Child Care in Peril: How COVID-19 Is Pushing this Essential Sector to the Brink of Collapse

Testimony of Hannah Matthews to the U.S. House of Representatives Education and Labor Committee's Member Briefing, May 26, 2020.

Thank you, Chairman Scott. I am honored to speak to the committee today about the central importance of child care and the devastating impacts of the coronavirus pandemic on the sector.

Child care is the ultimate essential industry. It helps parents to work, it helps children learn and grow, and it undergirds the economy. Yet, years of inadequate public investment have led to a child care system that is financially unstable. Families struggled to afford care, and child care workers made very low wages. Federal child care assistance through the Child Care and Development Block Grant (CCDBG) is a vital work support for families with low incomes but reaches only one in six eligible children.

The pandemic has exacerbated these gaps in our child care system. Child care has been shuttered or is operating under reduced enrollment nationwide. A recent survey by the National Association for the Education of Young Children found more than 100,000 providers closed across the country—those open are typically operating at 50 percent or less of their usual enrollment. This matters because child care is primarily financed with parent fees—and child care providers were already operating on very thin margins. In a March survey, 63 percent of child care providers reported that they would be unable to survive a closure of one month or less. Hundreds of thousands of programs right now cannot meet fixed costs or pay workers and may be unable to reopen. The damage to the sector is already severe: 330,000 child care jobs were lost in April alone, which is the equivalent of one third of all jobs in the child care sector. These job losses impact Black and Latinx women most of all.

Permanent child care closures will hurt children, families, and workers, and hold back our economic recovery. The supply of child care in low-income communities and communities of color, which was already lacking before the pandemic, is likely to be hardest hit. This will have devastating consequences for parents who need to work and their children who will be left with no safe options as states and communities reopen.

Congress took a critical first step in supporting child care by providing $3.5 billion for CCDBG in the CARES Act. This allowed states to continue payments to some child care providers and to support the increased operating costs of programs that are currently open.

But the investment to-date falls far short of meeting the need. CLASP’s analysis estimates the monthly costs of covering the most urgent needs for child care at nearly $10 billion.

Funding in the HEROES Act would be an important down payment to address the growing child care crisis. But that investment also will not save the child care sector from collapse.

A $50 billion investment would begin to address urgent funding needs. Child care needs dedicated direct public funding to keep child care providers afloat, ensure child care is available for essential workers on the front lines of this public health crisis, and provide resources to enable child care to reopen safely. We must treat child care like the public good that it is and build a stronger foundation for the future.

Thank you and I look forward to your questions.

View the entire briefing here