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Arizona child care costs skyrocket during COVID-19 pandemic

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PHOENIX — Arizona parents finding themselves paying more for child care are not alone.

“Unfortunately, child care costs in Arizona have really skyrocketed during the pandemic,” said Matt Schulz, chief credit analyst with LendingTree, a loan marketplace.

Data analyzed by LendingTree shows child care costs have gone up 84% in Arizona since the pandemic began in March. It’s the seventh-largest increase in the country.

“Arizona definitely saw one of the biggest increases,” Schulz said. “Any time any cost goes up 84% in the course of a year, it’s a really troubling thing. But during these strained difficult economic times, it’s just even worse.”

According to LendingTree’s analysis, the average annual cost of child care in Arizona before the pandemic began was $8,213. That jumped to $15,077 during the pandemic.

The increase is due in part to child care providers having to spend money to meet COVID-19 safety guidelines.

“Any time a business’ own costs go up, they’re probably going to raise the price on their customers, and that’s what we’re seeing now,” Schulz said.

Another reason for the increase in child care costs has to do with providers having to take on fewer children to allow for social distancing, which means less revenue.

“In places where they may have had 15 to 20 kids, they may only be able to have five to eight now,” Schulz said. “And when you have that much revenue decrease, sometimes you end up having to ramp up what people pay to make up the difference.”

LendingTree came up with its findings by analyzing data from the Centers for American Progress and Child Care Aware of America.

Another recent report by the Bipartisan Policy Center found about 25% of children in Arizona who needed child care didn’t have a place to go. According to the report, the state has 304,180 kids who need child care but only 234,270 slots to accommodate them.

Liz Barker Alvarez, chief policy advisor for First Things First, wasn’t surprised by the findings. She noted there has been shortage for child care options across the state for years, and the coronavirus pandemic has made it worse.

“In the early days of the pandemic, as many as 50% percent — almost two-thirds — of child care providers were closed,” Barker Alvarez said.

Some have reopened but had to cut back on how many children they serve due to COVID-19 safety guidelines.

Alvarez added that making sure there are adequate child care options for working parents will be crucial for post-pandemic economic recovery.

“Numerous studies have shown that the availability of child care impacts whether people even participate in the workforce,” she said. “I mean, are they even looking for a job, can they hold down a job, are they productive in their job?”

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