Impact of Child Care Crisis on our Economy

by Akram Alhadainy

The COVID-19 health emergency has been affecting every aspect of our lives, from social interactions to commerce and beyond. Despite the encouraging trends that we are seeing, our economy is suffering. One sector that had been severely harmed by COVID and is currently playing a vital role in our economy’s recovery is child care. A Report done by ReadyNation has revealed that in 2019, 32% of parents were having difficulties finding child care providers, the average annual cost of center-based child care for infants surpassed the average cost of public college tuition and fees in most states (including Connecticut), and only 11% of the nationwide child care providers are accredited. Such inadequacies and difficulties have been impacting parents, employers, and taxpayers alike with an estimated economic impact of $57 billion every year. Connecticut’s share of that economic loss is estimated to be $765 million per year.

Since then, the child care crisis and its consequences have been exacerbating exponentially as a result of the child care sector shrinking by approximately 17% during a time where half of American families (44% in Connectiuct) live in a child care desert. This reduction coupled with other impacts of COVID forced many parents to make the hard choice of leaving the workforce and staying at home to care for their children. During COVID, women’s employment rate fell to its lowest since 1988. Female workforce participation had decreased substantially more than that of males with 2.4 million females leaving the workforce compared to 1.8 million males. This drop equivalates to 3.1% of female workforce participation and 2.1 percent for males. Women with children constitute the majority of this drop.

In spite of the economic recovery that we have been witnessing recently, women still lag behind and are not expected to return to pre-COVID employment rates until the end of 2024. These data are worrisome to most experts because these women performed essential jobs, ranging from providing vital infrastructure services to healthcare services, and thus their absence will result in a long-term, significant shortages. Moreover, women’s participation in the labor force is the key to economic recover and the lack of their participation will result in a very slow recovery: “women, particularly college educated women, had driven Great-Recession recovery in labor force participation. Conversely, slower growth in female labor force participation accounted for an estimated 70 percent of the slowdown in employment growth during previous recoveries” (Bishop et al.). Even for those women who were lucky to not get laid off during COVID, the lack of quality child care is still significantly impacting them, and therefore the economy as a whole.

That is because without access to high-quality, affordable child care, working parents have difficulty focusing on work, staying productive and advancing in their careers. A representative sample of the population shows that: 25% of working parents reduce regular work hours, and turn down training opportunities and new job offers; 16% decline getting a promotion; and 15% change from full-time to part-time employment. Recently, the state of Connecticut has recognized the child care crisis: “We cannot reopen our economy if families do not have safe, reliable, affordable care … Long before the pandemic, the child care industry was struggling” said the members of Connecticut’s Congressional delegation in a joint statement – including Senators Richard Blumenthal and Chris Murphy, and Representatives John Larson, Joe Courtney, Rosa DeLauro, Jim Himes, and Jahana Hayes. There have also been attempts to improve the situation, with government Lamont heightening the awareness of the importance of child care to the state’s workforce and economy. He “has supported the Connecticut Office of Early Childhood’s dedicated efforts to support child care workers, help stabilize child care programs, and recognize high standards across the child care system”. These actions were followed by calls from President Biden to pass a bill that supports child care, among other sectors. In October of 2021, President Biden visited Connecticut to promote this bill.

Works Cited

Bishop, Sandra, et al. ReadyNation, Council for a Strong America, 2021, Female Labor Force Participation Is Key to Our Economic Recovery, https://strongnation.s3.amazonaws.com/documents/1342/b7d7b231-fc99-4c05-99de7b2d735703d6.pdf?1627393747&inline;%20filename=%22Female%20Labor%20Force %20Participation%20Is%20Key%20To%20Our%20Economic%20Recovery%20%20.pd f%22.

Bishop-Josef, Sandra, et al. ReadyNation, Council for a Strong America, 2019, Want to Grow the Economy? Fix the Child Care Crisis, https://strongnation.s3.amazonaws.com/documents/602/83bb2275-ce07-4d74-bceeff6178daf6bd.pdf?1547054862&inline;%20filename=%22Want%20to%20Grow%20the %20Economy?%20Fix%20the%20Child%20Care%20Crisis.pdf%22.

“Governor Lamont Announces Historic Investments in Child Care Programs Impacted by the COVID-19 Pandemic.” Connecticut's Official State Website - The Office of Governor Ned Lamont, 26 Mar. 2021, https://portal.ct.gov/Office-of-the-Governor/News/PressReleases/2021/03-2021/Governor-Lamont-Announces-Historic-Investments-in-ChildCare-Programs.