THE ECONOMIST: Child care challenges

One of the most significant problems facing working parents is finding high-quality, affordable child care. It’s an issue not only for the families involved, but also for the workforce, the economy, society, and long-term prosperity. It’s a complex milieu which I certainly can’t fully untangle in the space of a brief column, but let’s examine a few critical points.

Child care providers are facing notable challenges. Operating expenses have risen, and some facilities are unable to remain financially viable. In addition, it is very difficult to find employees due to general labor shortages and low wages in the industry (averaging $11-$13 per hour). With insufficient staff, potential enrollment is curtailed. The inevitable outcome is a vicious cycle of worsening shortages.

For parents, affordability is essential. Care for an infant can cost well over $10,000 per year, more than tuition, books, and fees at some four-year universities. For families with multiple children, these costs can be difficult, if not impossible, to manage.

While over 85% of child care costs are funded through private-pay tuition, the federal government assists families that meet income and work/education requirements through the Child Care and Development Fund (CCDF). The Texas regular annual allotment is approximately $964 million. These resources are managed by the Texas Workforce Commission through the Child Care Services (CCS) program and administered by regional Workforce Development Boards.

To qualify, a family of four must have gross monthly income of $6,691 or less (85% of the state’s median income for a family of that size). Financial assistance is provided for approximately 140,000 children per day, which is about 12% of the entire licensed capacity of privately-operated programs. Families can choose any licensed child care provider with an agreement to serve CCS referrals, and about half of all regulated child care facilities participate in the program. However, only about 40% of the subsidized seats are certified for quality.

Unfortunately, there are approximately 95,000 Texas children on waiting lists for subsidized placements. The numbers are largest in the major population centers, but it’s a statewide issue. In some areas (known as child care deserts), the number of children younger than six with working parents is at least three times greater than the capacity of all licensed child care providers (subsidized or not) in the area.

Obviously, without adequate child care, many parents simply cannot work. When child care is extremely expensive, the incentives to remain in the labor force are greatly diminished. As labor shortages abound (there are presently more than 800,000 unfilled jobs in the state), the last thing we need is another obstacle for working parents. Texas has taken some tentative steps to improve the situation, but there is much more needed. Stay safe!