Without child care, the economy cannot thrive
“It is high time we treated child care for what it is – something whose contribution to economic growth is as essential as infrastructure or energy.
This is how United States Secretary of the Treasury Janet Yellen put it in a recent report that details how our current child care system fails to adequately serve families. I couldn’t agree more.
We know that child care providers are heroes. As a parent of a third grader, a longtime advocate for children and families, and the daughter of a single mother, I have seen firsthand how your child care provider becomes a partner in early years. years of your child, providing supervision, basic education and social experiences and empowering the workforce our employers need.
When the pandemic struck, child care providers stepped up to keep frontline workers in business. Our hospitals and health systems have told us that a third or more of their staff depend on access to child care. It is no exaggeration to say that access to child care made the difference between life and death for their patients.
But the way the child care industry operates now puts parents and providers in a difficult position. On average, childcare costs can consume up to 13% of the total income of families with children under 5, according to the Treasury report – at a time when parents can least afford it. For low-income families in Greater Minnesota, the barriers to access and affordability are even greater, with parents walking significant distances or separating their children to find an available niche.
Families must choose between bearing these high costs or having a family member leaving the labor market entirely to care for the children. For single parents, there is no choice at all.
For providers, income comes mainly directly from families. Raising costs means raising prices; trying to keep costs low means low wages for a workforce that is overwhelmingly made up of disproportionately women and people of color. Staff in turn must choose between a future of low wages for skilled and demanding work or leave the field altogether, creating a staffing crisis that is only exasperated by worker shortages across our economy and leading to theaters. closed classes or at reduced hours. No one wins in this cycle.
The reality is that our economy cannot function without child care. That’s why Governor Tim Walz and I have leveraged public funding and private partnerships to support families and the child care industry during the COVID-19 pandemic. This included prioritizing more than $ 300 million in early-stage investments to invest in supporting public health costs, access to child care, increasing child care assistance rates. and new business supports. Support continues with approximately $ 535 million in investments in child care from the American Rescue Plan, of which $ 300 million goes towards stabilization grants for child care.
Our long-term economic recovery is based on finding long-term solutions. As we engage with employers across the state, access to child care services frequently emerges as one of the primary needs to address labor shortages and skills gaps that employers are confronted. Earlier this month, our administration announced the Governor’s Council on Economic Expansion. When we talk about economic opportunities, I want us to think broadly and creatively – and that means access to child care.
But we cannot solve this problem on our own. Federal investments that ensure low- and middle-income families can afford child care, as well as preschool investments that strengthen our blended child care, school and home child care delivery system are investments that we cannot afford not to manufacture. In addition, paid family leave and the continued expansion of the Child Tax Credit help support working parents, reduce poverty and ensure all children thrive. These proposals – and more – are all part of the debate over the budget reconciliation bill that is making its way through Congress.
I know President Joe Biden and Vice President Kamala Harris, as well as strong congressional advocates like Senator Tina Smith, understand the importance of child care, and I am delighted that Secretary of the Treasury Yellen is doing clearly the link between child care and our country’s economic well-being. Minnesota is ready to partner with the federal government, child care providers, employers and families to build the child care system we need. Now Congress must act on these realities.
Peggy Flanagan is the Lieutenant Governor of Minnesota.