery groups (major providers) are gaining market share and this trend is set to continue. Major providers operating nursery groups (3 or more nurseries) account for 9% of total places. Expansion of the nursery market in recent years has been driven by organic growth of existing nursery groups, and a strong consistent number of new entrants.

Top five major providers of children's nurseries at March 2005
	Nurseries	Places
Nord Anglia Nurseries	101	10,318
Asquith Court	114	6,847
Just Learning	66	5,724
Bright Horizons Family Solutions	90	4,436
Kidsunlimited	46	4,086

For further information see:

Childrens Nurseries - UK Market Sector Report 2005
Nursery & Childcare Market News