Free College or Free Child Care?

A recent article by Taryn Morrissey, Associate Professor of Public Administration and Policy, American University School of Public Affairs, notes that between 2014 and 2017, 35 states took up bills related to free college. While lawmakers also introduced legislation regarding childcare and preschool issues, one area that has not received sufficient attention is child care costs, given that—as many parents already know—the cost of high-quality child care and preschool can exceed the cost of college tuition in some areas.

A recent article from a Massachusetts newspaper reports that:

In 2016, the Economic Policy Institute reported early childcare expenses in Massachusetts exceed the cost for college. The think tank calculated the average annual cost for a 4-year-old totaled $12,781, which is nearly 20 percent more than the annual cost of in-state tuition for a four-year public college. The expense is likely contributing to the fact that 67,470—or about 30 percent—of preschool-age children in Massachusetts don’t currently receive any formal education, according to Strategies for Children.

A more in-depth look at this set of data from the Economic Policy Institute shows that the cost of a year of child care for a four-year-old equaled or exceeded the cost of one year’s in-state college tuition in 24 of the 50 states plus Washington, DC, and exceeded 10 percent of median family income in all but 9 states. Data from the Center for American Progress (2017) presents an even more dire situation, with that same average Massachusetts family facing a cost of $29,878 if it had both a four-year-old and an infant in child care. Thus, CAP reports, only 5 percent of three-year-olds and 32 percent of four-year-olds were enrolled in public preschool in 2016.

Professor Morrissey explains that the high cost of child care is not due to high child care teacher salaries, but rather to regulations that limit the number of children for which any one child care teacher can be responsible. In other words, there are no economies of scale for child care, and this raises its cost. Unfortunately, unlike with college, there is no loan or grant program for child care and preschool, and families often need these services when they are in their lowest earning years; as a consequence, lower-income families are less likely to enroll their children in child care programs, leading to a persistent academic achievement gap between lower- and higher-income children.

As a response to this challenge, it is true that many states are introducing universal pre-k or targeted pre-k programs for lower-income families but “what warrants much greater investment and policy attention is the gap between age 8 weeks—when parental leave ends—and ages 3 or 4, when preschool begins.” Not only is this an important period for child development, but when families cannot find child care, a parent must leave the workforce, which can cause significant losses to the economy.

Professor Morrissey recommends that at a minimum, there be an increase in child care subsidies, noting that “[t]he additional $2.9 billion for the Child Care and Development Block Grant program included in the recent budget deal is a great first step, and could serve an estimated 230,000 additional children in 2018.” More broadly, however, she recommends that policy makers look at investment in early childhood development as they would an investment in infrastructure. “Just like transportation, workers need child care to get to work”, and the investment in early childhood education will lead to a stronger workforce in the future.

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