Why Child Care Is the Economy’s ‘Invisible’ Driver

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According to a study released last year by Child Care Aware America, a group of child care resources and referral agencies, the annual cost of daycare for an infant exceeds the average cost of in-state tuition and fees at public colleges in 31 states. In New York, for instance, day care costs nearly $15,000 a year; average in-state college tuition is $6,500.

Unlike many developed countries where child care and early education is heavily subsidized, the U.S. has no national policy on child care. “When we compare what we do as a nation to what other developed countries do in terms of child care, it’s embarrassing and it’s tragic,” says Stewart Friedman, practice professor of management at Wharton. “Part of it is rooted in the American ethos of individualism. You’re supposed to make it on your own.”

Not only does the high cost of child care in the U.S. hit the bottom line of individual families, it also has repercussions for the economy as a whole. For one, the tremendous strain on household budgets dents consumption, which in turn hinders growth. Second, the burden of dealing with (and paying for) child care is seen as a culprit that forces women to drop out of the labor market. And finally, the difficulties associated with child care are for some a deterrent to have children in the first place. The issue there, of course, is that in pure economic terms, today’s babies are the workforce of the future.

Notes

It is important to understand how society sees childhood, what are the socioeconomic challenges, and opportunities to understand how design can contribute to improving the issues found. If a community doesn’t have the basic needs attended how this affects kids, their play time, and education, and also… does it influence their creativity? What about single mothers that don´t have a support network, how do they manage their children’s education, work life and personal life? are children that have less material stimulus more creative than those that have everything? It’s also worth pointing out that childcare workers in the U.S. are very poorly paid. According to a U.S. Census Bureau report, the median wage for a childcare worker in 2011 was $19,098, which compares to a median wage of $19,680 in 1990 in constant 2011 dollars. This is a public and political problem, if childcare workers are so poorly paid how does it reflects on children’s education?

Reference

Rothbard, N. R., & Friedman, S. (2014, September 17). Why child care is the economy’s ‘invisible’ driver. Knowledge at Wharton. Retrieved January 26, 2023, from https://knowledge.wharton.upenn.edu/article/economic-impact-of-child-care/