Understanding the Impact: An Overview of Research
According to the First Five Years Fund “Studies show that early childhood education has at least a 4X-9X return on investment per dollar and not only benefits the health, education, and development of young children and supports parents currently, but also leads to increased earnings, employment, and safety in the future.”
The benefits of child care and early learning investments are multifaceted, intergenerational, and include positive impacts to:
A child’s brain development, readiness for school, mental and physical health, future employment and earnings, and potential less involvement with social benefit programs.
A family’s ability to join and stay in the workforce and meet their basic needs.
An employer’s ability to attract and retain a vibrant workforce for generations to come.
Washington state’s ability to support thriving communities and become the best place to raise a family and run a business.
In this section, we will explore the many powerful impacts of child care and early learning investments. Click the following links to jump ahead to a specific category:
A report by the Marshall Plan for Moms found that “for 80% of families, child care exceeds the Department of Health and Human Services (HHS) recommended affordability level of 7% of household income.” The income needed for a family with two young children to be able to afford quality child care at its current average rate is $260,000 per year – a preposterous and wholly inaccessible figure.
Workforce Participation: Child care is a barrier for parents, especially women, to enter or remain in the workforce. In September 2020, 863,000 women dropped out of the workforce compared to just 168,000 men. According to a 2022 U.S. Chamber of Commerce Report:
“Both men and women suffered a 3% drop in labor force participation at the height of the pandemic. But more than two years later, men have returned to work at a higher rate than women. Today, women’s labor force participation is still a full percentage point lower than it was pre-pandemic, meaning an estimated one million women are missing from the labor force.”
Most households with young children have all available adults working, creating an even greater need for accessible and affordable childcare. The trend of dual-working households has increased as housing and other household costs continue to increase. Parents cannot afford to stay home, but they also struggle to afford and find child care that allows them to remain or enter the workforce. According to the First Five Years Fund, in 1970, 48% of U.S. households had a parent at home, typically the mother. As of 2022, 67% of all households with children 6 and younger have working parents and require additional care.
A U.S. Chamber of Commerce report conducted in December of 2020 found that 58% of parents who reported leaving the workforce were unable to find child care solutions that met their needs – and 32% of women cited the need to be home to care for family members as a barrier to returning to work. The COVID-19 pandemic stressed an already stressed system, as child care providers were forced to reduce capacity and hours in response to the pandemic, while also struggling to hire and retain child care workers. The strain placed on providers and the impact of operating an already difficult business operation during a pandemic has caused further collapse of the child care industry for many providers of all types across all communities.
In December 2020, one in four child care providers were closed, and in September 2020, 67% of school-aged children were enrolled in distance learning or attending school remotely – all while countless child care educators worked tirelessly to accommodate the evolving needs of children of varying ages seemingly overnight. In anticipation of child care disruptions, Congress provided unemployment insurance benefits to parents who were unable to work due to reasons related to COVID-19, one of which was the need to stay home to care for a child. Many parents, particularly women, left their jobs for that reason.
Workforce Shortages - A Domino Effect: Workforce shortages in the child care industry have a direct impact on child care access. For example, one toddler teacher shortage in a classroom can lead to at least seven families not having access to care - and therefore being unable to work. Workforce shortages for most other industries are tied directly to current and prospective employees being able to find and afford child care.
The High Cost of Care: Washington ranks third in the nation for least affordable child care for an infant in a family child care program. Child Care Aware of Washington reports that the average cost to have an infant in a child care center is 15.4% of median income for a married couple and a daunting 51.5% of median income for a single mother. While median household incomes have increased 5% since 2010, median child care rates have increased between 13-20% for center-based care and 11-31% for family child care.
Child care assistance is available for low income working parents through Working Connections Child Care (WCCC). However, many working families who need assistance do not qualify for WCCC; see Section IV for more details and income eligibility.
The U.S. Chamber Foundation Employer Roadmap illustrates, “Working parents have long struggled to access the affordable, quality childcare that enables them to participate in the workforce, but COVID-19 has made things even worse. The resulting impact on our workforce and organizations of every size and sector is more acute than ever and, for employers, it’s affecting their bottom line.”
The cost of employee turnover in Washington is estimated to be at least 50-120% of an employee’s salary.
