With pandemic money gone, child care an industry on the brink

costs have increased along with inflation — for food, sup- plies and liability and prop- erty insurance. Rising wages at food service and retail jobs have made it harder to recruit child care workers, one of the lowest-paying jobs in the country.

And families’ use of child care has changed, making it difficult for providers to maintain the requisite number of workers and collect a stable income. Some par- ents now use care less consis- tently because they work from home more often or found alternative arrangements, like having family members or nannies care for children, during the pandemic.

The result is an industry on the brink, new data shows.

In a survey released Feb. 25 by the National Association for the Education of Young Children, more than half of 3,815 child care own- ers or directors said they were enrolling fewer chil- dren than they were licensed for. Mostly it was because of staffing shortages — they said they could not afford to pay workers more because par- ents could not afford to pay more.

Half the providers said they had increased tuition. Of a broader group of more than 10,000 child care work- ers surveyed, 55% said they knew of at least one program in their community that had shut down since the expira- tion of federal funds.

Many parents are feel- ing the stress of rising costs and shrinking availability. On average, a recent survey by Care.com found, they spend one-quarter of their income on child care (the Depart- ment of Health and Human Services says for child care to be affordable, it should cost no more than 7% of a family’s income). A majority said tui- tion had increased and wait lists had grown since the fund- ing’s expiration.

Some have tapped their savings or taken more jobs to pay for care. Others have asked family or friends to care for their children, or cut back their work hours to do so.

“As these funds disappear, it’s just pushing programs that were just barely staying together over the edge of unsustainability,” said Eliza- beth Ananat, an economist at Barnard College.

The Biden administration has asked Congress for $16 billion for one year of addi- tional funding for child care, and a group of Democratic senators has supported it, though it is unlikely that it would get the Republican approval needed to pass.

In the meantime, some states, including a few led by Republicans, have invested state funds to make up for the loss of federal funds. For example, Vermont will spend $125 million a year for large expansions in eligibility for subsidies for low-income fam- ilies, and Kentucky spent $50 million on grants after fed- eral funds expired.

That is not enough, said Sondra Goldschein, executive director of the political action committee for the Campaign for a Family Friendly Econ- omy, which is spending $40 million to back President Joe

Biden and Democratic candidates who support child care. “We want child care to be thought of as permanent infrastructure and have sustained substantial investment in the sector at the federal level,” she said.

Subsidizing child care for most providers, as the government did during the pandemic, or for most families, as the Biden administration was unable to do in its social spending bill, is politically unlikely. Republicans did not support the bill’s family policies, including broadly subsidized child care and universal pre-K.

But there has been support from both parties for other ideas. One is increasing financing for the block grant that helps low-income families pay for child care.