Almost half the US population is struggling to find adequate access to child care, according to a report from the Center for American Progress, and the rate is closer to 60% in rural areas.
During the first two years of the pandemic almost 20,000 child care centers permanently closed — nearly one in 10. Many child care workers lost their jobs or left for better options, and while there has been some recovery, the industry still has approximately 40,000 fewer positions than it did in early 2020.
Congress set aside $24 billion in stimulus funding specifically for child care, to shore up those workers’ salaries, keep family costs low, and sustain industry training programs. However, that stimulus money expired at the end of September, and estimates of additional program closures are now as high as 70,000.
That would represent as many as one in three of remaining child care programs, providing care to some 3.2 million children, per a Century Foundation report. For a nation already struggling with child care shortages, the overall economic impact of that loss could amount to $10.6 billion.
“We have to acknowledge that childcare has now become an essential part of workforce infrastructure,” said Professor Chris Merrett, dean for Innovation and Economic Development at Western Illinois University and director of the Illinois Institute for Rural Affairs. “However, we are not treating it like infrastructure. That means that where it cannot be delivered at a profit, the private sector will not offer affordable, reliable childcare.”
The Costs of Care
Experts, like Robin Phillips, CEO of Child Care Aware of Missouri, point to a number of possible solutions being explored by researchers. This includes government interventions, like more state and federal funding for early child care and education or child care subsidies for parents, as well as employer-led solutions, like on-site care, flexible work scheduling, or benefit accounts that can be used for dependent care.
Each of these strategies, as well as more creative approaches, bump up against the hard economics of the child care industry, where requirements are many and margins are razor thin. If programs had to sustain themselves only through direct revenue — in other words, charge families what it really costs to operate in line with licensing and safety standards, and to train and retain staff — the true cost would be even further out of reach for most parents.
Alternatively, providers can look for ways to cut costs, but there is little room to maneuver when essential labor makes up between 60% and 80% of the budget for typical providers, with standard staff-to-child ratios driving those costs. And that is in an industry where workers often earn less than $16 per hour, lower than the average pay for fast-food cooks or janitors, with greater training requirements.
One can imagine the impact if parents had to pay the entire cost of their children’s K-12 education, and that is for classrooms where it can work to have a 20-to-1 or even 30-to-1 student-to-teacher ratio. That becomes more severe when you look at the ratios required to provide a healthy, nurturing environment for toddlers (10-to-1) and infants (3-to-1).
This also highlights the limitations of one commonly proposed solution: increasing the availability of pre-K programs in public schools. As Phillips explained, that solution siphons off 3 and 4-year-olds, who have a larger staffing ratio, and leaves independent child care providers to stay afloat with only infants and toddlers, as the number of children per staff person shrinks significantly; meanwhile, the average staffing cost per child rises, and that doesn’t even touch on the challenge of allocating overhead costs for a site with fewer children.
A Promising Model
In an environment where raising prices and cutting costs are both unworkable, the remaining alternative is to find other ways to shore up revenue. A surge in government funding offers one option there, but in the case of the pandemic era, a temporary one.
One promising solution might be found in Fairfield, Iowa, a community of 9,416 people. In 2017, responding to a shortage of available day care, the Fairfield Economic Development Association, the Fairfield Community School District, Early Childhood Iowa, and Pathfinder RC&D (a non-profit focused on community development), formed a coalition with businesses from the area and began exploring possible pathways.
Together, they established a steering committee and launched a market study of the existing supply and demand for child care. The research showed the community had a shortage of just under 550 child care spots. This gap was fueling a number of issues, with about 70% of surveyed employers reporting productivity decreases due to absenteeism and 40% reporting trouble even hiring employees.
The coalition came up with a plan that combined grants, business contributions, and a $4.8 million capital campaign. The hybrid funding model included incentives for home-based providers, help for existing child care centers to add new openings, and the design and build of a new child care center. In all, they were able to open almost 300 new spots.
Other small communities with similar child care shortages may not have all the expertise needed to run such a campaign or might lack support of such a broad coalition, but that makes what Fairfield learned and achieved all the more valuable.
“While this child care shortage is not unique to rural areas,” says Merrett, the Western Illinois University professor, “because they have lower incomes in general, the market for private sector childcare is proportionately less likely to happen.”
A collaborative paradigm, with businesses, schools, governments, and nonprofits working together to expand in-home and stand-alone child care, offers a scalable model for easing some shortages. These successes could also lay a foundation for expanding on such efforts going forward and renew dialogue about how to fund and support child care as critical infrastructure.
This article appeared in the Daily Yonder. See the original article at https://dailyyonder.com/with-pandemic-funding-expired-child-care-providers-seek-solutions-to-shortages-and-sticker-shock/2023/12/26/
From The Progressive Populist, February 1, 2024
Blog | Current Issue | Back Issues | Essays | Links
About the Progressive Populist | How to Subscribe | How to Contact Us