Childcare costs more than college in some states—and that needs to change

Exorbitant childcare costs are a burden on a generation already struggling.

Childcare costs more than college in some states—and that needs to change

According to a new study by the Federal Reserve, millennials have less money than previous generations. This is not news to millennial parents, who live the story painted by the Fed study's numbers. Student debt is a factor for this generation in a way it wasn't for those who came before us, and while we work to pay off our own college educations, saving for the next generation's is difficult—because families are also facing a childcare crisis.

One in five American families spends more than 25% of their income on child care, and for single parents, that number soars to more than 50%.

In fact, childcare is so expensive that in many states it costs more than getting a college education.

In Kansas, for example, the cost of annual full-time childcare for an infant will run you about $11,000, while one year of fees and tuition at a public college costs around $9,200. In Colorado, the difference is even more stark, with full-time childcare costing on average about $15,000 annually while the price tag for one year at a public college is about $10,800.

The high price tag that comes with child care not only puts a burden on working parents, but can affect outcomes for children as well, according to Child Care Aware, a non-profit organization working to advance the affordability, accessibility, and quality of child care environments.

"Early child care does more than support parents who must work or go to school: It also provides important early learning opportunities that can contribute to school readiness, short- and long-term physical health, and positive social and emotional development—all of which are essential to creating an environment able to deliver equitable outcomes for all children in all communities," the organization wrote in its 2018-2019 policy platform. "Unfortunately, child care costs, which have nearly doubled in the last quarter century, are often a barrier to accessing high-quality care; indeed, these costs pose a crippling burden for many families with young children."

The exorbitant cost of child care also has an effect on the overall economy, essentially leaving new parents with little options to fully participate in the workforce, and disproportionately affecting mothers.

According to a 2017 report from the Hamilton Project, 57.2% of working-age women participated in the labor force in 2016, down from 60.7% in 2000. Additionally, a larger share of women work part-time, about 24.9% of women compared to 12.4% of men. Among those who work part-time voluntarily, 6.5% of women cited "problems with childcare" as a reason for doing so, compared to 0.8% of men.

Given the statistics, the outlook for new parents can seem grim, but the good news is it doesn't have to be this way. Other countries provide models for ways to support working families and make child care more affordable.

The U.S. is somewhat of an outlier among developed countries in that child care in the U.S. is mostly privatized, shifting the burden of costs onto families, while many other countries tend to offer more substantial public support for both paid parental leave and child care.

For example, the U.S. spends less than 0.5% of GDP on early childhood education, compared to 1.6% of GDP in Sweden and 1.8% in Iceland, according to the Organization for for Economic Cooperation and Development.

The Canadian province of Quebec serves as a model for providing robust child care assistance. Quebec provides generous parental leave, monthly cash benefits families can use for their children, and a heavily subsidized child-care system.

Quebec's family policy begins with up to 55 weeks of paid leave for parents when they have a child, in addition to an annual allowance of anywhere from $500 to about $1,900 (in American dollars) that families receive per child under the age of 18. Additionally, the province offers a full-day, year-round child care program for all children under age 5, which is subsidized to the tune of roughly $2 billion a year in public funding. Under this system, Quebec families cover part of the costs on a sliding scale, with the wealthiest families paying more than lower-income families.

Quebec's family policy demonstrates the economic benefits of supporting parents. The combination of subsidized child care and paid parental leave has resulted in 80% of Quebec mothers with children 5 or younger participating in the labor force.

While a similar model might seem far-fetched in the U.S., the majority of both Democrats and Republicans support government intervention to make child care more affordable. Parents can advocate for more affordable childcare by getting involved with organizations like Child Care Aware, and urging their elected officials to take action by passing the Child Care For Working Families Act of 2017, which would ensure families have access to high-quality, affordable care and would encourage states to create universal child care programs.

The numbers don't lie: This generation has less "lower earnings, fewer assets and less wealth," according to the Fed study. We are working to change that, but we need affordable childcare so that we can go to work.

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