Infant Child Care Cost

Infant Child Care Cost in United States

United States

The expense of child care can be staggering, with the annual price of infant care surpassing the cost of rent or mortgage payments in most regions of the U.S. Center-based child care has many forms, such as day nurseries, nursery schools and preschools, that are integral to raising children in the U.S. Child care ? both formal and informal (with the help of family, friends or neighbors) ? allows parents to work and contribute to the economy. 

The demand for child care is rising as the number of women in the workforce increases. Accessible and affordable child care is critical to support full-time working parents. Parents who work nontraditional hours (weekends, night shifts or “on-call scheduling”) face greater difficulty accessing care. Shutdowns during the COVID-19 pandemic exacerbated challenges with access and affordability. Between 2020 and 2021, women with children disproportionately left the workforce to care for children at home, and more than 98,000 childcare workers left the industry.

A study of working parents found that inadequate child care had serious negative effects on work performance and career opportunities. Roughly 25% of these working parents had to either reduce work hours, decline additional training or turn down new positions due to inadequate child care. The annual economic burden of child care costs 8% to 19% of a family’s income for one child. Lack of access to affordable child care costs the U.S. economy $122 billion annually in lost earnings, worker productivity and revenue.

Populations most affected by high child care costs include: 

• Low-income families.
• Parents with more than one child.
• Parents of children with special needs.
• Households led by divorced or single parents.
• Hispanic/Latino households compared with non-Hispanic/Latino households.
• Counties with a majority Black population compared with counties with a majority white population.

One approach to improving access to child care is through public funding. The largest source of public funding for child care is the Child Care and Development Block Grant. This federal grant program helps 1.4 million U.S. children annually by providing child care subsidies for low-income working families and funding child care quality initiatives. Many strategies at state and local levels have been used to increase access to child care for low- and middle-income families. The main recommendation at the federal level is to increase investments in child care assistance, such as subsidizing preschool and connecting families to early learning programs, including Head Start and Early Head Start. 

Additionally, there is great need for policy action at the federal level. The Child Care for Working Families Act will improve access to affordable child care for families with children ages 0 to 5 years. If passed, this legislation will cap costs for working families, improve the quality of child care and support higher wages for child care workers.

Belfield, Clive R. “The Economic Impacts of Insufficient Child Care on Working Families.” ReadyNation/Council for a Strong America, September 2018. https://strongnation.s3.amazonaws.com/documents/522/3c5cdb46-eda2-4723-9e8e-f20511cc9f0f.pdf?1542205790&inline;%20filename=%22The%20Economic%20Impacts%20of%20Insufficient%20Child%20Care%20on%20Working%20Families.pdf.

Child Care Aware of America. “Demanding Change: Repairing Our Child Care System,” 2022. https://www.childcareaware.org/demanding-change-repairing-our-child-care-system/.

Christin Landivar, Liana, Nikki Graf, and Rayo Altamirano. “Childcare Prices in Local Areas,” January 2023. https://www.dol.gov/sites/dolgov/files/WB/NDCP/508_WB_IssueBrief-NDCP-20230213.pdf.

Giannarelli, Linda, Gina Adams, Sarah Minton, and Kelly Dwyer. “What If We Expanded Child Care Subsidies?: A National and State Perspective.” Washington, D.C.: Urban Institute, June 2019. https://www.urban.org/sites/default/files/publication/100284/what_if_we_expanded_child_care_subsidies_6.pdf.

U.S. Chamber of Commerce Foundation. “Piecing Together Solutions: The Importance of Childcare to U.S. Families and Businesses,” December 2020. https://www.uschamberfoundation.org/sites/default/files/EarlyEd_Minis_Report6_121420_Final.pdf.

Whitehurst, Grover J. “Russ.” “Why the Federal Government Should Subsidize Childcare and How to Pay for It.” Evidence Speaks Reports Vol 2, #11. Brookings, March 9, 2017. https://www.brookings.edu/research/why-the-federal-government-should-subsidize-childcare-and-how-to-pay-for-it/.