The Current State of Childcare
The Issues
There is a very real need in our community for childcare, especially childcare that accepts children with disabilities. According to the Iowa Women’s Foundation, Scott County has already lost 38% of its childcare businesses over the past 5 years. In the past 10 years, childcare businesses have dropped by 60%. There are even fewer childcare businesses that take childcare assistance.
According to a report from Child Care Resource and Referral, Hand in Hand is only 1 of 15 centers that have a 4 or a 5 on the QRS rating scale, with five being the highest rating, which take childcare assistance. Programs that accept state childcare assistance in Iowa are down 34% in the past 5 years. This means that if parents want quality care, they have truly little choice in who will accept their child. Parents have even less of a choice when it comes to childcare centers that specialize in caring for children with a disability.
Ready Nation reported that 50% of working parents they surveyed struggled with childcare. Sixty percent of parents cited lack of childcare as their reason for leaving the workforce and over 1 million fewer women are in the workforce than before the pandemic. Another article from the First Five Years Fund stated, “51% of parents say they spend more than 20% of their household income on childcare, and 72% of parents report spending 10% or more. This is up from 70%, according to data from 2019.” Ready Nation reported that parents biggest childcare challenges were finding affordable, high quality, convenient care that had open slots.
Lack of childcare is not just an issue for families. It is an issue for our workforce and our economy. The Iowa Women’s Foundation states that annually, childcare issues result in an estimated $935 million loss for Iowa’s economy. Absences and employee turnover cost Iowa employers an estimated $781 million per year. Working parents miss an average of 4.3 days of work every six months and are late to work or leave early an average of 7.5 times.
According to a report from Ready Nation, in Illinois insufficient childcare costs businesses $559 million each year. The report also said that businesses lose revenue from lower outputs and incur extra costs to rehire and cover absenteeism and to manage disrupted work. Taxpayers also lose money from a lower GDP and lost sales and consumption tax revenue.
What Can We Do?
The Iowa Women’s Foundation offers several solutions to help with the childcare crisis.
Employers can offer flexible work arrangements that allow remote work, flexible hours, and generous paid time off, and predictable schedules.
Businesses can offer a flexible spending account for their employees. FSA are a pre-tax benefit account available as part of a benefits package at a company. An FSA can be used to pay up to $5,000 for eligible dependent care services, such as childcare.
Subsidize childcare by reimbursing or subsidizing employees’ costs.
If employers are able, they can offer on-site childcare.
Learn More About the Issue
First Five Years Fund, Over Half of Families are Spending More Than 20% of Income on Child Care
Iowa Childcare Resource and Referral , Online Referral System
Q2030 Business Forum, Childcare as a Workforce Solution Presentation (including information from the Iowa Women’s Foundation and Ready Nation
Ready Nation, Strengthen Child Care, Grow Illinois’ Economy
Iowa Women’s Foundation, Iowa Business and Child Care Toolkit