Are Claims of a Crisis in Child Care Overblown?
Our view of a widely reported, COVID-caused child-care “crisis” is almost entirely driven by anecdotal evidence promoted by advocacy groups. To make good policy in a crucial area, we need more reliable data.
The Real Emergency Is CCDF
The data cited here aren’t definitive, but a better picture of the pandemic’s impact on child-care providers is clearly needed to justify billions in emergency funding. What we do know, however, is that lower-income working families’ access to high-quality care has long been inadequate. That’s a well-documented problem, which has been hurting many families and their young children for years.
So, the $15 billion in “Rescue Plan” funds proposed for the federal Child Care and Development Fund (CCDF) — which helps low-income, working families pay for child care — would be money well spent. Increasing subsidies — in both number and amount — also supports child care programs and helps increase program quality, as BPC recently noted, in addition to providing access to high-quality care for the neediest children.
CCDF targets lower-income working families earning less than 85 percent of their state’s median income, which currently ranges from $38,000 in Mississippi to $81,000 in the District of Columbia — averaging $59,000 — for a family of four. Some states set income eligibility limits lower. Still, less than 20 percent of eligible families receive subsidies. And, for those who do, subsidy amounts in almost all states fall short of what’s needed to access the higher-quality care that wealthier families already use for their children, even without federal funds helping them pay for it.
This means that large proportions of the nation’s most vulnerable children lack access to decent child care, while the quality of care matters for exactly those children the most. As a result, healthy development of lower-income children in poor-quality child care is compromised, while workforce participation among parents unwilling to put their children in substandard care is constrained.
This is an emergency, affecting millions of disadvantaged children and their families. And it’s the emergency we should urgently be trying to address. Existing evidence is inadequate to warrant the billions that Biden’s “Rescue Plan” directs to the child-care industry. “Rescue Plan” funds for child care should instead be targeted to the nation’s lowest-income working families via CCDF.
This article was first published by the American Enterprise Institute.
Image: "Daycare/Preschool" by teofilo is licensed under CC BY 2.0