Dec 3, 2021 - News

Lack of child care costs Texas billions

Image of paper cut family, with the child in the middle made of a dollar bill.
Illustration: Maura Losch/Axios

A dearth of affordable child care is putting a dent in the Texas economy.

Driving the news: Parents are missing work or leaving jobs to take care of kids in a landscape pockmarked by the pandemic and labor shortages, per fresh research by the U.S. Chamber of Commerce Foundation.

The big picture: Even as Texas — and Austin especially — is attracting new businesses, finding and affording child care is shaping up to be a critical issue for parents as they navigate a return to working away from home.

Context: Relatively low wages, high rents driving child care workers further from Austin and ripple effects of the pandemic have led to crippling staff shortages and enrollment caps, day care operators report.

What they're saying: "Without suitable childcare options, many Texans will be forced to exit the workforce," the chamber's researchers found. This "has negative financial impacts on their household and limits the talent pool available to businesses in an already competitive labor environment."

At Sammy's House, an Austin child care center that caters especially to kids with special needs, enrollment has been cut by 50% because of staffing shortages, executive director Isabel Huerta tells Axios.

  • She says she is going to need to raise fees to keep up with fixed costs.
  • "What's scaring me is that child care will start to serve only the affluent. The cost of child care is going to go up and become unaffordable," Huerta said. "When child care options start disappearing, I don't know how they're going to work."

By the numbers: Child care issues result in an estimated $9.39 billion annual loss for Texas' economy, per the chamber research.

  • As much as $1.8 billion is lost annually in tax revenue due to child care challenges; absences and employee turnover cost Texas employers an estimated $7.59 billion per year.
  • Almost three quarters of parents (74%) reported missing work due to child care issues in the past three months.
  • Approximately 7% of parents voluntarily left a job due to child care hiccups.

The U.S. House version of the Biden administration's Build Back Better Act provides child care subsidies covering roughly 20 million children.

  • At the state level, Texas lawmakers this year opted to increase state reimbursements for child care providers — but decided not to establish a statewide study to understand the true cost of quality child care.
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