Raising a child isn’t easy, and it certainly isn’t cheap. In the U.S., many parents of young children are struggling to balance work and family as childcare costs get higher – even higher than housing costs in some cases.
“What I am seeing is a patchwork of solutions,” said Rebecca Ryan, an economist, public speaker and author, as quoted by The Business Journals in a Friday article.
In an analysis of childcare trends from 2023, the Childcare Aware America organization found that “in all 50 states plus the District of Columbia, the price of center-based care for two children exceeded average annual rent payments by 25% to over 100%.” It also found that the annual price of childcare for two children also exceeded annual mortgage payments from 1% to 64% in 45 states as well as the District of Columbia.
Other interesting survey findings were that childcare for an infant cost more than in-state university tuition in 39 states and the District of Columbia and that with an average salary of $30,360 per year, it would take more than half of a child care professional’s wage to pay for center-based care for two children annually. According to the report, the national average for childcare was $11,582, It would take 10% of a married couple’s median income to afford it and 32% of a single parent’s median income.
“This is more than the recommendation from the U.S. Department of Health and Human Services that child care should not cost families more than 7% of their annual income,” said the report.
Last year, the White House said the cost of child care had risen 26% in the previous decade and more than 200% over the past 30 years.
“The U.S. child care system is in crisis, leaving more than 50 million parents to patch together child care, facing obstacles like cost, access, reliability, and quality Companies are impacted as parents navigate a broken system,” said a report from the Moms F1rst organization.
However, that report also found that businesses benefitted from offering childcare help to their employees. It said 90% of employers agreed that child care benefits boost talent recruitment and retention and that 88% of employers agree child care benefits boost productivity.
Another recent survey of New York state respondents from the Center for Applied Research on Work from Cornell University found that an overwhelming majority (74%) indicated that they would support public funding for universal child care, “making it a free public service akin to K-12 public education.”
According to research from the Federal Reserve Bank of St. Louis, 53% of adults ages 25-54 working in the U.S. are working parents and 37% have young children. It also found that 67% for mothers with young children and 94% for fathers with young children participate in the labor force.
“High child care costs challenge families with young children,” said the St. Louis Fed.
Per The Business Journals, the federal government gave states $40 billion in funding for child care during the pandemic through the American Rescue Plan and Jobs Act of 2021. While those funds helped 220,000 child care providers and allowed nearly 10 million children to keep receiving care, the funds ran out last September.
Now, it’s election season.
Vice President Kamala Harris, the Democratic presidential nominee has shared her plans to institute a tax cut via the Earned Income Tax Credit and the Child Tax Credit for more than 100 million Americans. She also proposed an expansion of those programs to provide $6,000 in tax relief to families during the first year of a child’s life.
According to Yahoo Finance, GOP candidate former President Donald Trump signed the Tax Cuts and Jobs Act, which included a provision to double the child tax credit, while he was in office.
“However, a number of advocacy groups raised questions about the administration’s suggestion to cut funding for the CCDF and plans to cut funding for after-school programs, which many parents rely on for child care,” said the outlet.
This election season, Trump hasn’t focused much on the issue, said the Associated press. His VP pick, Sen JD Vance (R-Ohio) said he wants to raise the child tax credit to $5,000 but has also opposed government spending on child care, “arguing that many children benefit from having one parent at home as caretaker,” according to the outlet.