The Cost of Child Care is a Major Reason We Aren't Having More Kids, But Maybe We Have a Solution
As we reported last week, America's birthrate has fallen below the replacement level over the last decade and it's becoming a public policy concern.
Illuminate: "Falling birthrates are concerning because they signal that the nation will not be replenishing its workforce and will face declining tax revenue to support baby boomers as they continue to retire."
In the coming years, we could replace some of these missing workers by increasing immigration ceilings, but that would face substantial political opposition. So, it would be wise to explore the reasons Americans have decided to have fewer children and how we might address those issues.
The cost of child care is at the top of the list. It has risen about 2,000 percent in the last 40 years, faster than college tuition, health care or pretty much anything else parents spend money on.
The Atlantic: "Pick whatever source and statistic you like, because they all point to the same conclusion: Child care in America has become ludicrously expensive. The average cost of a full-time child-care program in the U.S. is now $16,000 a year—and more, in some states, than tuition at a flagship university."
USA Today: "Child care costs exceed $20,000 a year in 22 states, including Oregon, Colorado, Minnesota, Illinois, Pennsylvania, New Jersey and New York. Massachusetts parents pay the most, shelling out $34,381. Such rising costs can essentially cancel out entire salaries — even decent ones. "
Addressing the rising cost of child care is difficult because it's labor intensive and safety is our primary concern. If we allow facilities to reduce staff to save money, each child gets less attention and we increase the chance of accidents. And we can't cut labor costs by paying employees less because they are already some of the lowest paid workers in the nation. Additionally, daycare facilities require real estate, liability insurance, and a significant investment in play equipment, furniture and safety features.
Moreover, caring for children between birth and five years should include much more than just keeping them safe. Those first five years are critical to a child's development.
The Atlantic: "Neuroscientists and psychologists have established that the first five years of a child’s life are crucial for the development of logic and language skills. Early education has profound effects on both these cognitive skills and “noncognitive” skills, such as grit, teamwork, and emotional health."
And, think about this. Does it make sense to provide public schools from K through 12 and extend tuition assistance for college, but not help families afford high quality day-care for their children during their first five years of development?
So, how do we provide affordable care while maintaining safety standards and increasing quality? There are no easy answers, but perhaps we can learn something from America's past.
During World War Two America faced a labor shortage so many women took jobs in manufacturing to support the war effort. As today, many of those workers were also mothers so we needed to help them take care of their young children. The federal government stepped in with a common-sense solution, the Lanham Act of 1940. Among other things, the law established federally subsidized child care centers nationwide.
White House Archives: "The law was passed in order to fund public works, including child care, in communities with defense industries. Under it, all families (regardless of income) were eligible for child care for up to six days a week, including summers and holidays, and parents paid the equivalent of just $9-$10 a day in today’s dollars. In addition to being affordable, this care was also high-quality. Many centers had low student-teacher ratios, served meals and snacks, and taught children arts and educational enrichment activities."
In 1944,130,000 children were enrolled in child care facilities established and funded by the Lanham Act, and it was very popular with the mothers. But, was it a good investment of tax dollars?
White House Archines: "A recent study by Chris Herbst (2014) shows that the benefits of the Lanham Act for parents and children were much broader.... Moreover, the program also improved children’s long-term outcomes through their working years: an additional $100 in Lanham Act funding increased high school graduation rates by 1.8 percentage points, college graduation rates by 1.9 percentage points, and employment at ages 44-59 by 0.7 percentage point. Overall, the Lanham Act increased participants’ annual earnings by an average of 1.8 percent. Using a summary index of adult outcomes, the per-dollar long-term benefits to children from the Lanham Act are comparable in magnitude to more recent early childhood investments, including Head Start and universal preschool in Georgia."
Creating such a program today would face substantial political opposition [creeping socialism], but it should remind us of what's possible if prioritize our children's future.
By: Don Lam & Curated Content