Seventy (70) percent of publicly funded childcare centers in Louisiana were closed on May 1, 2020 (Louisiana Policy Institute for Children, 2020). Many of them will be unable to reopen.
The further erosion of a resource that was already in short supply has created an economic crisis. Just ask any working parent.
Just ask the employers of working parents.
Childcare has long been a silent economic engine – providing the essential infrastructure for parents to work or to receive job training or other education. Childcare contributes directly to both household and business bottom lines; and without it, both families and businesses are economically handicapped.
We know that many childcare centers will close due to the very narrow margins that have always existed between operational income and expense. Even prior to COVID19, Louisiana was only serving 15% of children who were eligible for childcare assistance funding – the engine has always needed fixing, and the previous shortage has now been magnified.
The demand for childcare now far exceeds supply – creating a different type of contagious pandemic. None of us can work effectively or receive the services we need without the labor-force participation of working parents. Working parents are essential to every single occupational sector.
As with any crisis, distress forces change. The distress created by an inadequate childcare system will now be felt by many more of us than ever before. It will result in creative solutions because of two realities:
- To restart Louisiana’s economy, parents must get back to work.
- Childcare is essential to accomplish this.
Clearly, we all have a stake in solving this problem.
We can look to history for solutions. When women were needed in the WWII manufacturing workforce, childcare was quickly established and subsidized with federal funds, many times right on the manufacturing site. The positive outcomes are worth our attention: the children in these centers were more likely to be employed, have higher earnings, and need less public assistance as adults. Further, these benefits were most likely to be accrued by the most economically disadvantaged families.
The lesson learned? An investment in quality childcare can benefit not only the business and its current workforce, but also the children – our future workforce.
Given our current conditions with resources in short supply, what can we do? There are several opportunities.
Like the WWII model, a current solution might be made possible by in-kind contributions of the second largest expense item in a childcare center’s budget: space.
We can all see that empty space is something our community has in excess and aligning excess resources with critical shortages could solve two problems. Many businesses and government entities own unused space that might be re-purposed for the provision of quality childcare. And there are many childcare providers have the expertise to provide the programming.
Another opportunity lies with Louisiana’s School Readiness Tax Credits. These tax credits allow Louisiana businesses to make subsidized contributions to childcare centers on behalf of their employees and receive tax credits on up to 20% of the contribution. Additionally, businesses can contribute up to $5,000 to Child Care Resource and Referral Agencies and receive a 100% dollar-for-dollar tax credit in return.
How do we get the economic engine of childcare repaired and running? Understanding the needs of both working parents and business owners is the first step.
Ultimately, meeting the demand for childcare will require nothing less than public-private partnerships. Neither group has all the resources that are needed. Yet together we can create powerful solutions that will positively impact the bottom lines of both businesses and families.
This vision of a thriving community is within our reach and it comes as no surprise that children are the key.
If you are concerned about the economic crisis created by the childcare shortage, we invite you to join the Step Forward partnership. Your help is needed to develop solutions to care for our children and plan for a greater future. To get involved, contact Laura Alderman firstname.lastname@example.org.
Laura Alderman is Executive Director of Step Forward, a nonprofit partnership working to ensure success for every child, from cradle to career.