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Coalition of business, education groups to study child care needs

Charlie Megginson Business, Education, Government, Headlines

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Federal Reserve Bank of Philadelphia, Delaware State Chamber of Commerce, Rodel and the Delaware Department will study child care needs. Photo by cottonbro/Pexels

A coalition of business and education groups have combined forces to better understand and communicate the economic importance of the child care sector in Delaware.

The public-private partnership is comprised of the Federal Reserve Bank of Philadelphia, the Delaware State Chamber of Commerce, Rodel and the Delaware Department of Education.  

The organizations involved share the view that access to high-quality early childhood education will be a critical component of Delaware’s post-pandemic economic recovery.

While the Federal Reserve and chamber have obvious workforce and business issues in mind, Rodel and the Department of Education focus on early childhood issues. Rodel long has been supporting early education issues such as universal pre-K as one way to improve Delaware education across the board, and the Department of Education oversees a lot of early childcare through its Office of Early Learning.

The fundamental argument the four groups are looking at is that with increased private and public investment in the child care sector, early childhood education will become more affordable and accessible, which will allow more parents to rejoin the workforce.

“COVID-19 has underscored the importance of affordable, quality care where it is most needed,” said Ashley Putnam, director of the Philadelphia Fed’s Economic Growth & Mobility Project. 

“There needs to be a shift in thinking about child care as a valuable and integral component of a strong economy, and we hope to equip stakeholders in Delaware with data and resources to meet the child care needs of their workforce,” Putnam said. 

Together, the partnership will create a “research in action lab” which will bring together public and private stakeholders to identify practical solutions to problems facing their communities.

In this case, the research in action lab will formulate strategies to “build an inclusive and equitable workforce recovery by removing barriers to employment, such as access to child care” according to a press release issued by the Philadelphia Fed.

A new report by the Philadelphia Fed said child care providers have been at high risk of closure throughout the pandemic, threatening the permanent loss of nearly 4.5 million child care slots across the United States and 58 percent of Delaware’s child care supply. 

Integrating child care into the workforce system may be especially impactful for Delaware’s economy, given that a majority of Delaware’s children live in households with working parents, the brief suggests. 

“The effects of the COVID-19 pandemic will persist into the coming months — even years — making the return to work especially difficult for the 48% of Delaware’s labor force with children,” it said.

The Center for American Progress found that the cost of providing center-based child care is, on average, 47 percent higher than the cost of meeting pre-pandemic requirements because of additional expenses incurred by providers who are operating under pandemic-related licensing requirements.

As a result, “child care programs may not be as accessible for working families as they were before those pandemic-related regulations went into effect.”

Studies reveal that lack of access to quality, affordable child care is especially pronounced in neighborhoods and families characterized as low- and middle-income, Latino or Black.

This has prevented many working families from returning to work.

Supporting access to affordable child care could prove to be a prudent business strategy, the brief says.

“Businesses have the opportunity to consider how supporting child care can serve as a strategy to maintain and grow their workforce and preserve and develop valuable workplace diversity,” it said.

The brief concludes “an accessible, quality child care sector can make the economic recovery fuller and more equitable for Delaware’s economy.”

According to a cost-of-care study conducted by the Department of Health and Human Services, 53% of center-based child care providers in Delaware reported that their operational costs had increased due to COVID, while 84% of providers reported that their enrollment had declined. 

However, COVID-19 is not solely responsible. Nearly universally, staff salaries serve as the biggest expense for center-based providers.

According to the DHHS report, “Most centers reported that increasing the minimum wage to $15/hour would be the tipping point where they would have to raise tuition. Others cited a minimum wage of $10-12/hour.”

Delaware is set to increase its minimum wage to $15 per hour by 2025, with the first jump to $10.50 on Jan. 1, 2022. 

The Philadelphia Fed plans to host listening sessions this fall to gather qualitative data from business leaders to identify practical solutions and develop a toolkit for Delaware businesses on the issue of child care.

“The toolkit will inform, equip and support employers, their employees and community’s child care needs. We hope to foster a dialogue that will build and strengthen connections between the business and child care sectors as we strive to build an inclusive recovery,” said Kelly Basile, the chamber’s vice president of strategic communications. 

To better understand how this issue impacts employers and employees, the group is seeking responses to a quick survey.

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