Child-care prices have risen at a break-neck clip in the US — and that’s before daycare centers start to really feel the impact of the end of federal funding that kept them afloat through the pandemic.
Average monthly payments for child care in September were 32% higher than the 2019 annual average, according to an analysis by Bank of America Institute of the lender’s customer data.
Since 1990, child-care prices have risen faster than prices for essentials like housing, transportation and groceries. In recent years, low pay for staff, high demand and rising costs have strained the supply of spots. In New York City, the average price of infant care is $45,490 a year, according to Care.com, an online marketplace for finding caregivers. That’s about 16% higher than the national average of $39,270, according to the data, which is based on rates reported by service providers listed on the platform this month.
Costs are set to climb even higher: an estimated 70,000 centers are likely to close now that $24 billion in government aid has dried up, and those that remain open may need to charge more for care. The increases could threaten the historic labor market gains women in the US have made, as mothers tend to shoulder the burden of care responsibilities.
US Federal Reserve policymakers last month expressed concern that a lack of child care availability “could affect the sustainability” of female labor force participation.
This article was provided by Bloomberg News.