Having a child is a blessing, but raising a child takes a whole lot of work. When parents are looking at preschool care, there are only so many options: Have a parent stop working so they can raise the children at home, ask close friends or family to help (a huge ask), hire a nanny, or send the children to daycare.
All of these options have tremendous emotional and financial costs. The economic burden is especially high for parents who choose to send their children to daycare facilities.
“We are struggling.”
Patricia Bauer is married with two children under five. “We are struggling,” the San Diego mother told NPR in fall 2016.
Virtually all of Bauer’s monthly income goes to pay for her two children’s child care costs. She would leave the job to care for her two tots, but she can’t afford to lose her employer-provided health insurance.
“We feel like we’re working so hard, but any minute we could lose everything—you know, if we had some major emergency, we don’t have savings,” she says.
Bauer’s story, unfortunately, isn’t unique, and the numbers prove it.
Costs are Crazy High
Child Care Aware (CCA) is an organization whose mission is to “advance a child care system that effectively serves all children and families.”
In their 2016 annual report, the organization “exposed child care as one of the most significant expenses in a family budget, often exceeding the cost of housing, college tuition, transportation, or food.”
CCA highlights a department of Health and Human Services (HHS) standard that states that “any child care that costs more than seven percent of a family’s income is unaffordable.”
Unfortunately, CCA notes, “Across all states, the average cost of center-based infant care exceeds 24 percent of the median income for single parents.”
The numbers don’t look better for married couples.
“In 39 states and the District of Columbia,” the report explains, “the average cost of center-based care for an infant exceeds 10 percent of state median income for a married couple with children.
“In only one state were the costs of center based infant care less than seven percent median income for a married couple – Louisiana.”
An Extra Burden for Child Care Professionals
Despite the high costs to parents, it’s not like child care professionals are raking in the dough. Preschool facilities need to hire large staffs because small children need more one-on-one time which dilutes the amount of money available to pay personnel.
So, for those working in daycares and preschool facilities, the cost of placing their own children in child care may be higher than their take-home income.
CCA’s social media toolkit associated with its annual report points out that the “Average hourly wage for child care workers in the U.S. was $10.72 in 2015 – below 97 percent of all occupations.”
Because of this low wage, the toolkit elaborates, “Child care providers are spending 50 percent of their income on care for their own children.”
How Your State Stacks Up
If you’re curious about child care costs in your community, CCA recommends visiting the Economic Policy Institute’s (EPI) Family Budget Calculator. This tool “measures the income a family needs in order to attain a modest yet adequate standard of living.”
The calculator lets you adjust the number of adults and children in the family and choose from 618 locations. These options provide surprisingly specific regional snapshots of how much families need to earn to lead just an “adequate” lifestyle.
If you want to visualize broader strokes and see how your state compares to others across the nation, the EPI offers a graphic map (scroll to the bottom of the page) that allows you to toggle variables like infant care costs and even compare those costs to various wages.
The EPI’s interactive map includes an interesting solution: “Increase in economy from capping child care expenses.”
This nonpartisan think tank concludes that “Meaningful child care reform that capped families’ child care expenses at 10% of their income would expand” the economy, creating millions of dollars in new economic activity for each state that enacted such caps.
If you’ve been thinking that child care is really pricey, two respected national non-profits agree with you. Dig into their research and reports if you want to learn more about what they propose we do about these challenging costs.