How Universal Pre-K Drives Up Families’ Infant-Care Costs

Bronx daycare owner Angela Salas suspects it’s no coincidence that ever since New York City’s fre­e preschool program for three-year-olds arrived in her borough, her popular home-based child-care program has struggled.

It’s not for a lack of demand, says Salas: Her family daycare is as sought after as ever, with parents paying up to $385 a week. But with new, free public preschool available for three- and four-year-olds less than two miles away, the kids enrolling in Salas’s home-based program are now almost all very young. This makes for a costly business, as state regulation requires much heavier staffing for babies and toddlers than it does for older children. “I need to keep the three-year-olds in order to survive,” says Salas.

Salas used to hire two women at her daycare; now she needs four to meet licensing requirements. She’s raised tuition by $10 a week. It’s still not enough to make up for the cost of added staffing, she says. But if tuition goes any higher, few neighborhood parents will be able to afford it. “I don’t think I can sustain my business one more year if it continues this way,” says Salas.

All across the country, public preschool programs have been proliferating, to great fanfare. Washington, D.C.’s universal program is applauded for boosting labor-force participation of low-income mothers with young kids. And New York City’s Mayor Bill de Blasio credits his Pre-K for All program for higher test scores and a smaller ethnic and racial test-score gap among elementary school children who participated in the program.

But a seldom-discussed unintended consequence of these free programs for three- and four-year-olds is the toll they take on the already limited supply of affordable child care for children younger than two, especially babies. It’s a strain that can have far-reaching consequences for families.

The problem is rooted in simple economics. Caring for an infant costs far more than caring for a preschooler—in some places three times as much. But differences in tuition between the two age groups rarely cover the difference. It’s the tuition for the three- and four-year-old preschoolers that make it possible for most child-care programs to look after babies. So when programs lose their preschoolers, they’re losing their “most profitable children, and they potentially have trouble staying viable,” says Jessica Brown, an economist at the University of South Carolina.

Because of their small size, family child-care programs like Salas’s, which are run out of providers’ own homes, are likely the hardest hit of all.

“Because they have so few kids in the first place, family child-care providers have limited ways to recover from that and to keep serving families,” says University of Virginia doctoral student Justin Doromal, whose data regarding the spate of family child care closings in North Carolina recently made the rounds on early-education Twitter.

Doromal and Brown are among a small but growing group of researchers who study what providers like Salas have been living, and are working to quantify just how much of a toll public preschool programs may (or may not) be taking on infant and toddler care. While many of their findings are still emerging, taken collectively, they suggest that the very pre-K programs that are the pride of so many cities and states can squeeze the supply of affordable infant and toddler care, forcing some programs to close and others to raise their prices so high they render them unaffordable.

In Illinois, for example, the advocacy group Illinois Action for Children attributed 16 percent of 610 child-care center closings during a five-year-period to competition with public pre-K. In California, research by the Child Care Resource Center identified the growth of public preschool as a key factor for thousands of shuttered family child-care businesses across the state between 2008 and 2017, adding up to a 30 percent decline in the number of these programs.

And Brown estimates that New York City would have 20 percent more seats in child-care centers for children younger than two were it not for the city’s popular Pre-K for All program. Poor neighborhoods suffered the biggest blow, according to Brown’s analysis.

Perhaps recognizing this issue, in New York City, in what some in the field regard as a grand experiment, family child-care programs will soon be eligible to participate in the city’s 3-K for All program that offers free programs to three-year olds in many of the city’s school districts. Key to preserving child care for babies, home-based 3-K programs will be encouraged to continue enrolling infants and toddlers alongside the three-year-olds receiving free public preschool.

It’s a move considered controversial by some—unlike 3-K for All teachers in schools, family child-care 3-K teachers will not need to have a teaching credential and will continue to make far less money, leaving some concerned that the small, mixed-age 3-K programs will be of lesser quality. But it’s a compromise that could help to expand the city’s 3-K program while also protecting some of the infant and toddler child-care slots that so many working families, and their employers, depend on.

Loss of any form of affordable child care affects many families with young kids, but when a community loses slots for babies, it leaves families with scarce options, nudging some parents out of the workforce, and others towards providers who may cut costs by reducing quality, or caring for more children than is legally permitted, or safe.  

“Pre-K initiatives that lack strong ties to the child-care industry can lead to higher child-care costs, reduced employment, and lower lifetime earnings for parents with young children,” wrote economist Lori Taylor of the Bush School of Government and Public Service at Texas A&M University in 2014. “Many of the near-term gains to the parents of four-year-olds could be offset by losses to the parents of children three-years-old or younger.”

Brown suspects it’s no accident that her analysis found that daycare centers close to new, public pre-K sites experienced an uptick in public complaints. “Centers closer to these new sites are in stronger competition with them, and they are potentially losing children so they have to adjust on some margin, and are maybe cutting costs,” she says.

Cutting back on quality is a bad idea for kids of all ages, says Brown, but perhaps especially for babies and toddlers, whose brains are developing at a rapid clip. “There’s a lot of research showing that the earlier that you are able to intervene, the larger an impact it has on later life, so your environment at two might even have a larger impact than your environment at four,” she says.  

Sumon Chin, director of Asian child-care resource and referral at the Chinese-American Planning Council, which connects New York City families with child care, has seen immigrant communities struggle after what their research shows as a loss of more than 900 family child-care programs in a recent one-year period. (After accounting for family child-care programs that opened during that time, it adds up to a net loss of more than 130 home-based programs, according to data from the Council.)

Chin says that parents who are new to the country often seek out home-based providers who speak their language and “provide food and a home environment” culturally similar to their own. Many work low-wage jobs at nights and on weekends, and family child care is a lot more flexible than centers in terms of hours and pay, says Chin. “Families have a lot less options now, especially those who have young children under the age of three.”

One thing is certain—no one is suggesting that cities or states roll back their public preschool programs to protect infant and toddler care. On the contrary, the case for high-quality public preschool continues to gather evidence and momentum. Many of the Democratic presidential candidates have embraced universal child-care policy plans that could help accomplish this, so long as compensation for infant care reflects its true cost. Advocates say the goal should be to continue to grow public preschool, but to do it in a way that strengthens all early education settings, for all kids, from birth to their fifth birthdays.

Also, areas that offer public preschool not only in schools, but in a wide range of child-care settings help child-care programs hold onto preschoolers. Several states and cities, including New York City, have taken this route by offering public preschool in child-care centers, but few have meaningfully partnered with family child care: New York’s move to do so may be the bellwether.

For Salas, who has the credentials needed to enlist in 3-K for All, the decision to participate in New York’s program when it opens to family-child care centers like hers in the coming year is a no-brainer. Of course she will, says Salas. The math is simple: “I cannot sustain this business with only babies and twos.”

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