The Covid-19 pandemic has significantly impacted the American economy, shedding light on the cracks and resilience within it. Among the various sectors affected, childcare emerged as a critical aspect as daycares closed, schools shifted to remote learning, and parents struggled to balance work and childcare responsibilities. Despite a return to baseline employment levels in the childcare sector post-pandemic, data from the Bureau of Labor Statistics indicates a shortage of workers and available slots for children in some areas, putting a strain on the industry. Additionally, families are facing increased costs, with a reported 15% to nearly 30% rise in average childcare payments per household year-over-year during the fourth quarter of 2023.
Policy advocates emphasize that childcare is not just a family issue but an economic one that impacts all Americans. Stabilization funds from the American Rescue Plan Act, intended for the childcare sector, expired last fall, potentially leading to heightened costs for families or the closure of childcare centers. A report by ReadyNation in 2023 estimated that the U.S. loses $122 billion annually due to the infant-toddler childcare crisis, up from $57 billion in 2018. The study attributes the exacerbation of the crisis to Covid-19 and insufficient policy actions, emphasizing the need for immediate intervention.
ReadyNation highlights the importance of supporting the “workforce behind the workforce,” referring to early childcare providers. The organization suggests that ensuring benefits for childcare providers, offering access to additional training and education, and adequately reimbursing providers for the cost of care are crucial steps in addressing the crisis. In California, alone, the economic toll of lost earnings, productivity, and revenue is estimated at $17 billion, the highest among all states. Childcare jobs in California have rebounded compared to 2020 levels, but challenges persist, including wage disparities and limited resources.
Childcare workers in California organized under the Child Care Providers United in 2019, representing over 40,000 home-based providers in the state’s subsidy program. The union secured its first contract in 2021, granting providers retirement benefits and advocating for fair reimbursement rates. Many childcare providers in California struggle with low pay, with average hourly wages ranging from $7 to $10. The union is pushing for full reimbursement of care costs to enhance the dignity of the workforce and attract more providers. Provider Deborah Corley-Marzett from Bakersfield, California, emphasized the challenges of hiring staff and competing with higher-paying sectors like fast food.
Lawmakers, such as State Senator Nancy Skinner from California, recognize the progress made in addressing the childcare crisis but acknowledge the need for continued efforts. Senator Skinner, chair of the California Women’s Caucus, advocated for a $2 billion increase in state spending on early care and education over the past two years, totaling $6.5 billion. The focus now is on maintaining steady reimbursement rates for childcare providers amidst economic uncertainties and workforce challenges. Despite low unemployment rates, sectors across the economy are struggling to attract and retain workers, underscoring the importance of sustained support for childcare services.