United States

Over 1 in 4 Child-Care Providers Nationwide Still Remain Closed

Capuski | E+ | Getty Images

More than six months after a majority of stay-at-home orders lapsed in states across the U.S., the child-care industry has yet to fully recover. 

About 73% of day cares, child-care centers, preschools, enrichment programs, in-home day cares and before/after-school care programs that closed earlier this year have reopened as of early December, according to Procare Solutions, which provides child-care management software to approximately 30,000 clients nationwide. That means 27% of providers have remained closed.

Yet child-care providers in some states are struggling more than others. Only about 1 in 3 child-care centers that previously closed this year in Nevada and Vermont, for example, have reopened. Meanwhile 90% of providers serviced by Procare in Alaska, Delaware, Idaho, Nebraska, Rhode Island, South Dakota and Utah have returned to enrolling children. 

Procare's findings that 27% of U.S. child-care providers have not reopened is slightly higher than other estimates. Part of that may lie in the fact that Procare does not track home-based child-care providers, which research shows did bounce back faster.

The latest survey from the National Association for the Education of Young Children, for instance, finds that 93% of child-care workers and owners surveyed in November are employed by programs that are open, but the organization did specifically note that it was difficult to reach respondents in programs that closed. 

In August, the Bipartisan Policy Center found that 14% of parents reported their child-care programs had permanently closed. At that point, 70% of parents reported their centers were still closed or operating at limited capacity or scheduled hours. 

But it's true that many child-care providers remain offline, in many cases because it can be a losing proposition, at least financially, to reopen. About 56% of child-care providers surveyed in November report losing money by staying open, NAEYC found. About 42% of respondents say they have taken on debt using personal credit cards to pay for supplies and other items this year. 

That's because many centers are still operating at lower capacities, even as costs rise. The survey found that 91% are now paying extra for cleaning supplies, 73% have taken on extra expenses for personal protective equipment and 60% are paying additional staff wages. 

Procare Solutions
The data abovecomes from Procare Solutions, "Tracking the Impact of COVID-19 on the Child Care Industry." The report shows national child-care attendance data for the week of Dec. 7 compared to March 2, 2020, prior to the widespread outbreak of Covid-19 in the U.S.

The other aspect of this, however, is that attendance remains low. Using data from the majority of its clients, Procare tracked how close child-care providers are to getting back to normal attendance. As of Dec. 7, child-care centers nationwide are only operating at 49% of their full capacity.

Child-care centers serviced by Procare suffered an 87% drop in attendance when the Covid-19 pandemic prompted many states to issue stay-at-home orders and shut down facilities. And while attendance has rebounded from its lowest point in early April, it's still far from a complete recovery.

Congress recently passed the $900 billion Coronavirus Response and Relief Supplemental Appropriations Act of 2021, which allocated $10 billion to child care. But both proponents in Congress and industry advocates say that amount isn't enough to fully support the needs of child-care providers.

"Child care is the critical infrastructure that we have to make a significant investment in in order to have an economic recovery," says Rep. Katherine Clark, D-Mass. While Clark tells CNBC Make It that she was grateful for the $10 billion in funding, "it's just not nearly enough to make sure that we have a child-care sector that survives this pandemic."

Check out: Congress proposes $10 billion in relief for the child-care industry, but advocates say it’s only a ‘down payment’

Don't miss: The best 0% APR credit cards so you can finance your debt or new purchases interest-free

Copyright CNBC
Contact Us