NC employers continue to make their voices heard about how child care availability and affordability for their employees is critical to the success of their businesses and organizations. They also recognize that quality child care supports the healthy development of our youngest children, our future workforce.
The U.S. Chamber Foundation, in partnership with the NC Chamber Foundation and NC Child, just released a report based on a March 2024 survey of more than 500 NC households with children under six years old. The survey sampled a population that is representative of our state’s racial and economic demographics.
Among the findings in Untapped Potential in NC:
- Due to employee absenteeism and turnover related to child care issues:
- Employers lose $4.29 billion annually
- The state loses $1.36 billion annually in tax revenue
- Parents lose too:
- 35% who experience employment disruptions said they left the workforce due to child care challenges
- 45% attending school said they had to make a significant change in their schedule due to child care challenges
- Low-income households were mostly likely to have a change in employment due to child care challenges at 31%, over middle-income at 27%, and high-income at 19%.
All told, that’s more than a $5.65 billion annual loss for North Carolina. And the survey did not quantify lost wages to parents who made family financial sacrifices, such as quitting a job or interrupting their education, due to child care challenges. Lost wages are not just when parents change jobs, quit, scale back hours, or do not accept promotions. These decisions can impact their future earnings, due to having less work experience, fewer skills, and less education.
Looking back at the results of a similar survey by the NC Early Childhood Foundation (NCECF) in October 2020 gives a snapshot of family child care challenges pre-, during, and post-COVID, indicating that losses continue to grow.
More than 800 parents in the workforce with children under five years old were asked how they were navigating child care and work – both pre- and mid-COVID. The participants were representative of North Carolina’s demographics, representing urban, suburban, and rural populations well, along with the state’s racial demographics.
Among the findings in our report, Early Education in the Time of COVID-19: An Economic Analysis for North Carolina:
- North Carolina parents lose $1.5 billion each year in lost earnings due to lower productivity and less experience; the extra cost of a job search to match work with child care; and future lost earnings due to less experience and fewer skills.
- North Carolina businesses lose $507 million in revenue each year through lost revenue now, due to lower output; extra workforce costs due to disruptions, employee absences, or the need to hire new employees; and lost future revenue, due to a less experienced workforce.
- North Carolina’s economy loses $414 million each year in lost tax revenue now, due to lower incomes; a smaller state and local tax base; and lost future tax revenue and weaker economic growth.
And North Carolina children lose. High-quality child care leads to substantial academic gains. Children who cannot access these programs can lose out on a critical educational advantage that can translate into impaired overall health, which is the foundation for learning; declines in test scores; and declines in high school graduation rates.
Right now, early childhood advocates are asking the NC General Assembly (NCGA) for $300 million to replace federal COVID relief funds to help stabilize child care programs through, among other supports, higher wages, and bonuses. Replacing these federal funds will avoid pay cuts, early educators quitting their jobs, and centers closing. Another important priority is the allocation of $95 million to increase the subsidy rate that child care providers receive from the state which allows low-income families to access child care. These are critical short-term fixes, not solutions. Quality and affordable child care that meets the needs of the families it serves means reimagining our system. The Care and Learning initiative in NC is working to do just that.
NC voters are on our side too. Polling over the last decade shows that voters across the political continuum want greater state investments in early care and education.
More employer voices are needed to ensure legislators hear from a range of voters about why access to child care matters. NCECF has created a one-page fact sheet complete with background, talking points, and how to reach your legislator. It’s so easy that we encourage you to contact your legislator this week.