Without ARPA funding – A crisis is coming in the childcare industry.
By: Diana Bello Aristizábal
Ninety percent of a child’s brain develops during the first five years of life, time span that typically matches with the years of attending a childcare facility. Despite this, historically, these centers have not received the appropriate resources to provide a high-quality service, up until 2021, when the industry was granted $24 billion of federal support through the American Rescue Plan Act (ARPA). This program expired at the end of September.
The cancellation of this program, which for a little more than two years helped it keep afloat, would be a hard hit for the owners of subsidized childcare centers, as well as for childcare workers, the families who depend on them, and ultimately, for the country’s economy.
“The years children spend in childcare centers set the stage for their success later in life. That’s why we need to make sure they are ready to enter Kindergarten,” says Rachel Spector, Director of Programs at The Children’s Trust, who explains that ARPA funds were intended to stabilize an already broken system and improve the quality of the service provided.
It represented the largest investment for the industry in history, making possible at the time to keep more programs open, increase wages for childcare workers, offer them more benefits and safety against COVID-19, in addition to improving the conditions of the facilities and tuition fees.
It was a completely necessary aide in the midst of the crisis brought on by the pandemic that required the services of nurses, policemen, firefighters, and health workers more than ever. Many of them had children, and being able to leave them in good hands while going to work was imperative.
What’s coming now?
Given everything that the capital injection received in 2021 meant, its absence could bring a crisis that goes far beyond the system itself. Childcare centers that are unable to find additional funds to operate could end up closing. Also, salaries would decrease, tuition costs would increase, as well as workers’ resignation and laid off, impacting the quality of service.
“All children should have access to high-quality care, but if workers are not well compensated, these centers won’t be able to provide the best service, just as when you walk into a store where you know you will be treated properly if the employees are happy and adequately paid,” Spector says.
This scenario could bring serious consequences for the economy because if there aren’t enough childcare programs available, parents and caregivers would have to make hard decisions such as cutting their work hours or leaving the labor market. With fewer people earning an income, less money would be spent in goods and services.
Judging by a recent report from the Florida Chamber of Commerce, there is already a problem. According to their statistics, Florida misses $911 million annually in tax revenue due to the childcare crisis, while 64% of parents of young children missed work or class at least once in the past three months for childcare-related reasons, and 15% left a job in the past six months due to childcare issues.
On the other hand, an increase in tuition fees would affect families who don’t qualify for a subsidy. “It will be very difficult for childcare centers to raise their costs because people simply cannot afford them. Currently, about half of families are spending up to 20% of their salary on childcare services,” Spector states.
A light on the road
Although the picture doesn’t seem encouraging, there are resources available. The Children’s Trust leads the ‘Thrive 5’ initiative through which it invests money into childcare programs, offers scholarships to families that aren’t qualified for subsidies, and rewards teachers for their retention, among many other actions.
In addition, at the legislative level, an attempt is being made to increase the income threshold to qualify for the ‘School Readiness’ program subsidy for families, although it is still necessary to work on salary parity between early education workers and K-12 schoolteachers.
On the county’s part, efforts are also being made, as Mayor Daniella Levine Cava’s office has just committed to $3 million in favor of the industry.
Families who need help paying for childcare services can visit the website https://familyservices.floridaearlylearning.com/ on the ‘School Readiness’ section. Those who don’t qualify for this program will be included in the ‘Thrive 5’ waiting list.