A crisis in the child care industry affects more than parents and care providers. It impacts the entire economy.
The COVID-19 pandemic has exposed weaknesses in American child care and, indeed, our economic system; that has been well-documented since the beginning of the pandemic 21 months ago. But a recent article in The Columbian provided eye-opening details that illuminates the issue locally.
Since early 2020, Southwest Washington’s child-care capacity has been reduced by about 25 percent because of closures, according to ChildCare Aware of Washington. That is the highest closure rate of any region in the state. In one example, Educational Service District 112 is serving fewer than half the students it previously served in child care and early education centers.
If parents are unable to secure safe and affordable child care, they are unlikely to seek gainful employment. That reduces the workforce — an ongoing problem for employers throughout the pandemic. It also reduces the purchasing power of people who choose not to work and increases the number of people who seek government assistance to make ends meet.
In other words, a lack of child care ripples throughout the economy, slowing the recovery from the pandemic.
The economic shutdown mandated by COVID did not create this situation; it exacerbated shortcomings that already existed in American child care. Now, with the economy inching toward recovery, educational centers have difficulty finding enough workers.
As of 2020, the average annual salary for child care workers in the Vancouver-Portland area was $31,580, according to the U.S. Bureau of Labor Statistics. The average annual wage across all industries was $61,860.
But the issue is more complicated than simply paying more to attract and retain workers. “Families can’t afford to pay more, but businesses can’t operate on the revenue they’re getting from family pay,” Jodi Wall, executive director for early care and education at ESD 112, told The Columbian. “It’s just expensive to provide high-quality child care and it’s more than families can afford to pay. We have kind of a broken system.”
Indeed. While purists argue that an unencumbered market will take care of supply-and-demand issues, child care is one example of a failed market. The parents most in need of reliable child care are those most in danger of being pushed out of the market by price increases.
“Affordability is a huge, enormous issue,” said Julia Maglione, director of communications for Workforce Southwest Washington. “There are people paying more for child care than they make in a wage, so obviously that is not a sustainable model.”
This year, the Legislature passed the Fair Start for Kids Act, expanding eligibility for child care subsidies to families earning up to 60 percent of the statewide average income.
The federal Build Back Better legislation, which has been passed by the House of Representatives, would mandate increased pay for child care workers and universal preschool for 3- and 4-year-olds, but provides little guidance for how states should implement those mandates. The result could create more problems than it solves for states dealing with child-care shortages.
Regardless of whether the bill is passed by the Senate, lawmakers at both the state and federal levels must continue to work on a system that is beneficial to child-care providers and to parents looking for affordable care. Our economy depends on it.