States taking the boldest actions on child care should be national models

States taking the boldest actions on child care should be national models
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Our country is facing a workforce crisis. There are 9.2 million unfilled jobs, and as a result, too many businesses can’t grow, compete, and thrive. A critical barrier standing in the way of Americans getting back to work is child care.

An estimated 700,000 parents with young children left the labor force in 2020 as child care centers shuttered across the country during the pandemic. At the height of the pandemic, 75 percent of working parents had children under six at home, while just 10 percent of working parents were using child care centers. The U.S. Chamber of Commerce Foundation found that 58 percent of parents who left the workforce did so because they could not find child care.

As the country faces a worker shortage crisis, nearly one in four unemployed Americans cited child care and other family needs as a factor in why they are not actively looking for work, according to a U.S. Chamber poll.

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While the pandemic has shined a spotlight on how critical child care is to the business community and economy, even prior to the pandemic a U.S. Chamber Foundation study found that in Idaho, Mississippi, Pennsylvania and Iowa, breakdowns in child care systems cost those states an average of $1 billion annually.

As states look for solutions, the federal government has sent states an unprecedented amount of funding to address the economic impact of the pandemic — including $52.5 billion for child care from the CARES Act, the December 2020 relief package and the American Rescue Plan Act. In 2020, $13.5 billion in emergency funds for child care was issued, followed by the American Rescue Plan Act, which allocated $15 billion in supplemental Child Care Development Fund dollars, and $24 billion in stabilization grants. All told, the American Rescue Plan Act sent states a total of $195 billion in funding to combat the pandemic.

We have an opportunity now to shore up this industry, boost the child care workforce, and support parents who want and need to work. As governors consider how best to use stimulus dollars, jumpstarting the child care sector is key to providing a spark in local and regional economies.

Child care is a workforce issue, and prioritizing investment in the following ways will help to overcome this barrier:

  • Investments in the child care workforce. In the short term, states can offer incentives such as signing bonuses for child care workers to return to work, and retention bonuses for established early childhood educators. In the long term, continued education grants and apprenticeship programs to support early childhood educators can meet the incredible demand for quality child care. 
  • Supporting working parents. States can and should invest in their data infrastructure. By creating databases that monitor the type and supply of child care available to communities, families and child care providers both benefit.
  • Investing in the business side of child care. Stabilizing and growing the child care industry is a must. Grant and loan programs to stabilize existing child care programs and launch new, quality options will prevent child care deserts from growing, promote innovation from providers, and increase options for families.

Many states are already leading by example. 

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Arizona channeled $300 million in federal resources into return-to-work incentive programs that include $2,000 bonuses for those who return to the workforce, three months of child care assistance for people with children who return to work after collecting unemployment benefits, and housing assistance.

In Delaware, an early education and child care stabilization fund was created to help early child care professionals stay in business, while New Hampshire plans to use American Rescue Plan funds to launch stabilization grants and fund workforce recruitment efforts and scholarship programs.

Georgia has offered a one-time bonus to reward quality child care professionals and help offset lost wages, and is eliminating copays for families who receive a state child care subsidy. Michigan announced a $1.4 billion child care program with nearly $650 million directed at child care businesses to help them open their doors again.

In Oklahoma, federal relief dollars are being directed to programs offering 60 days of subsidized child care for anyone unemployed due to COVID and actively looking to rejoin the workforce, and coverage of subsidy copayments for families, paid directly to providers. 

This unprecedented public health crisis has illuminated what early childhood educators and working parents have known for years — child care is the profession that makes all others possible. There is now a remarkable opportunity to reexamine, rebuild and reinvest in this essential industry. By prioritizing and investing in child care, governors can ensure they have the necessary workforce of today — and tomorrow — to support their states, families and economies.

Cheryl Oldham is vice president of education policy at the U.S. Chamber of Commerce and senior vice president of the Center for Education and Workforce at the U.S. Chamber of Commerce Foundation.