More child care spots open, but they're pricey
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Parents might have an easier time finding a child care spot in Minnesota, but it's likely to cost more.
The big picture: The state's child care shortage has improved in recent years, according to a new Minneapolis Federal Reserve Bank study. But high costs can still be an economic drain on Minnesota, as they could force some parents to stay home with the kids.
By the numbers: Minnesota saw a 3% decline in the number of child care slots between 2019 and 2023, but demand fell by nearly 8% over that same time, which means there's less competition for parents.
- The study found that capacity is higher in metro areas compared to rural areas, where the shortage is more acute.
Between the lines: The data shows there's a shrinking number of kids with working parents — and an overall decline in kids 5 and under in Minnesota.
The intrigue: Minnesota continues to lose in-home day care providers, and that capacity is being absorbed by more expensive child care centers.
- The average cost for infant care at a metro area in-home provider is $226 a week compared to $451 a week at a center, according to Child Care Aware of Minnesota.
Catch up quick: More than 4,000 in-home providers in the state — about 40% — have closed in the last decade, according to MPR News.
- Those providers say rising costs for supplies, food and insurance, plus burdensome state regulations, have made doing business too difficult.
The bottom line: "Without access to affordable care, it's much harder for parents to participate fully in the labor force, affecting family income and employers struggling with hiring," the Fed's Tu-Uyen Tran wrote.