For many Americans, daycare costs keep them from pursuing a job, especially for those forced to leave work to care for their kids during the pandemic. According to Bloomberg, over half of parents with children younger than 15 spend at least 20 percent of their income on child care.
The Wall Street Journal writes that “an estimated 380,000 Americans in their prime working years, aged 25 to 54, held jobs before the pandemic but no longer did late last year, according to estimates from Bank of America. Bank economists said the lack of affordable and quality child care is a significant factor.
Bank-account data shows 7% fewer customers were making child-care payments at the end of last year compared with the beginning of 2020. The decline comes despite a roughly 2% increase in the number of jobs in the U.S. since February 2020, Labor Department data shows.
“Affordable child care has been a big issue,” said Anna Zhou, an economist at the Bank of America Institute, the bank’s research arm. “Some people can’t afford it, it’s keeping lower earning workers at home.”
Bank of America data show most prime-age workers who stopped working left lower-income jobs in the restaurant and retail sectors. Some 74% of the missing workers were in the bottom two quintiles by income distribution, while 6% of top earners quit working. The report defined missing workers as people who received paychecks by direct deposit for at least six months in 2019, but who no longer received them by the final quarter of 2022.”
CNBC noted, “Some 63% of parents report child care has become more expensive over the past year, according to a survey by Care.com. That high number has many concerned about whether they can afford care and what changes they may have to make to accommodate the rising costs.
‘When you think about, as a nation, how much we are spending on child care, and you think about rising costs of goods due to inflation … it is more than a double whammy,’ said Natalie Mayslich, president of consumer for Care.com.
‘People are being hit across all sectors and it is happening at the same time.’
The cost of nannies rose about 20% over the course of the pandemic, while babysitting and day care costs are up 5% to 15%, according to Care.com.”
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