Let’s start with numbers: Annual lost revenue due to a lack of childcare amounts to a national average of $6.9 billion in taxes, $12.7 billion for businesses, and $36.9 billion for individuals. For states, this loss comes to a $2.7 billion total economic hit — $528 million from tax-based lost revenue and $2 billion for employers due to employed-parent turnover and sick days. The entirety of this lost revenue can be linked to unavailable or inaccessible childcare.
No parent should be denied the opportunity to make an income for their families due to a lack of childcare. And our economy could clearly do without the added strain. If you agree, keep reading. We’ll dive into some of the best solutions and make a plan to move forward together in the post below.
As mentioned above, lost revenue due to childcare has two root causes. The first of which is parents who leave the workforce and cannot return, either ever or for an extended period of time, due to not having proper care for their child(ren).
And in the majority of circumstances, this has nothing to do with a lack of effort. It may be caused by underpaid employees, a lack of childcare in the workers’ area, or recurrent childhood illnesses.
Let’s look at a few examples to get the full picture:
Each of these scenarios is all too common in our economy today. Statistics show that 27% of families who desire childcare have difficulty finding a spot. Rising care costs have led to a direct 13% drop in employed mothers. And 52% of the US’s working parents rely on the uncommon luxury of unpaid care.
Providing mothers with opportunities to stay in or rejoin the workforce has been talked about for decades. Local and larger governments have attempted to make this possible through minimum wage increases and childcare assistance programs. Businesses have attempted to recreate post-WWII benefits packages to accommodate the fact that homebound wives are no longer the expected form of childcare.
Though each of these efforts is helpful, they’re not enough. They’re not getting down to the root cause of mothers and fathers unwillingly leaving the workforce. Therefore, they’re not solving the issue of lost revenue on every level.
What is the simplest way to reverse lost revenue by allowing more parents to enter the workforce? Create an abundance of affordable and high-quality childcare seats in the communities that need them (which is everywhere, if we’re being honest).
By increasing available and cost-effective childcare, we can eliminate the main reason that parents leave the workforce. We can build successful in-home daycares and preschools, adding those to the economy at the same time. We can boost the next generation of employees and business owners through early childhood education, increased social skills, and access to age-appropriate curriculum.
At Wonderschool, this type of work is exactly what we focus on. We build a pipeline of attainable in-home childcares through one-on-one business support, curriculum development, and a nationwide marketplace. Our goal is to help every career-driven parent attain quality care for their child. With your help, we can make a mark on that childcare-related lost revenue, too.
Contact us today, or simply click through our information on government partnerships. We’re looking forward to positively impacting the lives of kids and parents, as well as stimulating your local economy, together.
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Joins us as we explore how home-based program creation can play a critical role in the success of the Child Care Chips Act.
Read about the connection between lost revenue and childcare, how it effects individuals, and how that impact magnifies into the broader economy.