(Bloomberg) -- In the US, an average family of four will spend more annually on child care than they do on housing.
Both presidential candidates have put forward specific policy proposals to address housing affordability. But neither Kamala Harris nor Donald Trump have detailed how they would reduce costs for parents who are now in many cases spending $33,000 a year for two kids in day care.
It’s a source of frustration for American parents, who are often forced to dip into their savings or take on second jobs to make the math work. In every state in the country, the cost of child care outpaces average rent payments.
A combination of strict regulations around staffing levels and decades of underfunding led to this situation, which has only worsened since the pandemic when centers closed and many poorly paid workers left the industry altogether.
“There’s an agreement that things are not working for people, that there are interventions that are needed, but where things fall apart is identifying where those interventions are,” said Vicki Shabo, a senior fellow focused on gender equity issues at New America, a liberal think tank.
In an email, a Harris campaign spokesperson pointed to the vice president’s plans for increasing the child tax credit to as much as $3,600 for most kids, and $6,000 for newborns. Harris’ website says she plans to guarantee that “hardworking families can afford high-quality child care, all while ensuring that care workers are paid a living wage,” but doesn’t provide further details.
The Trump campaign’s national press secretary Karoline Leavitt said in an email that Trump prioritized expanded access to child care and paid family leave during his presidency “and he will do it again in his second term, while also implementing an economic agenda that will make America affordable again for working families.”
His running mate JD Vance has proposed boosting the child tax credit to $5,000.
Though tax credits get money in the hands of parents, they are “just one part of the ecosystem,” said Hailey Gibbs, an associate director of early childhood policy at the Center for American Progress, a liberal research and advocacy group.
“Having additional funds that bring down the cost of those necessities doesn’t necessarily invest in the supply of the sector or in the compensation of the workforce,” Gibbs said.
Bipartisan Support
A more comprehensive solution has been elusive. In 2020, Joe Biden acknowledged on the campaign trail that the country was in a “caregiving crisis” and promised to fix it. But experts say a patchwork of legislation since then has failed to fully address the root of the problem.
There’s bipartisan support for finding a solution. A July proposal by Virginia Senator Tim Kaine, a Democrat, and Katie Britt, a Republican from Alabama, would enhance care-related tax breaks and boost worker wages.
Most child-care legislation tends to die on the vine, however. The 117th Congress, which met from January 2021 to January 2023, proposed 54 child-care bills, roughly double that of a decade earlier, according to a Center for American Progress analysis. But during the 10 years to May 2023, only six bills total were signed into law.
One proposal that’s failed to get through Congress is the Child Care for Working Families Act, which would cap costs for families at no more than 7% of their income, in line with affordability thresholds touted by advocates. The plan would also provide child-care workers with pay increases and training opportunities, which researchers say would help address the industry’s staffing shortage.
Biden’s 2021 Build Back Better package, aimed at bolstering the middle class, was another failed attempt at addressing affordability. His original proposal included the 7% income cap as part of a $400 billion investment in child care. It would have eliminated payments for the lowest-income parents, provided for universal free preschool and boosted wages for care staff. It also included four weeks of paid parental leave for US workers.
Opposition from Republicans and West Virginia Senator Joe Manchin — then a Democrat, now registered as an independent — scuttled the plan. The final version, a $437 billion package renamed the Inflation Reduction Act, included no funding for child care or early learning, and no paid leave.
Successes have been limited.
Tax-credit payments handed out under Biden’s pandemic rescue plan gave families as much as a $300 monthly advance on tax refunds, temporarily keeping over 3 million kids out of poverty. A 2021 analysis of US Census Bureau data showed that most families used the cash for necessities like food and utilities, while 16% used it for child care.
Some $24 billion in pandemic aid helped more than 225,000 child-care programs stay afloat during the height of the Covid-19 crisis. Many centers used it to boost wages for their workers and discourage them from leaving for higher-paying jobs before the assistance ended.
And the CHIPS and Science Act, signed into law in 2022, requires companies applying for $150 million or more in grants to provide child care for their workers. Micron Technology Inc. is building centers for employees in Idaho and New York as part of this push.
“It’s a recognition that child care is part of a workforce solution, which is incredibly important, too,” said Julie Kashen, director for women’s economic justice at the Century Foundation, a progressive think tank.
Rising Costs
But the pandemic-era support has expired, and the cost of child care keeps rising. The latest Consumer Price Index data for August shows a 6.2% jump in day care and preschool costs from a year earlier, outpacing the 5.1% increase seen in July. The national average of center-based care for one child rose to $11,600 in 2023, up nearly 25% from 2017, according to advocacy group Child Care Aware of America.
At an Economic Club of New York event earlier this month, Trump gave a meandering answer to how he planned to address the crisis, and pointed to his plans to hike tariffs on foreign imports as a potential solution.
“We’re going to be taking in trillions of dollars, and as much as child care is talked about as being expensive, it’s — relatively speaking — not very expensive, compared to the kind of numbers we’ll be taking in,” he said.
Reshma Saujani, founder and chief executive officer of advocacy group Moms First, asked Trump the child-care question at the New York event. She said in an interview that any downplaying of the economic burden of this expense is “peak gaslighting.” She would like to see specific proposals from the candidates on this topic — and some empathy for parents who are struggling.
In an April poll of 1,000 voters, 89% said they want candidates to have a plan to address child care, including 80% of Republicans and 99% of Democrats surveyed.
“There needs to be a stronger commitment from the next president that sees child care as one of the top priorities that their administration needs to fix for families, period,” Saujani said. “Not number 18 on the list, but number one, two or three.”
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--With assistance from Stephanie Lai, Akayla Gardner and Ella Ceron.
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