Engaged and supported employees increase retention and create a culture of support and trust while reducing employee turnover and absenteeism; these benefits occur for employees with and without children.
Employers need workers available to work. For example, when just one preschool classroom cannot be staffed, the result can be up to ten parents not able to go to work or school.
In a state known for innovation and industry, investments in early learning and child care can help accelerate powerful job growth and attract both people and businesses to our state.
Child care and early learning programs are community builders. Child care and early learning play a crucial role in supporting families and building strong communities. Access to high-quality child care can help parents balance work and family responsibilities, which can improve their mental health and overall well-being. It can also have positive impacts on children's development, as they have the opportunity to socialize with their peers and engage in age-appropriate activities that support their cognitive, social, and emotional development – overall creating healthy community members today and into the future.
In addition to these individual benefits, investing in child care has broader economic and social benefits for the community. It can help increase parents’ participation, particularly women, in the workforce, which can boost economic productivity and contribute to the overall prosperity of the community. It can also help to reduce income inequality and improve social mobility, as families have access to affordable and reliable child care that enables them to pursue education and employment opportunities. Families have a central point of access to resources and support for themselves and their children, such as speech therapy, food access and other important community services.
Child care access issues were already a significant problem before the pandemic. According to a U.S. Chamber report: “Washington employers incurred costs of $2.08 billion related to employee turnover or missed work due to child care issues.” Washington’s economy experienced a $6.5 billion loss due to the direct and indirect costs related to the inability of employees to access and keep child care.
A lack of access to child care has significant negative impacts on employers and the overall economy. When parents are unable to access and pay for reliable child care, it can lead to absenteeism, turnover, and reduced productivity at work. This can result in higher hiring and employee absentee costs for employers, as they may have to spend more time and resources recruiting and training new employees or covering for absent workers.
In addition to these costs, a lack of access to child care can also have broader economic consequences. When parents are unable to work due to a lack of child care, they have less disposable income to spend on goods and services, which can lead to reduced economic activity and slower growth. It can also result in lower tax revenues for governments, as parents may have lower incomes and pay less in taxes.
Access to affordable and reliable child care is important for both individual families and the overall economy, as it can help to increase participation in the workforce, boost productivity, and support economic growth.
Due to either lack of openings and/or the high cost of tuition, child care programs and capacity statewide has never been adequate for the number of working families who need or want access. Child Care Aware of Washington reports that since 2014, overall child care slots have declined by ~5%, despite the increased need and demand – and since 2020, there has been a net loss of nearly 150 providers and around 1,500 slots in Washington state. Nearly 40% of the net loss of providers is center‐based, representing 60% of the capacity lost. The ongoing effects of the COVID-19 pandemic have only exacerbated this shortage.
The Department of Children, Youth, and Families reports, “Statewide, DCYF estimates that families of about 305,000 children age birth to 5 not yet in school need child care. Only about 34% of those children are enrolled in licensed child care or preschool.”
The approximate capacity for licensed child care sits at 188,000 children (Department of Children, Youth, and Families). Capacity decline is largely due to rising costs of child care – such as teacher wages and employee costs for such a labor-intensive job – with a simultaneous lack of workforce pipeline. In fact, four out of every five respondents from child care centers in a recent National Association for the Education of Young Children survey said they had a staffing shortage - and 15% reported a “major shortage” of 6-15 fewer workers than needed. Workers are opting for jobs with higher pay and less stress, particularly as so many have experienced burnout from working throughout the pandemic. The New York Times estimates that approximately 100,000 individuals left the child care workforce throughout the pandemic, most of whom will not return.
According to the U.S. Chamber of Commerce report Understanding America’s Labor Shortage: The Scarce and Costly Childcare Issue, “The nationwide worker shortage crisis has also taken a toll on the childcare industry. Before the pandemic, there were 920,000 workers in the childcare sector. Childcare employment plummeted by more than 30% at the height of the pandemic and is still 7% lower today.”
The Bottom Line: If more providers had the resources to hire and retain the child care and early learning workforce, the supply of child care centers and homes would expand to better meet the demand of families statewide. If more families could access affordable, quality care and early learning programs for their children, they could sustainably participate in the workforce and positively contribute to the economy.
Why is Child Care so Expensive?
