Exacerbated by pandemic, child care crisis hampers economy

Oct 27, 2021, 7:28 AM | Updated: Oct 28, 2021, 9:28 pm
Amy McCoy serves lunch to preschoolers at her Forever Young Daycare facility, Monday, Oct. 25, 2021...

Amy McCoy serves lunch to preschoolers at her Forever Young Daycare facility, Monday, Oct. 25, 2021, in Mountlake Terrace, Wash. Child care centers once operated under the promise that it would always be there when parents have to work. Now, each teacher resignation, coronavirus exposure, and day care center closure reveals an industry on the brink, with wide-reaching implications for an entire economy's workforce. (AP Photo/Elaine Thompson)

(AP Photo/Elaine Thompson)

SEATTLE (AP) — After Bryan Kang’s son was born in July, the occupational therapist and his wife, a teacher, started looking for child care in the Los Angeles area. The couple called eight day care centers: Some didn’t have spots for months; others stopped taking their calls and some never answered at all.

So with no viable options, Kang scrambled to find a new job that would allow him to work remotely.

“I told my manager, ‘Hey, by the end of the month, I have to transition out,'” Kang said. “They were very supportive and very understanding because they’re all mothers. But now there’s one less body to see patients.”

Kang said he’s fortunate he found a job teaching online classes, but the unexpected career pivot forced him to take an 11% pay cut.

The truth is, even if he could find a day care spot for his now 3-month-old son, the $2,500 monthly cost of infant care is so high that taking a lower-paying job so he can work from home and care for the baby is the most financially sensible thing to do.

The child care business has for years operated in a broken, paradoxical market: low wages for workers and high costs for consumers. Yet the critical service somehow managed to limp along.

Now, the pandemic has made clear what many experts had long warned: The absence of reliable and affordable child care limits which jobs people can accept, makes it harder to climb the corporate ladder and ultimately restricts the ability of the broader economy to grow.

“Early learning is no longer seen as just a women’s issue or a children’s issue. It’s really seen as an economic issue. It’s about workforce participation,” said Mario Cardona, policy chief for Child Care Aware of America. “It’s about employers who don’t have to worry about whether they’ll be able to rely upon employees.”

Child Care Aware estimates 9% of licensed child care programs have permanently closed since the pandemic began, based on its tally of nearly 16,000 shuttered centers and in-home day cares in 37 states between December 2019 and March 2021.

Now, each teacher resignation, coronavirus exposure and day care closure reveals an industry on the brink, with wide-reaching implications for an entire economy’s workforce.

The national crisis has forced many people — mostly women — to leave their jobs, reshaping the child care crisis as not just a problem for parents of young children, but also anyone who depends on them. It has contributed to a labor shortage, which in turn has hurt businesses and made it more difficult for customers to access goods and services.

“The decisions we make about the availability of child care today will shape the U.S. macroeconomy for decades to come by influencing who returns to work, what types of jobs parents take and the career path they are able to follow,” said Betsey Stevenson, an economist at the University of Michigan.

President Joe Biden has pledged an unprecedented burst of federal spending in hopes of fixing the child care market. At a recent town hall in Baltimore, he assured parents they would “not have to pay more than 7% of your income for child care.” Federal money would go directly to care centers to cover costs in excess of the 7% cap. This means the median U.S. family earning $86,372 would pay $6,046 annually for child care.

Biden’s plan also includes universal pre-kindergarten, which could further reduce child care expenses for families. The expanded monthly payments from the child tax credit approved in Biden’s $1.9 trillion coronavirus relief package would be extended for another year. The president also proposed increasing the size of a tax credit for the cost of child care, all of which should help improve access for families.

The Congressional Budget Office has yet to score the costs as the measures are still being negotiated ahead of Biden’s departure Thursday for the G-20 conference in Rome. But Donald Schneider, a former chief economist for the House Ways and Means Committee who now works for the consultancy Cornerstone Macro, estimates the child care and pre-kindergarten support would cost $465 billion over 10 years. The one-year price-tag of the expanded child tax credit would be around $120 billion. The credit would cost an additional $940 billion if renewed for nine more years.

It remains to be seen what survives in the brutal negotiations in Congress for Biden’s broad family services agenda, but the pandemic is proving to be a make-or-break catalyst for the future of the child care industry.

At Forever Young Daycare in the Seattle suburb of Mountlake Terrace, Amy McCoy is burning out fast.

She’s spent half of this year trying to hire a new assistant for her in-home child care, but until then, the former public school teacher works 50 hours a week caring for children herself, and more doing the cooking, cleaning and administrative work needed to run her business.

