Child care costs soaring due to inflation

Published: Jul. 6, 2022 at 8:52 AM MDT
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(CNN) - Many businesses have struggled to stay afloat during the coronavirus pandemic, and the child care industry is no different.

Now, day care services are dealing with inflation.

At Kidzstuff Childcare Center in Baltimore, the price of food, rent, power and supplies is soaring.

“Everything is up,” said Kidzstuff Childcare Center CEO Angela Kidane.

Kidane has raised wages roughly 40% but is still struggling to hire staff. With one classroom closed, her waitlist is growing.

“We’re probably up between 30% to 35% for operating costs. That cost is going to have to be passed along to our parents,” she said.

This fall, she will raise the tuition at her nonprofit for the third time in 12 months. In all, it is up 30% and for some families, that is thousands of dollars a year.

“It’s not easy for us to have to do this, but it is a necessity,” Kidane said.

She says if she did not raise tuition prices, the day care would not be able to stay open.

Programs nationwide have done the same.

“It’s happening everywhere. To keep the doors open, this is what has to happen and it is going to continue,” said National Childcare Association director Cindy Lehnoff.

Inflation is just part of it.

At least 15,000 programs have closed, with 11% fewer child care workers than pre-pandemic, leaving an industry with a median wage of just over $13 an hour.

Now, many parents face longer waitlists and tuition hikes.

Sean Toner owns Beach Babies in Lewes, Delaware.

He is raising tuition 8% to 10% this fall for the second straight year to offset inflation. He is also raising teacher wages to roughly $14 an hour.

“I don’t want to be that person that’s driving away the parents,” he said.

Jessica Gebbia is a teacher at Beach Babies and her 5-year-old son attends day care there as well.

“Most of my paycheck is going just to have him here, and that’s rough because now we have gas prices, food prices., everything’s just going up and up,” she said.

She says she can’t leave the industry because she loves what she does.

“These children need teachers who do love what they do,“ she said.

Many mothers have left the workplace and as of May, women’s jobs made up 88% of those lost in the pandemic.

To-wen Tseng and her husband have struggled to afford child care in San Diego.

Her employer cut her hours in half, so she flew her sons to Taiwan to stay with family as she looks for a second job.

“If I just quit my job and stayed home and watched my kids, maybe the whole thing will be easier for my family. I hate to say this, but this is true,” Tseng said. ”The reason why we’re still struggling to pay for this child care, it’s because I don’t want to give my give up my career.”

Millions of parents are making tough choices.

For Jessica and her husband, they made a decision not to expand their family.

“The child care plays a big part in that. I can’t imagine having the two of them in day care. There’s just no way I wouldn’t be able to do this job,” she said.

According to a senior economist at Wells Fargo, the child care industry has the greatest share of female employees with women accounting for 96% of the workforce.

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