The era of 9-5 child care is ending as parents' needs shift

By the numbers: 51% of U.S. parents say they'll spend over 20% of their income on child care this year —far more than the 7% that the federal government defines as "affordable" — according to a survey that Care.com provided first to Axios.

• In 2019, only 31% of parents said they'd spend that much.
• Higher costs are driving long-term changes in how and where child care takes place.

"It’s a huge sea change, it’s significant," Care.com CEO Tim Allen tells Axios. "Families are coming to look for child care that they can work into the new world order" of fluid work-from-home schedules.

• "They don't need the 9-5 nanny or 9-5 daycare anymore," he said. "They need two days a week, or they need someone to pick up the child from school and then stay for a couple of hours while they're at work."

UrbanSitter is seeing the same trends, plus a rise in families pooling resources for nanny shares — which became known during the pandemic as a "pod."

• More families are "trying to find a single care provider that they can guarantee a minimum number of hours a week but have some flexibility within that," UrbanSitter co-founder and CEO Lynn Perkins tells Axios.
• "Parents are saying, 'Hey, I need at least four afternoons a week in this time range, but I'm somewhat flexible," she added.

Driving the news: In its 9th-annual cost-of-care survey, Care.com found that weekly nanny rates rose 23% during the pandemic — to a national average of $694 for one child, up from $565 in 2019.

• At the same time, after-school babysitting rates rose 7%, to a national average of $261 a week.
• Child care center rates rose 5% to $226 a week — if you can find one with availability.
• "This is an economic issue not only for families but for all Americans," Allen told Axios. "With less disposable income to spend on other goods and services and more being deployed towards child care, families are just trying to make ends meet."

Yes, but: In-home child care and daycare centers are an out-of-reach luxury for many working Americans — particularly those who don't have the option of working from home.

• For them, patchwork care continues to be the norm — and their arrangements are often more tenuous than the babysitters typically hired online.

Between the lines: Rate increases are drawing more qualified sitters and nannies into the field: Former teachers, daycare workers, tutors, occupational therapists, etc.

• Their credentials are helping drive up babysitting fees even faster — which is good news for the providers, who have long been underpaid.
• As parents' needs shift, "you're starting to see more nannies who are picking up multiple jobs" to maximize their income — as well as families hiring more than one sitter for the week's coverage, Allen said.
• "So you're seeing multiple caregivers come into a household, versus it being a primary caregiver," he said.

By the numbers: Washington, D.C., is the most expensive place in the U.S. to hire a nanny, with an average weekly rate of $855, according to a Care.com survey of 3,003 adults conducted in March.

• The states with the next-highest rates are Washington ($840), Massachusetts ($834), California ($829), and Colorado ($763).

What's next: Care.com plans to propose legislation that would let families accrue up to $10,500 a year in pre-tax dollars for qualified dependent care — money they could carry from job to job and that wouldn't expire.

• The $10,500 contribution limit was included in the American Rescue Plan but not made permanent.
• It's more than double the amount allowed today under flexible spending accounts, which don't carry money over from one year to the next.