2018 high cost of child care report released

If you are a parent or know one, you may already be aware that the cost of child care in the United States is exceedingly high. Child Care Aware of America explored this issue in its recently released 2018 report, “The US and the High Cost of Child Care: A review of Prices and Proposed Solutions for a Broken System.”

The report includes a map that breaks down state-specific (and some county-specific) costs. It also concludes with policy recommendations, including sustained funding for the Child Care Development Block Grants (CCDBG) and increased funding for the 21^st Century Community Learning Center initiative.

To understand a snapshot of the need for thoughtful policy around quality, affordable childcare, here are some numbers from the report to keep in mind:

Cost

• 10.6 percent represents the average percent of income spent for just one child for married couples with children under 18; the average percent income for cost of care is 37 percent for a single parent.
• $9,031 is the top cost for summer care. During the three months when school is out in the summer costs for full-time child care can be as much as $9,031, as they are in Illinois, the most expensive state.
• 28 states and D.C. currently have annual child care costs that exceed in-state tuition costs for the state’s public university.

State of Investment

• 0.3 percent of US gross domestic product (GDP) is spent on the early childhood education, placing it in the bottom five of least affordable nations within the OECD members.
• 23 percent of public college education costs are directly paid for by parents in the US, while 60 percent of child care costs are paid for directly by parents.
• 5 in 6 children are eligible for child care subsidies but do not currently receive them.

Effects of Underinvestment

• $4.4 billion in revenue is lost by businesses annually when childcare breakdowns require working parents to miss work.
• 15 percent or more of some states’ employees must change work at some point, as a result of child care issues.
• 53 percent or only about 1 in 2 women with elementary-aged children are employed full-time.

Impacts of Policy Change

• 40 percent of women who receive assistance for child care are more likely to have stayed in the same job two years later.
• 60 percent of employee turnover could be reduced with access to affordable childcare.
• 83 percent of millennial parents would be willing to leave their job if another offered more family-friendly benefits.

What about child care professionals and program quality?

Workers in the child care sector are paid an average of only $10.72 an hour, and 15 percent of child care workers live in households with annual incomes below the poverty level. These workers are critical for youth development, including early ages where children’s brains are developing the fastest and low staff-to-child ratios and quality adult-child interactions are so crucial. Cost-benefit analysis found $4 to $16 dollars in returns for every dollar spent, and these findings especially true for low-income families. A focus stepping up provider quality is essential for improving program outcomes and supporting professional longevity.

Policy Recommendations

This year’s pointed report title change from “Parents and the High Cost of Child Care” to “The US and the High Cost of Child Care” represents the societal benefits shared between families, businesses, communities, and governments alike when high-quality care is a multi-stakeholder endeavor. It’s cliché but true that children represent the America of tomorrow—those whose work and accomplishments will both sustain and progress our society.

At the federal level, policy recommendations include a more integrated system of support, including strengthened or expanded tax credit policies (e.g. the Child Tax Credit, Earned Income Tax Credit, Child and Dependent Care Tax Credit, and the Employer Provided Child Care Credit). The report also recommends continued and increased support for funding streams, such as: 21^st Century Community Learning Centers, CCDBG, Temporary Assistance for Needy Families, Social Services Block Grant, Head Start and Early Head Start, and the Child Care Access Means Parents in Schools program.

Some state and local solutions included special taxing districts, community levies, and enacting state-level tax credit policies that mirror federal ones (which more than 20 states have). The state of Louisiana, for example, offers a refundable tax credit to families with low incomes who choose higher-quality care for their children; to teachers to increase credentials; to programs to increase quality; and to businesses who support eligible child care expenses at child care centers—state policymakers are carefully evaluating the results of the incentives. Communities like the Parramore Kidz Zone in Orlando created matching grants for federal subsidies to improve quality care, and longitudinal outcomes showed fewer juvenile arrests, a decrease in child abuse cases, and increases in school-age children’s math and reading results. Additionally, business leaders and chambers of commerce can be cultivated as important partners both as advocates and to create their own solutions, as is the case with Pennsylvania’s early Learning Investment Commission.

Healthy, well-cared for children are in everyone’s best interest, as the report concludes. Now it’s up to us to help move the best policies to support quality, accessible, affordable care. Read the full report here.

(Note: Child Care Aware represents the Child Care Resource and Referral agencies which assist parents in finding quality care and can help programs with questions and resources for their state. Statewide afterschool networks are another resource in identifying school-age care.)