Child Care Costs Are a Workforce Problem—Fix Them

Child care now costs more than rent in most large U.S. metro areas for families with two young kids. That’s not a “family budgeting” issue. It’s a workforce participation issue hiding in plain sight.

If you work in education, workforce development, HR, economic development, or policy, you’ve probably watched the same frustrating pattern repeat: people want to earn a credential, start an apprenticeship, or take a better job—then child care collapses the plan. The reality is simpler than we pretend: a skills pipeline can’t function when parents can’t show up.

This post is part of our Education, Skills, and Workforce Development series, and I’m taking a firm stance: affordable child care is critical workforce infrastructure. Treating it like a private luxury is one reason labor shortages persist, training programs miss completion targets, and employers can’t stabilize schedules.

The real cost isn’t just tuition—it’s attendance

Answer first: When child care costs exceed rent, the biggest workforce impact is not the price tag itself—it’s the instability it creates in education and employment.

A recent metro-level analysis found that child care for two young children costs more than average rent across the 100 largest U.S. metro areas. For one child, care is sometimes less than rent, but adding a second child flips the math fast. Nationally, annual child care for one child reached about $13,100 in 2024, up roughly $3,700 since 2017.

Those numbers matter for household budgets, but they matter even more for workforce systems because they hit the two metrics training providers live and die by:

• Enrollment: Parents delay or skip programs when they can’t secure care.
• Completion: Missed classes, inconsistent attendance, and dropouts rise when care is unreliable.

Workforce boards often talk about “wraparound supports” as if they’re a nice extra. Child care isn’t extra. It’s the condition for participation—especially for short-term credential programs and shift-based jobs where being late twice can get you fired.

A simple (brutal) household calculation

If two working adults still can’t cover housing plus child care, one adult exits the workforce or reduces hours. That’s not a preference; it’s triage.

And it doesn’t just hit low-income families. Middle-income households get squeezed because they frequently earn “too much” to qualify for meaningful subsidies but nowhere near enough to absorb market-rate child care. This is one reason labor force re-entry after having a child can take years.

Why prices keep rising while educators stay underpaid

Answer first: Child care is expensive because it’s labor-intensive, heavily regulated for safety, and delivered through a fragile market—yet wages stay low because centers operate on thin margins.

People assume high parent fees mean someone is getting rich. Most providers are not. They’re stuck between three non-negotiables:

1. Staffing ratios and safety requirements (you can’t “efficiency” your way out of caring for infants).
2. Parents’ limited ability to pay (families have ceilings).
3. Low, inconsistent public subsidy support (many systems under-reimburse).

In Pennsylvania, for example, advocates report child care workers averaging around $15/hour, while retail employers can start at $17–$21/hour, sometimes with signing bonuses. That labor competition is devastating. When early childhood educators can earn more stocking shelves with less stress, centers lose staff, classrooms close, and waitlists explode.

Inflation is squeezing providers from both ends

Operating costs have climbed: food, supplies, rent, and especially liability insurance, which some providers report has tripled. Providers then face a no-win decision:

• Raise tuition (families drop out), or
• Absorb costs (centers close), or
• Cut quality (staff burnout rises).

None of those outcomes helps workforce development. In fact, they create a compounding effect: fewer slots → higher prices → more parents leave work or training.

The subsidy problem: when “market rate” isn’t the real rate

Answer first: Many state child care subsidy formulas don’t cover the true cost of care, so providers shift the gap to parents—or to their own unpaid labor.

One of the most maddening mechanics in U.S. child care is how reimbursement rates get set. In several states, subsidy amounts are based on “market rate surveys.” In practice, that can mean the state reimburses something closer to what struggling families can pay, not what it costs to deliver safe, high-quality care.

Advocates in Alabama describe cases where:

• A parent pays $400/month
• But it costs a provider $900/month to deliver the care

Someone eats that $500 gap. Often it’s the provider—frequently women, and disproportionately Black women—taking second jobs, applying for small grants, or reducing their own pay to keep doors open. That’s not sustainability. That’s slow-motion collapse.

Administrative delays are a workforce issue, too

If reimbursements arrive a month late, providers still feed children today. Late payments translate into housing, food, and health insecurity for caregivers, which drives turnover. And turnover is not an HR annoyance in early childhood—it can mean a classroom closure.

Workforce developers should treat this like a supply chain: payment delays disrupt supply (available child care slots), which disrupts labor supply (parent participation).

Culture is policy: the myth that child care is a private choice

Answer first: One reason we “can’t fix” child care is that too many voters and lawmakers still see it as personal responsibility rather than shared economic infrastructure.

There’s an old, stubborn narrative: kids should be home with their mothers. Not parents—mothers. That belief doesn’t match economic reality for most households, and it ignores single-parent families entirely.

