When it was passed in March, President Joe Biden’s American Rescue Plan included the single largest allocation for child care in the nation’s history: $39 billion. That’s more money than the United States has spent on child care in the past five years combined.
Combined with the billions in child care aid already included in earlier stimulus packages, states and tribes are looking at a degree of funding that could transform child care industries that have been neglected for decades, but they’ll have to do it with small departments and outdated systems. They will also have to focus on reaching people who have never qualified or been helped by child care dollars, a particular challenge that is beyond the scope of what agencies have done in the past.
“It is more money than the states have ever received for child care — multiples more than they’ve ever received before — and it is a big undertaking, especially if you are thinking about reaching more children, more families, more providers who may not have a relationship with the states at all,” said Mario Cardona, the chief of policy and practice at Child Care Aware, a national child care advocacy organization.
Because of ratios set by states and tribes around how much staff there needs to be per child — usually 1 adult for every 4 infants, about 1 to 8 for toddlers — the majority of expenses at child care centers are eaten up by payroll demands. But that workforce, in turn, is often paid little more than minimum wage because profits are so thin.
That’s why support for the workforce is key, something most states are prioritizing in the roll out of American Rescue Plan funds.
“There is no world where we have a system of high quality care that doesn’t fully invest in the workforce in the form of adequate compensation, in the form of paid family and medical leave, in the form of benefits,” said Cardona of Child Care Aware. “Unless you make those investments, you’re not going to see the kinds of returns that you want.”