From the March 2015 issue

The Sad State of Child Care

Elizabeth Knight of West Bloomfield always thought that when she started a family with her husband Christian, she’d become a stay-at-home mom like her own mother had been. When her son Lucas, now 3, was born, Knight realized that was not to be her life path.

“It turned out that what I thought I wanted didn’t fit for me when it came to that point,” says Knight, who works full-time in insurance claims.

Still, it wasn’t easy deciding in whose care to leave her 6-week-old son upon her return to work. Her husband also works full time, and neither set of grandparents was an option. Knight and her husband eventually decided on a child care center between their home and Elizabeth’s office. While the Knights are secure in the decision they’ve made for their son, the high quality of his care comes at a cost.

The couple has intentionally spaced out their children, so that they wouldn’t be in the position of having an infant and a toddler in daycare for more than a year. Now expecting her second child, Knight is nervous about the expense of two children in full-time daycare – but knows it is only for one year before Lucas enters kindergarten.

“I would have loved to have had my kids two years apart,” Knight notes. “But when we started talking about the financial component, we had to discuss how long we could carry the cost of two kids in daycare.”

Cost and benefit

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In the United States, 11 million children age 5 and under are in some form of daycare for an average of 36 hours a week, according to Child Care Aware of America, a nonprofit national advocacy organization that serves as the central hub for the more than 600 state and local child care resource and referral agencies nationwide.

In its recently released annual report Parents and the High Cost of Child Care, Child Care Aware details the significant expense that child care represents for families. The report reveals that the cost in many states, including Michigan, full-time infant care surpasses the cost for tuition and fees at many public colleges. Additionally, the expense of full-time child care exceeds the cost of food, housing and transportation in the family budget.

For parents of two children, full-time child care is the highest single household expense in the Northeast, Midwest and South, according to the report. In Michigan, average annual fees for care in a center-based setting are $9,724 for an infant and $7,956 for a 4-year-old child. The cost is less for full-time care in a family child care home, where annual fees are $6,656 for an infant and $6,448 for a 4-year-old child. Yet, according to Child Care Aware, the stiff price tag offers no guarantee of quality.

“The high cost of child care does not necessarily correlate to high quality of care,” says Michelle Noth McCready, Child Care Aware’s deputy chief of policy. “The high cost can be attributed to a number of factors including cost of living and the cost of operating a small business in that particular area.”

Quality is crucial when you consider the importance the first three years of a child’s life hold for crucial brain development. The largest ever study of the effects of child care was conducted over 15 years by the National Institute of Child Health and Development (NICHD) and found that children who received the highest quality care in the first few years of life scored higher in measures of academic and cognitive achievement when they were 15 years old. Even 10 years after children left child care settings, experiences in quality settings were still related to higher academic achievement.

The NICHD study showed that high-quality caregiving is linked to better cognitive development, more advanced speech and understanding of language, and more advanced social skills than children in mediocre care. The reverse is true for children in poor quality care, especially among children who are underprivileged in other ways.

With such high stakes, “quality” has become the buzzword among policymakers and those whose job it is to ensure that children are receiving optimal care.

“Quality is about highly trained, highly educated staff, a safe and healthy environment, use of a comprehensive curriculum that includes all components of child development, comprehensive assessment every year, family engagement, community connections,” says Sheri Butters, director of Michigan’s Great Start to Quality at the Early Childhood Investment Corporation. “All of these come into play.”

At a macro level, the benefits of high-quality child care also pay dividends well into the future. In a 2012 speech at the Children’s Defense Fund National Conference, economist and former Federal Reserve Board chairman Ben Bernanke cited a growing body of research indicating that quality early childhood programs have long-term repercussions particularly for children from “disadvantaged environments.” Children who experienced high-quality child care were more likely to own their own homes at age 40. He went on to say that early childhood experiences set children up to succeed in school and contribute to society as adults. Conversely, those children without such experiences are more likely to drop out of school, earn lower wages, depend on government assistance or be incarcerated.

Federal involvement

President Obama’s recent State of the Union address called for our nation to stop treating child care as a “side issue” – and said that it’s high time we treat it as “the national economic priority that it is for all of us.” It will be interesting to see if his words spark some action in making child care more assessable and affordable.