The more useful frame is the one the pandemic made impossible to ignore: without child care, people can’t work. Employers felt it immediately through absenteeism, schedule instability, and turnover.

That’s why unusual allies—like chambers of commerce—often move the conversation further than education advocates alone. Business leaders can translate child care into terms that legislators respond to:

• missed shifts
• reduced labor force participation
• slowed regional growth

And they can say it plainly: a city can’t recruit employers if parents can’t find child care.

What actually works: a workforce-first playbook for child care

Answer first: The strongest solutions blend public funding, employer participation, and education-to-career pathways for early childhood educators.

If you’re trying to generate leads in education and workforce development, the most credible approach is to offer practical frameworks that agencies and employers can implement. Here are models I’ve seen work conceptually across regions—even though the funding details vary by state.

1) Treat child care like job training infrastructure

Workforce programs already budget for:

• tuition assistance
• tools and uniforms
• transportation
• exam fees

Child care should sit in that same category. Not as a one-time stipend, but as a predictable support tied to attendance and completion.

Practical options:

• Child care vouchers for participants in registered apprenticeships and short-term credentials
• On-site care partnerships at community colleges or training hubs
• Shared services networks that reduce back-office costs for providers, stabilizing supply

If your program outcome depends on showing up, fund the conditions that make showing up possible.

2) Pay providers based on cost, not wishful thinking

States can revise subsidy systems so reimbursements reflect:

• the actual cost of staffing ratios
• local cost of living
• quality improvement expectations

This isn’t charity. It’s how you prevent the “provider starvation cycle” where low reimbursement drives low wages, which drives turnover, which drives closures.

A good rule: if reimbursement rates don’t let providers pay competitive wages, you’re subsidizing failure.

3) Build an early childhood educator pipeline (and pay it)

If we want more child care slots, we need more early childhood educators—and we need them to stay.

Workforce developers can help by creating stackable pathways:

1. Paid entry roles (assistant teacher)
2. Earn-and-learn credentials (CDA, certificates)
3. Degree pathways (AA/BA in early childhood)
4. Leadership tracks (director credentials)

But here’s the non-negotiable: credentials without wage gains won’t retain talent. If a credential raises expectations but not pay, it accelerates burnout.

4) Employers: stop pretending this isn’t your problem

Employers don’t have to run daycares to make a difference. They can:

• contribute to a regional child care fund (especially in sectors with shift work)
• offer dependent care benefits that cover nonstandard hours
• stabilize schedules (predictable shifts reduce care breakdowns)
• partner with providers to reserve slots

This is especially relevant in December, when seasonal overtime, retail peaks, and year-end production runs collide with school breaks. Child care failures spike exactly when many employers need reliability most.

5) Measure child care as a workforce KPI

If your region tracks job openings and training enrollments, track child care too:

• available licensed slots per 100 children
• average price of infant and toddler care
• provider turnover rates
• time-to-reimbursement for subsidies

What gets measured becomes fundable.

“People also ask” (and the straight answers)

Why is child care so expensive compared to rent?

Because it’s labor-heavy, requires low adult-to-child ratios for safety, and providers can’t spread costs across large “units” the way housing does.

If parents pay so much, why are child care wages low?

Most centers operate on thin margins. High parent fees often cover rent, insurance, food, and staffing—without leaving enough to raise wages meaningfully.

What’s the fastest way to improve affordability?

Increase supply and stabilize providers by raising reimbursement rates to match real costs and speeding up payments—while expanding vouchers for parents in work and training.

Where workforce leaders can start in 30 days

Child care policy can feel enormous. You can still take practical steps fast.

• Training providers: Add a child care intake question set (hours needed, ages, backup options). Then build referral partnerships.
• Workforce boards: Pilot a completion-focused child care stipend for one program cohort and compare attendance/completion rates.
• Employers: Identify the top two roles most affected by absenteeism and map how many employees have children under five. That’s your business case.
• Community colleges: Use spring enrollment planning to coordinate child care capacity near campus and during evening/weekend class times.

These are not forever solutions. They’re proof points—exactly what you need to win bigger funding.

The stance that matters: child care is a skills strategy

Child care costs more than rent in most metros, and we keep acting surprised that workforce participation is fragile. The surprise is that we’ve allowed child care to sit outside workforce strategy for so long.

If your mission is skills development—getting more people into training, credentials, and good jobs—affordable child care is part of your job. Not because it’s trendy, but because it’s causal.

If we want a resilient workforce in 2026 and beyond, we’ll have to answer a blunt question: will we keep building training programs that parents can’t realistically attend, or will we finally fund the infrastructure that makes participation possible?