The primary driver of the cost of child care is the need to pay employees a competitive wage in order to attract and retain qualified staff. High-quality child care often involves low child-to-teacher ratios, which can be expensive to maintain. Additionally, child care providers may need to invest in training and professional development for their staff, as well as in resources and equipment to create a safe and nurturing environment for children. Current workforce shortages in all industries have made hiring and retaining staff even more challenging and costly.
In addition to the cost of tuition, there may be additional fees for supplies, meals, and other services. Some families may be able to receive assistance with the cost of child care through government programs or employer-provided benefits, but most programs do not subsidize or reimburse enough to cover the full cost of child care and early learning program operations or make it truly affordable for most.
The Child Care Business Model
Child care in the United States and Washington state is a mixed-delivery system, giving parents a range of program types and options to choose from when selecting child care for their family. The Bipartisan Policy Center identifies the main issue as the lack of capacity and quantity of programs. The cost associated with operating the different program types can vary greatly depending on the setting and operation costs; however, due to the high employee need for all program types, the tuition for all program types remains unaffordable for most families.
Source: American Progress - The True Cost of High-Quality Child Care Across the United States
The brain science is clear that children are born learning. Whether in their home or community, a rich learning environment filled with adult interactions helps children develop and thrive. Providing families with a variety of early learning and child care options that meet their needs and preferences can positively impact the child, family, and community.
90% of all brain development happens by age 3.
According to Harvard University’s Center on the Developing Child:
“Emotional well-being and social competence provide a strong foundation for emerging cognitive abilities, and together they are the bricks and mortar that comprise the foundation of human development. The emotional and physical health, social skills, and cognitive-linguistic capacities that emerge in the early years are all important prerequisites for success in school and later in the workplace and community.”
The Building Blocks:
Social emotional skills are the building blocks for critical thinking and collaboration. For children of parents who work or go to school and place their child in care, this means the skills and abilities our schools and employers are looking for are first developed in child care and early learning settings across Washington state.
According to Harvard University’s Center on the Developing Child: "Scientists have discovered that the experiences children have early in life—and the environments in which they have them—not only shape their brain architecture, but also affect whether, how, and when the developmental instructions carried in their genes are expressed across multiple biological systems."
Per a report by Harvard University’s Center on the Developing Child:
“In the first three years after birth, infants and toddlers can start learning to use these core capabilities in basic ways—like learning to focus their attention, responding to limit-setting, and following simple rules. Between ages 3 and 5, most children make huge gains in using these skills through creative play, learning to adjust flexibly to different rules for different contexts, and resisting impulsive behaviors. By later childhood and adolescence, with the benefits of growth-promoting experiences and support, our brains are ready to build on these foundational skills to navigate more complex situations—resisting peer pressure, setting long-term goals and plans, and dealing productively with setbacks."
The National Conference of State Legislatures finds “The basic principles of neuroscience indicate that early preventive intervention will be more efficient and produce more favorable outcomes than remediation later in life.”
Relationships between a child and their caregivers and teachers is a core component to high-quality early learning. Again, from a report by Harvard University’s Center on the Developing Child:
“Responsive relationships early in life are the most important factor in building sturdy brain architecture. Think of building a house: The foundation establishes a base upon which everything else is built. The same is true with developing brains. Brain architecture is comprised of trillions of connections among billions of neurons across different areas of the brain. These connections enable lightning-fast communication among neurons that specialize in different kinds of brain functions.”
The developmental benefits are even higher when a child and family are in a home that reflects their culture and is in their home language. According to the Head Start Early Childhood Learning and Knowledge Center, children who speak home languages other than English account for more than one-third of all Head Start program enrollments nationwide.
Stress and Trauma:
Reducing stress in a child’s life and environment is critical for healthy development and future stability. A final take away from a report by Harvard University’s Center on the Developing Child:
“Learning to deal with stress is an important part of development, but the unremitting stress experienced by millions of children and families experiencing deep poverty, systemic racism, intergenerational trauma, community violence, interpersonal discrimination, parental substance abuse and/or mental illness can, without treatment, cause long-lasting problems for children and the adults who care for them.”
Children who attend supportive, high-quality early learning programs – which reflect their families and cultures, create strong caregiver-child relationships, support their core skill development, and reduce stress – are more likely than their peers to be successful in school, the workforce, and life. All benefits for children in their early years will ultimately benefit society.