“At what point is my day care more important than my own family?” McCoy asked.

One of McCoy’s assistants, who worked there for five years, quit the $19-an-hour job in April for a $35-an-hour job nannying. McCoy has posted the opening for an entry-level assistant on Indeed and Facebook, offering $16 per hour — nearly 20% more than the state minimum wage. She’s gotten few responses and all turned her down over pay, making hiring impossible without a tuition increase.

“Nobody wants to work for what I can afford to pay right now,” McCoy said. “I absolutely believe these are $20-an-hour employees, but I hate that, most likely, I will have to raise tuition.”

The U.S. Treasury Department noted in a September report that child care workers earn on average $24,230. More than 15% of the industry’s workers live below the poverty line in 41 states and half need public assistance. The sector has high levels of turnover, with 26% to 40% leaving their job each year. Nor is there much room to give among child care centers that tend to operate on profits of 1% or less.

In nearby Edmonds, Briana McFadden shuttered her business, Cocoon Child Care Center, last month due to the stress of the pandemic, though McFadden thinks she would have stayed open if there were government subsidies to stabilize the industry.

In 12 years in business, McFadden said she never raised tuition and was the rare day care in the affluent northern Seattle suburbs to accept low-income families on a state subsidy. In pre-pandemic times, Cocoon employed seven people to care for 37 children. Now McFadden plans to open a convenience store.

“It really wasn’t worth it to continue,” McFadden said, her voice quivering with emotion. “Day care is a hard business.”

Tatum Russell’s livelihood depended as much on McFadden’s day care as the restaurant that employs her to hand-bread seafood.

During a COVID-19-related day care closure in August, the single mom could only stitch together help from relatives for some of the time. Russell ultimately had to miss four days of work.

“It’s been a nightmare, and it’s not over,” Russell said.

___

Boak reported from Washington, D.C.

Copyright © The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.


              Amy McCoy signs to a baby about food as a toddler finishes lunch behind at her Forever Young Daycare facility, Monday, Oct. 25, 2021, in Mountlake Terrace, Wash. Child care centers once operated under the promise that it would always be there when parents have to work. Now, each teacher resignation, coronavirus exposure, and day care center closure reveals an industry on the brink, with wide-reaching implications for an entire economy's workforce. (AP Photo/Elaine Thompson)
            
              Amy McCoy reads a book to preschoolers as they finish their lunch at her Forever Young Daycare facility, Monday, Oct. 25, 2021, in Mountlake Terrace, Wash. Child care centers once operated under the promise that it would always be there when parents have to work. Now, each teacher resignation, coronavirus exposure, and day care center closure reveals an industry on the brink, with wide-reaching implications for an entire economy's workforce. (AP Photo/Elaine Thompson)
            
              Preschool children eat lunch at a day care facility, Monday, Oct. 25, 2021, in Mountlake Terrace, Wash. Child care centers once operated under the promise that it would always be there when parents have to work. Now, each teacher resignation, coronavirus exposure, and day care center closure reveals an industry on the brink, with wide-reaching implications for an entire economy's workforce. (AP Photo/Elaine Thompson)
            
              Amy McCoy cuddles a seven-month old baby at her Forever Young Daycare facility, Monday, Oct. 25, 2021, in Mountlake Terrace, Wash. Child care centers once operated under the promise that it would always be there when parents have to work. Now, each teacher resignation, coronavirus exposure, and day care center closure reveals an industry on the brink, with wide-reaching implications for an entire economy's workforce. (AP Photo/Elaine Thompson)
            
              A preschooler gets up on her toes to reach into her assigned cubby at a preschool center Monday, Oct. 25, 2021, in Mountlake Terrace, Wash. Child care centers once operated under the promise that it would always be there when parents have to work. Now, each teacher resignation, coronavirus exposure, and day care center closure reveals an industry on the brink, with wide-reaching implications for an entire economy's workforce. (AP Photo/Elaine Thompson)
            
              Teacher's assistant Brooklynn Bailey, right, walks away after tucking a child in for a nap behind at Forever Young Daycare facility, Monday, Oct. 25, 2021, in Mountlake Terrace, Wash. Child care centers once operated under the promise that it would always be there when parents have to work. Now, each teacher resignation, coronavirus exposure, and day care center closure reveals an industry on the brink, with wide-reaching implications for an entire economy's workforce. (AP Photo/Elaine Thompson)
            
