What It Will Take to Make U.S. Child Care More Affordable

Executive Summary

Across the United States, parents struggle to find a care provider they feel comfortable with and can afford; often child care costs more than college, but new parents haven’t had the time to save up for it. Breakdowns in child care (nannies who suddenly disappear or daycares that fail quality inspections, for example) cost our economy an estimated $4.4 billion due to lost productivity. Child care expenses are cited as the number one reason why young adults are having fewer children than they would like. Faced with few viable options, it’s mostly women who end up considering an exit from the workforce rather than compromising on quality, particularly when their salaries are not covering daycare tuition. Companies, individuals (by joining forces), and the U.S. government can do something about this pressing challenge.

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As soon as I got pregnant, friends told me, “Get yourself on a daycare waiting list!” and related their own horror stories of their scrambles to find care. So, during my pregnancy, my husband and I toured multiple daycare centers in Washington, D.C., where we live. At one, we walked right in because there was no security; the carpets were dirty, and the toddlers sat listening to a recording while a child care provider sat in a corner staring at us. Another looked sunny, safe, and clean, but the price tag was more than our monthly mortgage payment, and we faced a waitlist though my child wasn’t due for months.

Across the United States, parents struggle to find a care provider they feel comfortable with and can afford; often child care costs more than college, but new parents haven’t had the time to save up for it. Breakdowns in child care (nannies who suddenly disappear or daycares that fail quality inspections, for example) cost our economy an estimated $4.4 billion due to lost productivity. Child care expenses are cited as the number one reason why young adults are having fewer children than they would like. Faced with few viable options, it’s mostly women who end up considering an exit from the workforce rather than compromising on quality, particularly when their salaries are not covering daycare tuition.

Companies, individuals (by joining forces), and the U.S. government can do something about this pressing challenge.

What Businesses Can Do

My family is lucky: I now work for an employer that subsidizes tuition for a daycare center across the street, where my daughter is thriving. I can run over to check on her at any moment. This is a rare employee benefit. It was also a key factor in my decision to take this job.

Larger companies should follow suit and should look into offering robust child-care benefits, which can have a positive impact on their bottom line and can significantly impact the retention of women. Some offer on-site or nearby daycares, which do carry a significant price tag and require regulatory compliance and liability insurance; but considering the lavish benefits that many major corporations bestow upon their employees, including wellness centers, corporate retreats, and office decor budgets, this may be less an issue of budget and more of prioritization. Patagonia estimates that it recoups 91% of its costs on its on-site center. Spurred by an employee who had struggled to find  daycare for her children, Home Depot also boasts an on-site center at its headquarters.

For smaller or medium-size businesses, other options for supporting caregiving employees include paid family leave, child care subsidies, backup caregiving networks or helping to coordinate summer care programs, and flexible-spending-account benefits that employees can use pre-tax toward the cost of child care.

What Individuals Can Do

Quick caveat: Parents, I know you are tired, overworked, and stressed out. I believe that the current system is failing you, and I do not think this should be your burden to bear or problem to solve.

Having said that, systemic change is not likely to happen overnight. In the meantime, individuals can effectively advocate for smaller but meaningful changes, within their employers and in their broader community.

Employees can form caregiver networks to openly discuss the challenges of managing life and work, and collaborate with Human Resources and management to create solutions. One Best Buy employee who had to bring her infant child into work due to a gap in care catalyzed a new company-wide backup care benefit. Individuals can also use their collective voices to advocate for better paid family leave policies, which can help offset child care costs in the short term.

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Working Parents

Individuals can also make a difference by being open about the struggles of parenting. Amanda Lenhart at New America Foundation told me, “We talk a lot about the ideal worker norm, this idea of ‘Hey, I’m just here to work; there’s nothing taking me away from 100% complete devotion to the bottom line of my employer.’ That’s not true for the majority of Americans. Even if you’re not in the thick of raising young children, there are so many ways in which Americans are caring for other people.” If more of us are honest about our challenges, it normalizes caregiving and having a life outside of work.

Managers and organizational leaders have a particular opportunity to set an example for their teams — for example, by taking their full parental leave or being transparent when they have to prioritize a family member’s doctor appointment. And they should support their employees when they do the same.

Finally, we can all vote.

What Government Must Do

Is there a business model for a high-quality, robust child-care system without significant government support? “That’s not possible,” Lynette Fraga of Child Care Aware of America, told me. “Public investment is necessary at all levels to ensure that high-quality care is accessible to all families so children can grow up in high-quality, nurturing, safe settings.” While some may argue that over-regulation causes the high cost of child care, it is also clear that quality matters, not only to children and their parents but also to our overall economy. Cutting back on quality to save costs is not the solution.

If we leave this issue to the private sector to resolve, the best benefits will continue to be distributed to the most privileged workers, increasing systemic inequities. No matter what proactive action businesses take and how engaged American parents get on this issue, we won’t see systemic change without government leadership.

Other countries invest in families by sponsoring or subsidizing early child care. In Quebec, families can expect full-time, year-round, affordable child care at all income levels. It has 20 years of data to show that the program works for the economy, keeping more women in the workforce, and ultimately paying for itself. Denmark, France, Sweden, Norway, and many other developed countries have implemented programs to help families shoulder this burden. While none of these systems is perfect, they offer important lessons and potential blueprints for what we could do in the United States.

Universal child care is getting new energy and momentum in the U.S. for the first time in about 50 years, as candidates seek to differentiate themselves ahead of the 2020 presidential election. Senator Elizabeth Warren of Massachusetts has proposed a universal child care program that would create a network of publicly-funded care centers. Families with incomes less than 200% of the federal poverty line would receive care for free. While the price tag may seem steep — $70 billion per year — the program could cover as many as 12 million children, and it would make a huge difference in the lives of those families, and strengthen the country’s human capital for decades. And recently, Senator Patty Murray of Washington re-introduced the Child Care for Working Families Act, which would cap the cost of child care at 7% of household income, increase pre-kindergarten funding, and invest in improvement of child-care-provider training.

I’m encouraged that there are more women, including more new mothers, in Congress than ever before, some of whom have their own child care challenges. This new class of leaders is uniquely positioned to alleviate issues that are placing their fellow parents across the country in financial jeopardy. I hope to see them collectively raise their voices and invest in our country’s future by expanding access to affordable, high-quality child care.

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