A Successful Economy Depends on Affordable Childcare
In the last six months, the COVID-19 public health crisis has changed how we conduct business in nearly every industry. Overnight, employers had to shift operations to keep employees safe and healthy. The onset of COVID-19 has spurred 79 percent of employers to move a significant part of the workforce to remote work. But with these changes, many working parents must face the reality of balancing full-time childcare and full-time employment.
“O ne of the most important things in a community, pandemic or not, is providing a safe and nurturing space for children, and frontline childcare providers deserve a lot of recognition,” said Kyle Cronk, President of the South Sound YMCA. “We were lucky here that as soon as schools shut down in March, we were able to pivot and help essential workers, healthcare workers and emergency responders who needed childcare. Our childcare frontline workers are incredibly valuable, and it’s not possible to have a successful economy without accessible and affordable childcare.”
Access to childcare was already a challenge before the pandemic, as highquality childcare often has significant by Doria Maselli recruitment and retention costs for employers. As childcare programs have closed or are operating at limited capacity, the impact of this lack of childcare options on employers is even more significant. In the fall of 2019, the U.S. Chamber of Commerce Foundation conducted a series of surveys, which led to the creation of four reports, referred to as Untapped Potential, to better understand how childcare challenges affect parents’ participation in the workforce, affect employers’ ability to recruit and retain skilled workers and impact state economies.
This study found that childcare challenges, such as breakdowns in care, affordability or lack of access, contribute to parents postponing school and training programs, forgoing promotions because of schedule changes and sometimes leaving the workforce altogether. In the four states studied, these childcare issues resulted from $479 million to $3.47 billion in estimated
“It is not possible to have a successful economy without accessible and affordable childcare.”
– Kyle Cronk, President, South Sound YMCA annual losses for their economies, with specific direct and indirect impact on employers in those states.
“At the YMCA, we went from providing childcare to 1,000 families pre-COVID-19 to just a little over 200 families during March through June, a volume not even a third of what it was previously,” said Cronk.
“During the summer, our childcare summer camp programs typically serve about 600 families, and we’ve gone down to 250 families this summer.”
These losses were significant to families, employers and states, even when economies were healthy and there was low unemployment. Several months after this study, working parents are facing new, complicated childcare challenges amid COVID-19. Parents are trying to balance their dual roles with limited to no access to formal childcare or family, friends or neighbors to help, making childcare an essential need for every employer and state to prioritize their return to work plans.
Profit margins for childcare are thin. While their services are in high demand, many childcare businesses are unable to weather a sharp drop in revenue. The National Association for the Education of Young Children surveyed childcare providers throughout the country during the middle of March. Across providers in five of the six states that lie wholly or partly in the Ninth Federal Reserve District—Minnesota, Montana, North Dakota, South Dakota and Wisconsin, over half of respondents, mostly homebased family childcare providers, said they would not survive closing for more than two weeks without public investment and supports that allow them to compensate and retain staff, pay rent and cover other fixed costs.
“We’re lucky that we’ve been able to still provide childcare for those who are struggling financially and stay committed to our mission of providing youth and our community affordable and accessible resources and not turn anyone away based on financial circumstances,” says Cronk. “Our childcare revenue has decreased by 80 percent, but we’ve been here for 107 years and will continue to be here, and the best way we can accomplish that is by responding to and serving community needs.”
To determine the best solution, parents must consider various factors in determining the level and type of childcare solutions that best meet their needs. These factors make up what is referred to as the ‘Childcare Equation.’ But the equation is different for each family depending on a variety of circumstances.
Every piece of the equation is vital to making the whole picture work. This equation results from working parents navigating the following factors:
- Their work responsibilities, including their hours, schedule & employer flexibility
- Their home environment, including who in the home might be available to care for young children and their physical proximity to a childcare program
- The options in their community, including availability of childcare, potential conflicting schedules with older children attending school
- Their family composition, including the work schedule of a partner, spouse or extended family member to share caregiving responsibilities
In the Chamber Foundation’s June 2020 Parent Survey, at least 33 percent of working parents identified that they used multiple providers.
On average – parents with a child who stayed at home with a parent or guardian pre-COVID indicated that they used this coverage 81 percent of the time or roughly 4 out of 5 days a week. Even as the most frequently used solution, the typical working parent in America uses a combination of providers to meet their childcare needs. This combination of care options complicates the Childcare Equation for families and adds another piece to the puzzle that, if changed, results in adjusting the entire equation.
The Childcare Equation was already hard to get right during a strong economy. The demand for childcare outpaces
the supply in most states. Since the outbreak of COVID-19, it has become nearly impossible, as childcare options have been dramatically limited across the United States. So, how can communities join forces and pool together resources to help?
“One takeaway from this pandemic is that it’s forcing us to look at childcare issues and disparities. Since 2008, the banking, airline and auto industries have received 850 billion dollars in federal aid. Childcare providers have received none,” says Cronk. “We need solutions to the Childcare Equation and community conversations to address these needs
long-term. I’m so thankful to all of our community partner organizations and school district partners in the South Sound who have stepped up and worked with us during this time to get a head start on solving this complicated equation.”