June 26, 2020
The COVID-19 pandemic that shut down the economy in March has led to sharp declines in employment and output. In December, women made up more than half the workforce; now, for the first time, women have lost jobs at a more rapid rate than men. They need to be able to return to employment in large numbers if the economy is to recover and get onto a strong growth path.
The importance of the childcare ecosystem to the effective functioning of families and the economy has come into sharp focus. Childcare workers are widely recognized as essential to the nation’s post-pandemic economic success. Getting the economy moving again will require a policy response and spending on early care and education (ECE) commensurate with its economic and social importance.
So it’s disappointing that the Democrats’ $1.5 trillion infrastructure proposal, the Moving Forward Act that the House will vote on before July 4, includes just $10 billion targeted on rehabilitating childcare facilities. The funds are earmarked for renovations to meet immediate COVID-19 related health and safety needs of children. The remaining 99.3 percent of the funding in the bill provides $400 billion for highways, bridges, and public transportation plus funding to fix other deficiencies in physical infrastructure. There is no funding for social infrastructure to expand quality, affordable childcare. Failing to adequately invest in a robust childcare infrastructure will slow economic growth and further increase inequality.
Alarmingly, the HEROES Act, passed earlier by the House to help those devastated by the pandemic, provides just $7 billion of the $50 billion needed to meet the immediate operating costs of licensed family homes and early care and education centers. The already inadequate current system of care for young children is in danger of collapsing. Half of all childcare facilities are closed, and employment in the industry, which numbered more than one million workers a year ago, had fallen by 300,000 in May 2020. Public financing to restore the pre-pandemic childcare and early education ecosystem is the first step in assuring that all workers—including the nearly two-thirds of mothers with a child at home under the age of 6 who were in the labor force in 2019—can return to work.
To the surprise of many who have been dismissive of the low-paid workers who provide care services, the pandemic has revealed that care work is the backbone that supports all the other sectors of the economy. The low esteem of these jobs has led to massive underpayment of workers and underfunding of the infrastructure necessary to sustain the care economy and support the vital services it provides. This is certainly true of childcare and early education.
Investment in a publicly financed national early care and education system provides the same benefits to the economy as other infrastructure investments. It is simultaneously job creating, job enabling, and provides a solid foundation for the subsequent educational success of children and their contributions, as adults, to the economy.
Expanding access to affordable childcare is job creating. It provides employment to workers who construct and retrofit spaces to house facilities. It increases the number of young children who enroll in ECE and the number of teachers, aides and others to care for them. It provides employment for workers whose jobs are not coming back.
An expanded ECE system is also job enabling. If the share of women with children under the age of 6 in paid employment increased from its pre-pandemic 64 percent to 70 percent, I estimate this would add a million workers. The estimate is reasonable; 74 percent of women with children aged 6 to 17 are employed, higher largely due to access to public K-12 education. Some mothers who work part-time because they can’t arrange care of young children or after-school care for older children can increase their hours to full-time. If half did this, that would have the same effect as adding another 1.2 million women to the labor force. An increase of 2.2 million workers would result in an annual increase of about $274 billion in real GDP, expanding the goods and services available to Americans to enjoy.
Finally, investment in quality ECE for children 0 to 5 years of age yields a significant positive rate of return. This is especially true of high-quality programs that enroll young children from economically disadvantaged families. A rigorous analysis of one such program found that every dollar invested yielded $7 to $12 back to society.
Social infrastructure holds the key to successfully navigating a range of challenges on the horizon. This is nowhere more important than in the care and education of young children. We should not ignore this important lesson of the pandemic when establishing priorities for infrastructure investment.