Escalating child care costs force women out of the work force
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Escalating child care costs force women out of the work force
In the early days of COVID, millions of working mothers dropped out of the workforce to care for children and family members. But the hot job market of the late pandemic had them roaring back to work in record numbers. Now, it seems like the money might be catching up with them.
Right now, the average cost to enroll a child in a licensed daycare in the U.S. is more than $15,000 per year, per child. And now the impact on working families has started showing up in the data.
Amber Lord knew she wanted to keep working after she had her baby. She was in her late 30s and she had a career she loved in marketing. But when Lord and her husband started looking at daycares near their home in Virginia Beach, they ran into a problem:
“They were $25,000 a year,” Lord recalled. “And that was for four days a week.”
And even on those four days, daycare didn’t cover an eight-hour workday. Lord and her husband would need supplemental care on top of that. They sat down and did the math.
“We were like, ‘We can’t make this make sense,'” Lord said. “I would just be working 100% of the time to have my child in childcare 100% of the time.”
Lord’s husband was the bigger earner, but Lord’s paycheck was vital for their family: They needed her income to afford their mortgage.
“We might’ve lost our house. It was that bad,” she said.
Lord wasn’t able shift her position to part-time, which meant as soon as she had her baby, she would have to leave her job. The stress got so bad, Lord started to worry it was affecting her pregnancy.
“So I left,” she said. “I handed in my two weeks.”
Lord was terrified. She had just walked away from a job she loved and a career she’d spent nearly two decades building. Not to mention, her family’s money situation was now very shaky.
“I came home and I sat in a new house that we just bought.” she said. “I’m just sitting here crying, pregnant, and just feeling like: ‘There’s no village. There is no village. I live in a country where they don’t care.'”
The cost of preschool and daycare has risen by about 26% since 2019, according to the Bureau of Labor Statistics. Lord said it’s created a crisis: When she posted about her dilemma on TikTok, thousands of women wrote to her.
“So many other mothers told me it makes more sense financially for them to stay home and take care of the baby, and just live strapped on their husband’s paycheck,” she said.
Lord also hears from women who have had to keep working, but, because they couldn’t afford the childcare they wanted, were forced to leave their children in situations they didn’t always feel great about.
Lord says she hears these stories every day: about how the rising cost of childcare is forcing women to make really tough choices.
“You’re asking young families to spend a college tuition to have their child taken care of,” said Lauren Bauer, an economist with the Brookings Institution. “We give people 20 years to save up for college and we give them no time to save up for child care.”
Bauer said all of this is happening right after mothers had been entering the workforce in record numbers.
“The post-COVID environment was really good for women,” said Bauer. “We got this boost of additional child care funds, the boost of telework flexibility, the boost of a hot labor market and we are seeing all of those things dissipate.”
The money has definitely dissipated. The Biden administration’s $24 billion childcare subsidy expired last year. At the same time, the cooling job market has companies scaling back flexible work.
The result? The share of working mothers with children under five has dropped from nearly 71% last year, to 68%.
“That’s hundreds of thousands of women dropping out of the labor force in the past 18 months,” said Bauer.
Nobel prize winning economist Claudia Goldin has spent her career studying women, work and the labor market. She said the biggest thing any county can do to support women working is to lower childcare costs: “Every country that has highly subsidized child care has pretty high levels of female labor force participation,” said Goldin. “Sweden being a good example.”
Also, Canada, France and Germany have all seen women’s labor participation increase after government subsidies reduced childcare costs.
Back in Virginia Beach, a very pregnant and newly unemployed Amber Lord decided she would make her own job. She used her skills in social media and marketing to start a consulting business.
“I really went hard. So, I pretty much replaced my previous income within the first year, which, I know… I’m so lucky,” she said.
Lord has loved staying home with her baby, Henry. As she spoke with me, I could hear him laughing and babbling in the background. “He’s running around, chatty,” Lord laughed. Still, she said she wishes she could put him daycare part time.
“Because we just spend every waking moment together face to face,” said Lord. “Which is great, it’s very cool. I love him to pieces, he’s the best thing that’s ever happened to me. But … just to give me some free time,” she said.
Free time to work, to get different errands done, or just to rest.
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