The Real Cost of Childcare for Parents and Educators

The national average yearly cost of childcare is over $10,000 a year — a major cost for many parents. However, the childcare sector is a complex and crucial part of the economy, providing safe and loving environments for our children.

In a conversation hosted by the U.S. Chamber of Commerce Foundation, Mary Janssen, Regional Director of NE Iowa at Iowa Child Care Resource & Referral, shared insights on the cost of childcare and its impact on both working parents and organizations focused early childhood education.

We Must Understand the Price of Childcare

Because the cost of childcare is so high, many assume childcare providers must be well-off. However, according to Janssen, this couldn’t be further from the truth.

“The salary has never been able to support that type of lifestyle,” she said. “More people are drawn to it for [their] passion.”

When it comes to a childcare budget, Janssen recommends viewing it as a “one-income household [paying] every single thing underneath that roof … to keep that door open.”

“That’s exactly how you think of a childcare center or even a child development home,” she continued. “They have one income coming in, mainly from families’ childcare fees … and those rates and that budget has to pay everything under the roof. There is not a lot of additional income coming into a childcare center.”

Childcare Centers Must Practice Budget-Balancing When Accommodating Different Age Groups

Janssen noted that one of the first conversations she has when going into communities involves how many children can fit within a childcare building. From there, they discuss the ages of the children to determine the level of care necessary. For instance, infants require more care (and, in turn, more money) than older kids.

“We always recommend a community assessment,” she said. “We just work really hard to figure out the matrix in that puzzle to balance that budget so they can continue to sustain and grow the program.”

Janssen noted a center’s top expense is usually staffing — most likely 90% of the budget. Additionally, centers often consider how much they’ll charge the families and pay the staff. She also stressed the importance of determining whether the building is affordable to house children, considering factors like sinks in every room, plumbing, and other necessities to provide a safe environment for the children.

The Childcare Sector Must Involve Community Collaboration

Community collaboration is crucial when it comes to the childcare sector, as partnering with community members and groups can help alleviate certain budget items.

“It's not necessarily a one-person issue,” said Janssen. “Childcare is a community issue.”

“Besides the children that come there daily, your staff [is] your number one part of the whole business because they're caring for the kids,” she continued.

To grow and sustain a program, however, you must be able to raise wages to retain staff. Janssen recommended asking yourself and community members: “How can we, as a community, come together and find resources to continue to raise the wage of childcare across the states?”

Achieving this will reap the best childcare workers who can provide the proper support to our children.

“You're a huge part of their life in childcare,” Janssen said. “I still have a lot of contact with kids … [who are] all growing up now and graduating high school, but it's really rewarding as the teacher to be that big part of their life as well.”