Enrollment at Good Shepherd Christian Academy, a child care center in Fort Worth, Texas, plummeted almost as soon as the pandemic hit, from 84 kids to just 10.
It’s been one thing after another since, said Ontara Nickerson, the center’s director. The paltry number of children meant shortened workdays: Many of the center’s hourly workers couldn’t make do with reduced pay and quit in search of better wages.
Yet Nickerson and her team have managed to stick it out, largely thanks to federal relief dollars that started flowing into child care centers last year. Good Shepherd Christian Academy was one of more than 200,000 providers nationwide that received aid through the American Rescue Plan, according to data shared exclusively with USA TODAY by the White House, money that helped the vast majority of recipients avoid closures despite unrelenting economic and public health pressures.
“The stabilization grants came right at the moment when our program was unsure of how much longer we’d be able to keep our doors open,” Nickerson said. It “allowed us to withstand the worst of the pandemic.”
The ARP, signed into law last March by President Joe Biden, included $24 billion for a Child Care Stabilization Program. It provided emergency relief, distributed by states, to child care providers that could then be used for basic costs to keep centers running, like wages, rent and materials. Never before had a federal economic rescue package made child care reform – seen as key to getting parents back to work – a central tenet of its recovery plan.
The money ultimately reached as many as 9.5 million children and 1 million child care workers. Close to half of the providers who received assistance are owned and run by people of color, the data show, and more than half are located in the country’s most racially diverse communities.
But that cash was a temporary fix. Efforts by the Biden administration to continue such support failed, and expanded child tax credits – which provided monthly payments that one in four families used for care – expired. The federal child care grant program in place since before the pandemic covers only one in seven eligible children.
“As I look toward the horizon, I am concerned and worried that once these funds diminish, how am I going to retain the financial stability?” Nickerson said. The cost of basic goods continues to spiral, making it even more difficult to retain and recruit qualified staff even though enrollment is back to 65 students and the infant class has a waiting list.
“I’m afraid that without recurring financial (assistance), the child care industry is going to have to … wrestle with trying to chase a paycheck rather than chasing our passion” of working with kids and supporting families, she said.
So what does the child care landscape look like now? Many child care providers still struggle to stay open and retain staff, and many parents still struggle to find care.
How many child care centers shut down?
The White House estimates the stabilization funds helped eight out of every 10 licensed centers, covering every state and territory and, in most states, virtually all counties with persistent poverty.
One study from the left-leaning Century Foundation, published in March, found that federal aid by then already had helped nearly 75,000 providers avoid permanent closures, salvaging more than 3 million child care spots.
Some states have even reported an increase in the number of licensed child care slots compared with just before the pandemic. Maine went from having child care for 47,819 young children in February 2020 to 48,940 slots in June 2022, for example.
But the number of child care providers was already declining before the pandemic – and some 16,000 permanently closed between December 2019 and March 2021, according to Child Care Aware of America, a research and advocacy organization.
Thousands more are likely on the brink of going under as the federal help evaporates.
“Those dollars were really important, and the absence of them will be felt,” said Mia Pritts, the vice president of strategic partnerships at Wonderschool, a company that works to increase child care access by helping connect providers with parents.
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How much does child care cost these days?
The federal government spends billions on Early Head Start and Head Start, early-childhood education and development programs that are free for eligible low-income families.
For other families, rarely is early-childhood education free.
As of last year, increases in the cost of child care continued to outpace inflation, according to Child Care Aware. The average price of child care in 2021 was roughly $10,600 nationally.
That means parents are spending a significant chunk of their incomes on care. In fact, in 34 states, the yearly cost of putting an infant in center care is more expensive than in-state tuition at a public university. For families with two children, in most states, the price of care exceeds annual housing payments.
After factoring in public child care subsidies, Charles Gascon, a senior economist at the St. Louis Fed, found that child care takes up about 10% of parents’ income in two-income households. In single-income households, care accounts for a whopping 32% of take-home pay. Gascon analyzed the true cost of child care in each state, finding it’s least affordable in Vermont and Maine, with Utah and Georgia on the other end of the spectrum.
Ongoing debates over abortion rights have further underscored how expensive it is to have and raise a child in America.
Why is it so hard to find good child care?
Addressing the child care crisis “is not a one-and-done thing,” said Pritts of Wonderschool, which is working with 43 states in different capacities. “It’s a very complex, long-standing problem.”
The child care industry pays very little: The average worker makes less than $26,000 a year, according to the Bureau of Labor Statistics. Federal data show there are 100,000 fewer child care workers in the U.S. than there were pre-pandemic.
States including Michigan used the funds to provide bonuses to tens of thousands of child care professionals. But the ARP didn’t provide a permanent solution to the wage issue. The industry, as a result, is competing with all kinds of other employers.
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Many child care workers are being lured to jobs that may not be as gratifying, but do, unlike many early learning centers, provide benefits.
Another reason for the mismatch between supply and demand, according to Pritts: limited, inconsistent data, paired with providers who are too under-resourced to effectively market themselves.
Sumaiya Jahan has been running daycares out of her homes for more than decade, including for the last nine or so in a Northern Virginia townhouse that she shares with her husband and two children. Jahan provides meals and employs two assistants, charging families on a sliding scale based on their income. Some of her students receive child care subsidies.
Jahan loves children; she loves that running a home-based daycare allows for the mixing of different ages, for babies to learn from toddlers and vice versa.
But rarely has it been easy, and at times she’s wondered how much longer she can stay afloat. While Jahan received and used the ARP funds to help offset lost income due to shrunken enrollment and is now at full capacity, new leads rarely come in and costs continue to mount.
Jahan recently linked up with Wonderschool, and already the platform has streamlined her paperwork and helped her with marketing. Now, she can spend more time on the educational parts of her job: She just adopted a new curriculum with a focus on subjects ranging from science to art that she’s now using with her students, ages 1 through 4.
Yet she still lives paycheck-to-paycheck. “Who isn’t these days?” she said.
The number of licensed home-based child care centers like Jahan’s, which tend to be more affordable than other types of care, has steadily decreased in recent years. In the 40 states for which data are available, Child Care Aware of America found a 10% drop in such homes between 2019 and 2021.
What’s being done to fix the child care system?
The ARP “was unique in the degree to which it recognized the need to stabilize the child care industry, and preserve child care capacity as crucial to recovery,” Gene Sperling, a senior advisor to Biden who helped coordinate the law, told USA TODAY.
The goal of the ARP child care stabilization funds was precisely that, Sperling said – to stabilize the industry. To get parents back into the labor market.
Some states are trying to pick up where that relief money left off.
New Mexico has been working on pay raises for child care professionals, including through a recent grant allowing for $3 an hour increases across the board. A provision on this year’s ballot would also make universal prekindergarten a constitutional right in the state. Nevada, meanwhile, expanded child care subsidies earlier this year.
Labor participation in Connecticut has grown thanks partly to its investments in child care, including wage supplements for providers and the addition of more than 1,000 infant and toddler seats. “I want young families to know that we are the most family-friendly state in the country,” Gov. Ned Lamont told USA TODAY.
Still, even there, workers say they need more.
“The investment in child care I fought for wasn’t just a big deal – it saved the child care industry from collapse,” said Democratic Sen. Patty Murray, a former preschool teacher who’s spearheaded various legislative efforts to expand access to early learning. “It showed what is possible when we make historic federal investments in child care: more stability for child care programs, more child care slots available, more parents back at work, and an economy that works better for everyone.
“But we cannot stop here.”
Contact Alia Wong at (202) 507-2256 or firstname.lastname@example.org. Follow her on Twitter at @aliaemily.