A headline last year from Forbes.com effectively distills an important issue facing our nation: “Why the child care crisis is actually an economic crisis.”
Reports about a shortage of available, affordable child care have been common in recent years, particularly since the COVID-19 pandemic delivered new challenges for the industry. But Americans remain reluctant to view the issue as an economic one rather than a matter of personal choice.
As Amy Shoenthal wrote for Forbes: “With parents spending upwards of 40 percent of their earnings on child care year-round, it’s no surprise that many are simply leaving the workforce completely, not only fueling the child care crisis, but creating an economic one. The Department of Labor estimates that women … are penalized by $295,000 in missed lifetime earnings due to the fact that they are often forced to leave the workforce or take pay reductions to accommodate caregiving responsibilities.”
That not only impacts the current earnings, future earnings and retirement savings of would-be workers, it also creates difficulties for employers. Since the onset of the pandemic, businesses in multiple industries have reported a labor shortage that has hampered an otherwise strong economic recovery.
All of this comes to mind with a recent report from the state Department of Children, Youth and Families. As media outlet Washington State Standard summarizes: “Even with state subsidies, families in Washington still cannot afford child care and providers are struggling to pay their staff.”
That is not unique to Washington. According to the Annie E. Casey Foundation, a national charitable organization, infant care is more expensive than in-state college tuition in 34 states.
That situation has drawn attention from Washington lawmakers. The state is required to reimburse providers for subsidies that families use to pay for child care, but the recent survey reveals those reimbursements are falling well short of the mandated level. As the report says: “Base rates alone are insufficient to support the cost of care at the highest levels of quality, and far too low to support a living wage for workers.”
That makes it difficult for providers to find and retain qualified employees, creating a cycle that makes it difficult for parents to find adequate care.
At its core, the issue touches on philosophical differences. One regards the role of government in subsidizing particular industries, rather than allowing the free market to dictate supply. That is why child care must be viewed as an economic issue; subsidies allow the rest of the free market to operate efficiently, helping to provide enough workers for other industries. Another philosophical issue involves the role of government in providing early child education, rather than supporting efforts to help parents stay at home with young children.
In 1971, Congress passed the Comprehensive Child Development Bill with bipartisan support. It would have provided universal child care supported by taxpayers — a public investment for the public good — but was vetoed by President Richard Nixon. The issue then spurred a culture war in which opponents of the bill speciously argued that universal child care would be a Soviet-style system in which the state raised children rather than parents.
Decades later, the United States still suffers from that shortsighted decision. Washington must adhere to state law and provide adequate support for child care providers. But national attention is required to help our economy achieve its full potential.