Because despite the importance of quality, affordable child care to families and society at large, child care hasn’t been a federal priority in the United States since World War II, when women entered the workplace en masse to meet the production demand for wartime goods. With the need for federal child care then perceived as an issue of national security, in 1940, Congress passed the Lanham Act, which led to the development of a network of government-run child care centers eventually serving more than 100,000 children.

The Lanham Act lapsed after the war and subsequent efforts at a federally backed child care system failed to gain real momentum in the United States. One exception is the creation of the Head Start program in the 1960s, which benefits children from low-income families. Child care subsidies for very low-income families have been the only other consistent federal involvement. The Child Care and Development Block Grant (CCDBG) assists low-income families and those receiving public assistance in obtaining child care. In Michigan, those funds are administered by the state’s Office of Child Development and Care as part of the Child Development and Care (CDC) program and are available to residents whose monthly income is below a certain threshold.

“A family of two (parent and a child, for example) may gross a monthly income of $1,607 to be eligible for the subsidy,” says Lisa Brewer-Walraven, director of the Michigan Office of Child Development and Care. “Any more than that, and the family would not qualify for the subsidy.”

To be eligible, parents must demonstrate they need care to enable their employment, high school completion, family preservation or participation in another approved activity. The state provides a comprehensive income-eligibility chart on its human services department’s website.

“As long as a family has a need for child care and meets program criteria, they can take advantage of subsidy funds for children from birth through age 12,” Brewer-Walraven says. “At a child’s 13th birthday, he or she is no longer eligible. There are some exceptions where we can go up to 18. For example, if medical reasons come into play.”

How we stack up

In her book Child Care Today, noted early childhood advocate Penelope Leach writes, “The United States is unique among Western countries in having no federally mandated paid maternity or paternity leave, and its programs to assist poor parents with child care fees are underfunded.”

Leach points to Finland as a gold standard for a federal child care program. In Finland, generous paid leave policies enable many parents to stay home with an infant or toddler. Plus, child care is free (funded by taxes) and available to all families.

Another national child care system lauded by early childhood researchers is that of France, where state-run daycare centers are subsidized by the government on a sliding scale based on income. The country’s free universal public preschool, known as “école maternelle,” is a cherished feature of the country’s education system. It enables all 3-, 4- and 5-year-olds free access to a high-quality preschool program with highly trained staff to ensure all children begin first grade on equal footing.

According to Leach, somewhere in between the United States on one end and France and Finland on the other is the UK, where parents are responsible for the cost of child care, but employed moms can enjoy up to nine months of paid maternity leave. Also, 3- and 4-year-olds can attend free half-time preschool.

One segment of the U.S. population that does have access to subsidized high-quality child care that is flexible, highly regulated and will accept infants a mere 4 weeks of age is active duty military.

“Most people are quite surprised to learn that the Department of Defense (DoD) runs the largest employer-sponsored child development system in the U.S.,” says Barbara Thompson, director of the Office of Family Policy/Children & Youth, Office of the Deputy Under Secretary of Defense. “We oversee care for 200,000 children a day who range in age from 4 weeks to 12 years. We oversee 800 child development centers and 4,000 family child care home providers.”

Military child care is widely recognized for its quality, certification and inspection processes – and incentives to retain and grow staff. “We consider child care a workforce issue, not a social service,” explains Thompson, who has worked in the field since 1983. “Our members move every two to three years. We need a system where, when they move, they receive comparable care. We are proud of our consistency.”

Safety and quality

The reputation of military child care has not always been so glowing. In fact, a fall 2013 Future of Children research report noted that in the early 1980s, DoD child care programs were found to be lackluster in many ways – including their adherence to fire and safety codes, inconsistent inspections and inadequate staff training and pay. Lengthy wait lists and the high cost of care were other hurdles making child care unattainable for many in the military at that time.

Congress eventually passed the Military Child Care Act of 1989, which represented a crucial turning point in the DoD’s approach to care. The funds Congress appropriates for military child care centers must equal or exceed the amount parents pay in fees, and those fees are based on total family income.

