Free daycare for teachers' kids could help fix the crisis for all parents

• The US is in a childcare crisis due to cost and lack of available teachers.
• Kentucky may have solved both issues with a new policy.
• The state now gives free tuition to the children of childcare teachers.

The US is in a full-blown childcare crisis that could get worse. However, one potential solution appears to be working, but only if governments are willing to step in and help.

The crisis is two-fold.

First, childcare is expensive. Based on the average annual cost of childcare in the US of $10,600 per child and the median household income of $70,784 from the US Census Bureau, families spend 15% of their income on childcare alone.

And that's if they have only one child.

Second, finding openings can often be challenging, even if you can afford childcare. As of 2018, the Center for American Progress reported that over half of Americans lived in a childcare desert where the number of children outnumbered licensed care slots by three to one or more.

The result is many women are leaving the workforce, forgoing current earnings and potential advancement, to stay home with their children.

An ideal solution would address both of those issues at the same time, and Kentucky may have figured one out.

A possible solution in the Bluegrass State

In 2022, Kentucky attempted to address the double-whammy of cost and lack of available childcare by making childcare free for licensed and certified childcare program employees, regardless of household income.

According to NPR, the state made the change when they noticed the number of children receiving childcare subsidies during the pandemic fell by nearly half because parents were struggling to find open spots and classrooms stood empty due to teacher shortages.

The problem was exacerbated by stricter pandemic child-to-teacher ratios, combined with the struggle to find people to keep up with staffing needs.

One reason centers can't meet staffing requirements is simply that the job doesn't pay well. According to the Bureau of Labor Statistics, daycare childcare workers make an average of $12.40 an hour, less than half the average for all occupations ($28.01).

Data from the Economic Policy Institute shows that the families of childcare workers are twice as likely to live in poverty (11.8%) compared to others.

Another reason is some find the work mentally exhausting.

"Maybe someone's burnt out by the end of the week and quit, and there's nothing you can do about it," Sinead, a 24-year-old childcare worker in West Virginia and $9.50 an hour, told Insider. "Or they just realize they can make a higher wage at Walmart and much less responsibility."

According to ZipRecruiter, you can make an average of $17.00 per hour stocking shelves at Walmart.

Kentucky's solution is working, but at a cost

Kentucky's solution was designed to help parents who left jobs to avoid daycare expenses while at the same time creating more spots for other parents by having more teachers available.

After instituting the new subsidies for center employees, the number of children receiving state subsidies more than doubled to 40,000, including 3,600 children of staff members.

The solution does come at a cost.

Infant care in Kentucky costs an average of $534 per month. If you have two children, it is about $13,000 per year, or approximately 32% more than the average rent in the state.

According to NPR, Kentucky pays the center as much as $200 per week to cover the costs of the employee's child.

NPR found one example of a center offering free tuition to employees without state assistance in West Virginia. The move helped open spots for people on waiting lists, but one or more of those spots had to be taken by a family not paying tuition, lowering the center's revenue potential.

"Centers can't afford to give those spots away," the daycare center owner told NPR. "We have waiting lists."

Things are more dire at the federal level

The cost of childcare will also rise if federal funding approved during the pandemic and that ran out in September is not replaced. A 2022 survey by the National Association for the Education of Young Children found that 43% of surveyed childcare center directors said they would be forced to raise tuition when funding ran out.

When government funding ran out, it also put more centers at risk of closing their doors.

The snowball would force more families to cut back on work or quit. The foundation estimated the cost would be in the form of $9 billion in earnings for families. That would be on top of the $78 billion parents are already losing in income due to inadequate childcare, according to an analysis by economist Clive R. Belfield.

The US needs more affordable daycare and more people to work at the centers. Giving workers free tuition for their children can work, but only with government assistance.