              Preschoolers eat lunch at a day care center, Monday, Oct. 25, 2021, in Mountlake Terrace, Wash. Child care centers once operated under the promise that it would always be there when parents have to work. Now, each teacher resignation, coronavirus exposure, and day care center closure reveals an industry on the brink, with wide-reaching implications for an entire economy's workforce. (AP Photo/Elaine Thompson)
            
              Amy McCoy serves lunch to preschoolers at her Forever Young Daycare facility, Monday, Oct. 25, 2021, in Mountlake Terrace, Wash. Child care centers once operated under the promise that it would always be there when parents have to work. Now, each teacher resignation, coronavirus exposure, and day care center closure reveals an industry on the brink, with wide-reaching implications for an entire economy's workforce. (AP Photo/Elaine Thompson)

AP

A person walks in front of an electronic stock board showing Japan's Nikkei 225 index at a securiti...
Associated Press

Asian shares mixed after Wall St falls on rate hike worries

BANGKOK (AP) — Shares were mixed Thursday in Asia after Wall Street gave back some of its recent gains on persisting uncertainty over interest rates and inflation. Benchmarks declined in Tokyo, Seoul and Sydney but rose in Hong Kong and Shanghai. U.S. futures were higher while oil prices edged up. Wall Street retreated Wednesday following […]
24 hours ago
FILE - The company logo highlights the grille of a 2021 Tacoma pickup truck on display in the Toyot...
Associated Press

Toyota reports 8% drop in Oct-Dec profit, keeps forecast

TOKYO (AP) — Toyota reported an 8.1% drop in fiscal third quarter profit Thursday, as a global shortage of computer chips and soaring raw material costs battering the auto industry hit Japan’s top automaker. Toyota Motor Corp.’s October-December profit totaled 727.9 billion yen ($5.6 billion), down from 791.7 billion yen the previous year. The company […]
24 hours ago
FILE - Pennsylvania Lt. Gov. John Fetterman takes the stage at an election night party in Pittsburg...
Associated Press

Sen. John Fetterman hospitalized after feeling lightheaded

WASHINGTON (AP) — U.S. Sen. John Fetterman, the Pennsylvania Democrat who suffered a stroke during his campaign last year, was hospitalized Wednesday night after feeling lightheaded while attending a Senate Democratic retreat, his office said. Initial tests at George Washington University Hospital did not show evidence of a new stroke, Fetterman’s communications director, Joe Calvello, […]
24 hours ago
This photo taken with a drone shows portions of a Norfolk Southern freight train that derailed Frid...
Associated Press

Fiery Ohio derailment raises railroad safety questions

OMAHA, Neb. (AP) — The fiery derailment of a train carrying toxic chemicals when it went off the tracks — sending a huge plume of smoke in the air and forcing residents of a small Ohio town to evacuate — has highlighted the potentially disastrous consequences of train accidents and raised questions about railroad safety. […]
24 hours ago
FILE - President Joe Biden delivers the State of the Union address to a joint session of Congress a...
Associated Press

Biden’s oil comments spark debate over energy production

WASHINGTON (AP) — President Joe Biden sparked a firestorm in energy circles when he said in Tuesday’s State of the Union address that the United States will need oil “for at least another decade.´´ Republicans in the House chamber laughed in derision at Biden’s off-the-cuff remark, which was not in his scripted speech. GOP lawmakers […]
24 hours ago
Kailani Taylor-Cribb walks through her neighborhood in Asheville, N.C., on Tuesday, Jan. 31, 2023. ...
Associated Press

The pandemic missing: The kids who didn’t go back to school

She’d be a senior right now, preparing for graduation in a few months, probably leading her school’s modern dance troupe and taking art classes. Instead, Kailani Taylor-Cribb hasn’t taken a single class in what used to be her high school since the height of the coronavirus pandemic. She vanished from Cambridge, Massachusetts’ public school roll […]
24 hours ago

Sponsored Articles

...
Quantum Fiber

Stream 4K and more with powerful, high-speed fiber internet

Picking which streaming services to subscribe to are difficult choices, and there is no room for internet that cannot handle increased demands.
...
Quantum Fiber

How high-speed fiber internet can improve everyday life

Quantum Fiber supplies unlimited data with speeds up to 940 mbps, enough to share 4K videos with coworkers 20 times faster than a cable.
...
Children’s Cancer Network

Children’s Cancer Network celebrates cancer-fighting superheroes, raises funds during September’s Childhood Cancer Awareness Month

Jace Hyduchak was like most other kids in his kindergarten class: He loved to play basketball, dress up like his favorite superheroes and jump as high as his pint-sized body would take him on his backyard trampoline.
Exacerbated by pandemic, child care crisis hampers economy