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Over the last two and a half years, the COVID-19 pandemic put a spotlight on the importance of childcare to the U.S. economy.
Throughout the pandemic, stressed-out families struggled to find reliable childcare as many providers shut down abruptly due to COVID exposures. This forced many parents and caretakers to take unplanned leave, attempt to work and care for children simultaneously, or to leave the workforce altogether. Recent research from the U.S. Chamber of Commerce Foundation estimates that as many as 40% of parents have had job decisions significantly affected by childcare issues, while gaps in care result in hundreds of millions of dollars in lost economic productivity in each state each year.
Childcare is an industry that has long faced economic challenges. Many providers must survive on profit margins under 1%, even as the average family with young children pays more than 13% of income to childcare costs. And the difficult business model of childcare offers few solutions for the industry’s most significant challenge: hiring, retaining, and paying good wages to early educators.