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Child care crisis seen as barrier; lack of availability slowing participation in workforce

by Compiled Democrat-Gazette Staff From Wire Reports | October 28, 2021 at 6:53 a.m.
Health care workers motor across Lake Titicaca in Puno, Peru, on Wednesday with a load of coolers filled with doses of the Pfizer covid-19 vaccine as part of a door-to-door vaccination campaign. (AP/Martin Mejia)

SEATTLE -- As covid-19 puts new strains on parents, the pandemic is making clear what many experts had long warned even in more stable times: 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 that 9% of licensed child care programs, known for low wages for workers and high costs for consumers, 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 a year for child care.

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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 proposes increasing the size of a tax credit for the cost of child care, all of which could 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 today 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 congressional negotiations 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.

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"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. There is not 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 over the stress of the pandemic, though she 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 on the restaurant that employs her to hand-bread seafood.

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

"It's been a nightmare, and it's not over," she said.

LICENSE SHARING

In news Wednesday from the covid-19 fight, U.S. pharmaceutical giant Merck agreed to share the license for its experimental covid-19 drug, molnupiravir, with a nonprofit organization so that it can be manufactured widely around the world in a deal that would expand access to the treatment in more than 100 countries.

The move could make the treatment, an easy-to-take pill shown to reduce the risk of hospitalization and death in some cases, available to millions in mostly low- and middle-income nations -- if regulators authorize its use.

Merck announced in October that a global clinical trial showed the antiviral pill reduced hospitalizations and deaths by half among higher-risk coronavirus patients diagnosed with mild to moderate illness.

The company agreed to share its license with the United Nations-backed Medicines Patent Pool, which in turn can license it to manufacturers.

The deal is designed to expand the drug's availability, widen its manufacturing base and potentially push down the price.

The U.S. government is paying about $700 per course of the molnupiravir treatment, the New York Times reported. But, according to Brook Baker, a professor of law at Northeastern University who has tracked the negotiations over the drug, the price of a course of treatment could fall below $10 as competition increases among manufacturers and production scale grows.

Molnupiravir has yet to receive approval from either U.S. or European regulators. Merck applied to the U.S. Food and Drug Administration for emergency-use authorization this month, and the European Medicines Agency recently began a rolling review of the drug.

Information for this story was contributed by Sally Ho and Josh Boak of The Associated Press; and by Adam Taylor and Claire Parker of The Washington Post.

Mayor Libby Schaaf of Oakland, Calif., waves her vaccination card Wednesday after getting a Pfizer covid-19 booster shot at Asian Health Services in Oakland.
(AP/Jeff Chiu)
Mayor Libby Schaaf of Oakland, Calif., waves her vaccination card Wednesday after getting a Pfizer covid-19 booster shot at Asian Health Services in Oakland. (AP/Jeff Chiu)

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