• Megan Nestor

The Only Way to Rebound the Economy is with Child Care


A few times a week, I FaceTime with my nephews, both of whom recently returned to child care after a few months away due to the pandemic. 3.5-year-old Thomas always has new things to teach me from his time in “school.” He talks about gravity and the planets, macrophages that fight viruses, and butterflies emerging from chrysalises. 1.5-year-old Charlie recently moved into the “toddler room,” and his language skills have since exploded. He babbles in coherent, nearly-full sentences now—about the bubbles in his bath, about the color of his toy train, and about any number of “bookies” that he loves to read.


And Thomas and Charlie’s mom—my sister—has been able to return to her own job as an elementary school psychologist, because she feels confident and comfortable in the child care that her boys are receiving. She’s able to return to work and actively participate in the labor force, avoiding the potential motherhood penalty she’d face if she left her job to care for her boys.

My sister’s family is not unique in the benefits they see from child care (though they are lucky to have available care during the COVID-19 pandemic), but they are a strong example of how critical child care is for working families.


Child care is good for families and critical for the economy.

First and foremost, quality child care is good for kids. It supports physical, social, emotional, and cognitive development. It prepares children for Kindergarten and later schooling, and can help to close the achievement gap. But child care is also a critical part of our economy’s infrastructure. It allows parents with young children, like my sister, to work and be an active part of the labor force. And affordable child care opens up opportunities for economically vulnerable workers as well.


COVID-19 is threatening an already-fragile system.

Even before COVID-19, there were gaps in child care. COVID has exacerbated these gaps, forcing providers to decrease their capacity even more. In Allegheny County, there was an estimated gap in child care for kids under five of almost 8,600 seats—before COVID-19. Now, our estimates show that there could be an additional 15,600 seats unavailable as some providers close permanently, others decrease capacity due to health and safety concerns, and parents are fearful of sending their children to congregant care.

In Allegheny County, there was an estimated gap in child care for kids under five of almost 8,600 seats—before COVID-19. Now, our estimates show that there could be an additional 15,600 seats unavailable.

Child care providers are struggling financially, and if they close permanently, there will be big impacts on the sector and ripple effects for the labor market. Child care providers were already operating under tight margins before the pandemic, with poor salaries for child care workers and uncertain and complicated funding streams. Now, they face increased costs for PPE, staff leaving the workforce, and decreased revenue from both the public and private markets.


Between the gaps we’re seeing in child care capacity and the funding threats providers are facing, there is real concern over what this means for child care long-term. When COVID ends and people re-emerge fully into the economy, what will happen to working parents if there is a huge shortage of child care?


Even before COVID, working parents were exiting the workforce every year due to child care issues. COVID has exacerbated this issue, with some estimates saying as many as 12% of working parents are unlikely to return to work—that could be almost 11,000 workers with children under five in Allegheny County. On top of the impacts workers and families themselves will face, there are real losses in the form of state and local income taxes and costs to employers for turnover-related expenses. And with a previously projected shortfall of 80,000 workers in Allegheny County by 2025, a further dip in labor force participation could have dire consequences for the region long-term.


What can we do?

Investing in quality child care isn’t just an investment in young developing minds — it is also an investment in the health of our economy. The economy cannot function without a functioning child care system, but the system isn’t working and it hasn’t been for a long time. Instead of temporary fixes and emergency band-aids, we have a real opportunity to think about how to build the child care system back better and stronger than it was before. Advocating for and investing in policies like paid family leave, employer-subsidized or -supported child care, and strong, stable funding streams for child care providers can go a long way towards ensuring this critical economic support is resilient and intact for the long-term.


Instead of temporary fixes and emergency band-aids, we have a real opportunity to think about how to build the child care system back better and stronger than it was before.

The results of our full study on the economic impacts of child care in Allegheny County are available here. And see more coverage on this important issue on WESA’s Morning Edition.


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Fourth Economy Consulting
PO Box 81620
Pittsburgh, PA 15217