No child care, no economic recovery

The column originally appeared in The Alpena News on August 19, 2020

Child care will be a major factor in Michigan’s post-COVID-19 economic recovery.

If small child care businesses cannot stay afloat, businesses will not be able to attract and keep workers, families with children will continue to suffer economically, and the need for public assistance and healthcare will grow — at the same time that state revenues are dropping.

Child care businesses have actually been riding the razor’s edge for some time. While the cost of child care can exceed a family’s rent or monthly mortgage and rival the cost of sending a young person to college, child care providers are some of the lowest paid workers in the state. Low wages and the lack of benefits make it hard for providers to recruit and retain highly skilled teachers, and force many early educators to rely on public assistance themselves as they struggle to pay their bills.

Making matters worse, few families have been eligible for child care subsidies because Michigan has one of the lowest income eligibility thresholds in the country. The number of low-wage workers receiving child care assistance fell 73% between 2003 and 2015, rising only marginally since. That decline is the result of state policies, not a reduction in need. The end result was the shameful failure to spend nearly $70 million in federal funding earmarked for Michigan for child care between 2014 and 2017 — by far the largest amount of unspent federal child care funding by any state during those years.

The COVID-19 public health crisis threw the fragile child care business into a tailspin.

Providers who were not caring for essential workers closed, and, although many child care providers were willing to take the risk of remaining open for parents who had to work outside the home, some parents were understandably uncomfortable taking the risk of exposing their children and themselves to an unknown and potentially deadly virus. Just over half of licensed child care providers in Michigan are now open, and most have very low enrollment, making it difficult for these businesses to get by.

So what can be done to avert the child care crisis? First, Michigan, like many other states, needs to reimagine child care. Now that there is growing consensus about the importance of child care — by Republicans, Democrats, business leaders and owners, advocates and parents — it is time to build a child care sector that works.

Among the elements of that reform are:

• A stronger focus on equity in recognition of the impact of racism on economic security in communities of color, as well as the high number of child care “deserts” in many rural communities. Michigan needs better data — disaggregated by race, income and geography — to help target child care resources.
• A workforce strategy that ensures that early educators can access the training they need, and are adequately compensated so child care is a viable employment option.
• The expansion of child care subsidies to more low-wage workers, beginning with an increase in eligibility for child care subsidies from 130% to 185% of poverty.
• Sufficient income for child care providers to stay in business, and funding to help families find safe, reliable, and high-quality care — especially for infants and toddlers, children with special needs, and parents who work evenings and/or weekends. Michigan needs to assess the true cost of child care and set realistic reimbursement rates that benefit all parents and kids.

The rebuilding of the state’s child care system will have a cost, but it is increasingly clear that there is a bigger cost to the economy and working families if Michigan does not take action.

In the long term, the state will need to tap into other federal, state, and, possibly, private resources to build a child care infrastructure that works for employers, families and children. In the short term, Michigan — like most other states — needs an infusion of federal assistance to weather the COVID-19 fallout and come back stronger.

The U.S. House included $7 billion for child care in the HEROES Act, and also passed the Child Care is Essential Act, which provides significant new resources. The U.S. Senate provided $15 billion for child care in the HEALS Act. Both the HEROES and HEALS Acts fall short of the anticipated need for child care funding of $50 billion nationwide.

The U.S. Senate and House will reconvene in September to work on any federal relief to states. During the next few weeks, when Michigan’s delegation is home, they need to hear from all of us about how important child care is to this state and its economy.

The need is urgent and the time is now.