While a significant part of the discussion happening in Montpelier right now centers on addressing the state’s housing crisis, it is only one piece of the puzzle that would eventually bring more folks to Vermont to live and work.
Working-class Vermonters will tell you child care is just as perplexing and challenging, not only because there do not appear to be enough facilities to meet demand, the cost of child care makes it prohibitive.
That puts strains on families in myriad ways. There may be family members able to work, but finding child care can — in some instances — negate the gains from having family members working.
According to the Economic Policy Institute, based on most recent data available, in Vermont:
— Vermont is ranked 16th out of 50 states and the District of Columbia for most expensive infant care.
— The average annual cost of infant care in Vermont is $12,812, or $1,068 per month. Infant care in Vermont costs just $3,291 (20.4%) less than in-state tuition for four-year public college. Infant care costs 9.3% more than average rent in Vermont.
— Infant care for one child would take up 18.3% of a median family’s income in Vermont. According to the U.S. Department of Health and Human Services, child care is affordable if it costs no more than 7% of a family’s income. By this standard, only 5.9% of Vermont families can afford infant care.
— Families with two children face an even larger burden. Child care for two children — an infant and a 4-year-old — costs $24,529. That’s 52.6% more than average rent in Vermont. A typical family in Vermont would have to spend 35.1% of its income on child care for an infant and a 4-year-old. Child care for a 4-year-old costs $11,717, or $976 each month. (The median family income in Vermont is $69,962. Infant care costs as a share of median family income top out at 18.3%, the institute warned.)
— Throw into the mix that a minimum-wage worker in Vermont would need to work full-time for 29 weeks, or from January to July, just to pay for child care for one infant, the institute reported.
— Nationally, child care workers’ families are more than twice as likely to live in poverty as other workers’ families (11.8% are in poverty compared with 5.8%). A median child care worker in Vermont would have to spend 46.4% of their earnings to put her own child in infant care.
Adam Grundy, a supervisory statistician in the Census Bureau’s Economic Management Division, released a national analysis this week that shows the rising cost of child care services in the United States “has created a challenge for many working parents: Should they keep paying for child care, adjust their work schedules to reduce expenses, or leave the workforce?”
The Census Bureau notes that government subsidies like the Credit for Child and Dependent Care are designed to assist parents with increased costs, but in recent years prices continued to rise, while the number of day care providers dropped amid the pandemic. That has been very true here in Vermont.
Between 2014 and 2021, estimated revenue of employer firms classified as Child Day Care Services increased all but one year — 2020, according to the U.S. Census Bureau’s Service Annual Survey.
The Census Bureau’s data shows the number of child care services businesses dropped from 2020 to 2021. There were 77,383 U.S. employer establishments with 875,114 paid employees during the pay period of March 12, 2021 — down from 77,629 employer establishments and 1,015,242 paid employees in 2020. It also shows that from 2019 to 2020, the number of child care services with no paid employees also went down. According to the the data, there were 517,983 U.S. non-employer firms with a total revenue of $8.5 billion in 2020, down from 564,700 non-employer firms with total revenue of $9.4 billion in 2019.
Ultimately, Grundy reports, the National Database of Childcare Prices, which reports child care costs in 2,360 U.S. counties, shows that child care expenses are untenable for families throughout the country and highlights the urgent need for greater federal investments, according to the U.S. Department of Labor. The database is the most comprehensive public federal source of child care prices at the county level.
Remarkably, Vermont is not the worst when it comes to child care expenses for preschool, infant care, and day care. The institute reports the top 10 are Washington, D.C. ($24,243); Massachusetts ($20,913); California ($16,945); Minnesota ($16,087); Connecticut ($15,501); New York ($15,394); Maryland ($15,335); Colorado ($15,325); Washington ($14,554) and Virginia ($14,063).
As we look to address the housing crises in Vermont, we need to simultaneously make child care a priority. We need to figure out a way, given the rising cost of child care, so that parents are not always looking for ways to make ends meet without leaving the workforce.
One idea put forth by the institute, is child care reform that caps families’ child care expenses at 7% of their income. That would save a typical Vermont family with an infant $7,610 on child care costs. And if child care were capped at 7% of income, 2,557 more parents would have the option to work, and the institute calculates it could expand Vermont’s economy by 0.7%, $241 million of new economic activity.
It’s an idea. We need ideas right now. We also know it requires loosening some regulations to allow more day cares and child care facilities in Vermont. But any idea feels better than the current situation, which is just hurting our state overall.
