Vadym Buinov | moment | Getty Images
The Covid-19 pandemic brought to the surface both cracks and resilience in the American economy, with child care taking center stage as day care centers closed, schools closed and parents tried to juggle their children with their jobs bring.
While employment in the child care sector has returned to baseline levels post-pandemic, according to the latest data from the Bureau of Labor Statistics, a shortage of workers and available spaces for children in some areas is weighing on the sector.
Costs are also rising for families. A February report from Bank of America showed that costs for families increased by 15% to nearly 30% in the fourth quarter of 2023 compared to a year ago in terms of the average child care payment per household income between $100,000 and $250,000 per year .
Proponents of the policy argue that child care, including for infants and toddlers, is an economic problem that affects all Americans, not just those with young children.
Billions in American Rescue Plan Act stabilization funds earmarked for the child care sector expired last fall, which could lead to increased costs for families or centers that close their doors.
ReadyNation, an advocacy group of more than 2,000 business leaders, advocates at both the state and federal levels for policies and programs that support a strong workforce and economy, including child care.
The group released a report in 2023 that found the infant and toddler care crisis costs the U.S. an estimated $122 billion each year in lost earnings, productivity and sales. That’s up from $57 billion in 2018, before the pandemic exposed and exacerbated gaps in the system for working families and the businesses that rely on them.
ReadyNation’s study found that a combination of “Covid-19 and inadequate policy responses have now made the crisis significantly worse.”
“All taxpayers are affected by this. “We must recognize that taxpayers lose $1,470 per working parent each year due to lower income taxes and lower sales taxes due to the lack of purchasing power of the unemployed,” said Nancy Fishman, national director of ReadyNation.
Part of the statewide solution is to support what the group calls the “workforce behind the workforce” — early childhood child care providers.
“Supporting early childhood educators could include, among other things, ensuring that childcare workers have access to social benefits. We all know how important benefits are, whether it’s health benefits or the ability to find quality child care for your own children,” Fishman told CNBC. “Programs that support additional education and training for child care providers are also important.”
Solutions in the Golden State
In California alone, the economic damage, including lost profits, productivity and revenue, is estimated at $17 billion, ReadyNation predicts. That’s more than any other state in the country, according to the group’s estimates.
According to an analysis by the Center for the Study of Child Care Employment, child care jobs in the state have rebounded to 2020 levels since this spring, while other states have seen larger job gains following the pandemic.
Some child care providers in California joined forces in 2019 with Child Care Providers United, which now represents more than 40,000 licensed and unlicensed in-home child care providers, friends and family. The providers are part of California’s state funding program and the union is a partnership of SEIU Locals 99 and 521 and UDW/AFSCME Local 3930.
The group received its first contract in 2021 and gained access to the nation’s first retirement benefits.
The union says child care providers are currently reimbursed a percentage of the cost it costs them to provide care in the state. The average wage for child care workers is $7 to $10 an hour, with many providers not reporting take-home pay, it said.
Providers are currently advocating for full cost of care reimbursement through the state budget process to add dignity to their work, keep providers open, and attract new providers to the workforce.
Deborah Corley-Marzett runs a home-based subsidized care center in Bakersfield, California. She told CNBC she would like to hire more staff to support her and the children, but it is difficult to find the right fit and offer competitive wages in this environment. Low-wage workers in the state’s fast-food sector, for example, just secured a historic minimum wage of $20 an hour, putting pressure on other sectors to keep up.
“I have a problem with staff shortages. I literally can’t afford to hire someone to come and work with me in the morning right now. I can’t afford that,” Corley-Marzett said. “I don’t have enough children at the moment. But I physically can’t take in any more children.”
Lawmakers argue that progress has been made, but there is still much work to be done. State Sen. Nancy Skinner, a Democrat who represents parts of the Bay Area and chairwoman of the California Women’s Caucus, said the group continues to prioritize early childhood care and education. The group advocated for an increase in federal spending on early childhood and education by $2 billion over the past two years, to a total of $6.5 billion.
The caucus’ current focus is maintaining consistent reimbursement rates for child care providers as the state struggles with a budget deficit.
“We have low unemployment, but many sectors of the economy are looking for workers,” Skinner told CNBC. “If your family is in a situation where you can’t go to work because you don’t have adequate childcare or can’t afford childcare, then you can’t do the job that’s there waiting for you. “.”
Don’t miss these exclusives from CNBC PRO
Source link
2024-06-08 12:00:01
www.cnbc.com