“This means that junior rank families who earn an annual salary of less than $29,000 pay $50 a week for care regardless of the age of their child,” Thompson explains.

This is a departure from child care in the civilian world, where the cost of infant care is often significantly higher than toddler care. Other features setting military child care apart include a dedicated “training and curriculum specialist” at each of the military’s 800 child development centers.

“The T&C specialist is there to ensure developmentally appropriate programming,” Thompson says. “This person is required to have a bachelor’s degree in early childhood or early education. He or she observes and mentors staff and reviews lesson plans. They have been one of the linchpins of our success.”

Another area where the DoD’s child care program outpaces care in the civilian realm is inspection. In Michigan, for example, licensed child care centers and group homes can expect an onsite inspection every year. (Every two years, a license renewal inspection is conducted. An interim inspection takes place in the off year.) Military child development centers and family child care homes are inspected four times a year – once by higher headquarters and three times by the individual service arm.

Staffing is vital

Staff turnover at military child development centers is kept at bay in part due to a robust training program.

“Our staff can enter the system with a high school degree or GED,” she explains. “After that, it’s up or out, meaning that staff must continue to meet competency milestones for which they receive a commensurate raise in salary. Their status is transferrable from base to base. When our caregivers stay in the system, they have opportunities for advancement.”

It is staff wages that contribute to many of the challenges commonplace in the civilian child care sector. According to Child Care Aware of America, child care professionals make up one of the lowest-paid professions, with the average income of a full-time child care provider being $21,490 in 2013. Overhead expenses in child care programs account for a majority of the expense, meaning most child care providers make little more than minimum wage.

“Child care is labor intensive,” notes McCready. “The low child-to-caregiver ratio required to meet licensing standards means providers need more staff. Salaries are what the market can afford. Child care really is a break-even business.”

Aleta Martin is a mother of three and a long-time child care provider. She worked for more than 10 years at a Southfield-based child care center that her children also attended. She recently relocated to Washington, D.C. to take on a similar role in a child care center – but one in which she is making three times what she was in metro Detroit.

“I’ll be in D.C. indefinitely unless I am offered a better-paying opportunity back home,” says Martin, who is simultaneously pursuing her master’s degree in education and hopes to work for the U.S. Department of Education upon graduation. “I’ve worked the front line of child care. I want to help shape policy in this area. Child care needs to be further subsidized. For many people, the cost of child care is more than their rent or mortgage.”

Michigan’s child care subsidy

In 2014, 24,000 Michigan families took advantage of a child care subsidy available through the state’s Child Development and Care (CDC) Program. It’s funded by the federal Child Care Development Block Grant (CCDBG) to help low-income families. The grant also helps fund various child care quality initiatives.

Lisa Brewer-Walraven, director of the CDC office, says that figure is down from 75,000 families when she first started with the program in 2005. “Our case loads are going down,” she says. “It’s a phenomenon going on across the nation, not just in Michigan. We do think the economy plays a big role.”
It’s the Office of Child Development and Care’s goal to increase the number of families taking advantage of the subsidy.

“Possible barriers preventing families from applying for the subsidy are that they don’t know or understand the eligibility criteria,” she says. “They might not know how to apply. We want people to know they can fill out an application in a Department of Human Services (DHS) local office.”

While the state is working on an awareness campaign to promote the subsidy to families who may need it, Brewer-Walraven considers child care providers to be the program’s biggest advocates, as they are on the front line with families who may be struggling.

The CDC subsidy typically does not cover the entire cost of child care. Parents are responsible for the difference, and not all providers accept the CDC subsidy. From the time a parent submits a CDC application, it typically takes 45 days to find out whether they’ve been approved.

“If the parent chooses a child care provider licensed or registered by the state, the provider can bill for services every two weeks,” Brewer-Walraven explains. “The check is sent directly to the provider. If the family is working with an unlicensed provider (i.e. a family, friend or neighbor) enrolled by the department in the CDC program, a check is sent to the parent who then pays the provider.”

Find more on the Michigan Department of Human Services website.

Illustration by Melanie Demmer

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