Federal Child Care Funding Cut Puts Working Moms at Risk
TL/DR –
During the pandemic, child care became a significant issue in the US, with many facilities shutting down due to a lack of funds, leaving working parents without the necessary child care. The American Rescue Plan Act provided $24 billion in child care stabilization funds, keeping over 200,000 child care providers operational, though these funds are due to be exhausted by the end of September. The article argues for further investment in child care, stating that the loss of these facilities could lead to job losses and economic setbacks, as many working mothers, who have seen their labor force participation rise to approximately 78%, rely on these services.
Minnesota Mom Struggles with Childcare Shortage
Minnesota native Claudia Swanson, who once worked as a social services case manager, experienced the hardships of the childcare shortage firsthand. Despite securing a spot early in her pregnancy in 2020, the daycare center her daughter was meant to attend shut down due to lack of funding. Swanson was forced to quit her job, nearly losing her house in the process. After six months, she managed to secure a daycare spot and restart her career, now operating a successful catering company.
Childcare Shortage Impacting Working Mothers
The sudden loss of childcare can lead to significant disruption and distress, making it challenging for parents, particularly women, to continue working. In 2021, the US government injected $24 billion into the childcare sector via the American Rescue Plan Act, which benefited over 200,000 childcare providers. However, this funding is set to end by September 30, potentially destabilizing the sector yet again.
Women’s Participation in Labor Market at Risk
Currently, women’s labor force participation is at a historical high, contributing significantly to the economic recovery. However, job losses due to the pandemic, school closures, and caregiving crises have meant that women’s contributions are morecritical than ever. This is particularly true for mothers of children under five, whose participation increased by 5% over the decade before the pandemic.
Childcare’s Role in Economic Recovery
The record-breaking participation of women in the workforce is not just a milestone, but an economic necessity. However, without extension of stabilization funds, the Century Foundation forecasts that 70,000 childcare facilities could close, affecting 3.2 million children. Childcare centers, like the one run by Minnesota’s Courtney Greiner, are struggling with high staff costs and low profit margins, making state and federal support crucial.
Threats to Childcare Provision
Continued funding cuts could lead to a reversal of recent gains in labor force participation. Already, parents have to contend with long waiting lists for childcare, and the sector’s workforce is 10% smaller than at the start of the pandemic. Mothers with young children face challenges in finding jobs due to childcare-related concerns, as shown in our analysis of data from the Census Bureau.
Impact of Telework and Childcare Issues
While telework has provided flexibility for some mothers, it cannot solve the childcare problem entirely. Two-thirds of working mothers with young children are unable to telework, and even those who can need childcare. Unless Congress extends the childcare stabilization funds by September 30, working parents and the economy could face significant consequences.
Childcare’s Role in Supporting Working Mothers
Our analysis (Figure 2) shows that half of all working mothers with young children rely on childcare facilities. However, just 6% of working mothers with young children telework while using only parental care. Since 2020, policy changes and labor market conditions have made it easier for mothers of young children to work. However, Congress must continue to invest in the workforce, particularly in childcare, to prevent a potential doubling of child poverty, as happened when the enhanced Child Tax Credit lapsed after 2021.
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