In the United States, working-class women rely on child care to keep them in the workforce. But the industry is plagued with long-term issues such as high tuition prices, low early educator wages, and decreasing program supply.
The looming cutoff of ARPA stabilization funds will force some programs to close, and children in those communities will lose their day care spots. This could cost state economies and families millions in lost earnings.
1. Child Care Providers Are Leaving the Workforce
The child care crisis has had a ripple effect that has taken its toll not only on families, but on the economy as well. According to research by the nonprofit group ReadyNation, last year the lack of affordable and available child care cost the nation $122 billion, a figure that includes lost wages, reduced productivity and diminished state, local and federal tax revenue.
The lack of reliable childcare has also caused working parents to miss work, reducing their wages and depressing job creation. This is particularly damaging to women, who are the majority of working parents. In fact, the number of workers missing work due to child care problems surpassed pre-pandemic levels in October.
In some states, child care providers have even closed their doors because they can no longer afford to pay their employees. This has led to an increase in families seeking care outside of the licensed system, where they typically pay more per hour and are subject to stricter inspection standards.
As more child care workers leave the workforce, it is expected that quality will suffer and prices will continue to rise. The good news is that the pandemic emergency relief funds have helped to stem the tide of this crisis by providing child care with tuition waivers, stipends and reimbursements. But once these funds expire, the long-term problems will likely resurface.
Many of these long-term problems stem from the fact that child care is a public good, but unlike public schools and fire departments, it does not receive a significant amount of public money. As a result, it relies on parent fees to operate. And this model is not sustainable. Parents, especially mothers, can only take so much of a hit to their family budgets before they look for alternatives, such as working from home or going back to school to get a degree that will help them find better-paying jobs.
The lack of affordable and reliable child care is causing working parents to lose hours or drop out of the workforce altogether, hurting the economic recovery. The need for quality child care should be treated like a national priority and federal investment is needed to ensure that America’s children and families have access to the child care they deserve.
2. The Cost of Child Care is Increasing
Despite the economic recovery, many families are still struggling to find quality child care. While the number of child care centers and in-home providers has stabilized since the pandemic’s height, costs have skyrocketed—up an average of 47% for licensed care and 70% for home-based care. These price increases are outpacing the inflation rate, making it harder for families to afford the necessary care. The child care crisis threatens to derail the labor market’s jobs recovery. In major cities, the number of workers who drop out of work because they can’t find affordable care has spiked. In San Francisco, for example, the figure has doubled in just seven months. The same pattern is playing out across the country.
The COVID-19 pandemic revealed just how broken America’s child care system is. It’s expensive and unstable, leaving parents to juggle childcare with a tight job market that pays them too little to cover their expenses. Moreover, the lack of access to high-quality child care keeps too many working women out of the labor force altogether, further jeopardizing family economic security.
It’s clear that we need to do something about child care. Unfortunately, the solution won’t be easy. While states have done great work stabilizing their child care sectors with ARPA and other emergency relief funds, those investments will end in 2023. That cliff will have dire consequences for children, families, and state economies:
The federal government has the power to address these problems. The bipartisan Child Care for Working Families Act, championed by Senator Patty Murray and Representative Bobby Scott, would reduce costs and improve accessibility in child care “deserts,” while addressing long-term issues that existed before the pandemic. But the bill will face tough odds in the Republican-controlled House. It’s time for Congress to step up and pass a comprehensive bill that puts children and families first. The nation cannot afford to wait any longer.
3. Child Care is a Basic Right
When asked what the most important characteristics of quality care are, parents report that they want a safe and reliable option that fits their schedule. This means options available in the evenings and on weekends, when many working parents are busy. It also means options that are affordable, including for families in low and middle income brackets, and that are located in areas where child care slots are scarce. Policymakers should offer flexible financial assistance options that provide extra incentives for providers willing to provide these types of high-quality care options during non-standard hours — but only if they are willing to meet quality and health and safety standards.
While state policies can make a difference, federal funding is essential to ensuring that children and their parents have access to quality child care. The administration’s Build Back Better plan includes proposals that would increase federal child care funding, particularly through subsidies to ensure that low- and middle-income families don’t pay more than 7% of their income on child care. These efforts are critical to addressing the child care cliff and enabling families to work, invest in their communities and grow the economy.
The COVID-19 pandemic revealed just how broken the nation’s child care system is. It costs parents too much, pays workers too little and, as the map below shows, more than half of the country lives in a child care desert.
Child care workers like Jessica Colagrosso need our help to save their jobs and their livelihoods. She knows firsthand that elected leaders need to understand that without affordable options, people can’t go to work. That’s why she and other child care advocates have pushed for expansion of the ARPA funding that saved child care during the pandemic.
This fund, along with other emergency relief programs that will expire at the end of 2022, must be extended. If they aren’t, states will be forced to make deep cuts to child care and early education, resulting in mass job losses, program closures and more families in search of safe, quality options. The only way to avoid this is for Congress to act now.
4. The Child Care Crisis is Disrupting the Economy
The child care crisis isn’t just hurting children and families, it’s causing significant economic damage. A study by the progressive think tank The Century Foundation found that parents are losing work because of problems with child care and that it could cost businesses and states billions. This is because the loss of child care means that parents cannot work, are forced to cut back on their hours or quit their jobs entirely. This will also have a negative effect on the economy because it cuts into workers’ income and tax revenues for businesses and state governments.
This is why it’s so important that Congress act now to protect the current investment in child care. Without Congressional action, the ARPA stabilization funds that helped save millions of children’s access to child care will expire on September 30. The loss of this investment will have a devastating impact on families, communities and the economy across America.
The emergency relief programs distributed by the federal government during the pandemic are making a clear case that public investment, not “the free market,” is the key to keeping child care providers in business and providing quality child care for American children. The distribution of these emergency funds through tuition waivers, stipends, reimbursements, and expanded eligibility have proven that when public support is available, it can keep children in day care and parents in the workforce. If we revert to the status quo, where child care is left solely to private markets, it will be impossible to avoid long-term disruptions and instability in this essential sector.
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