An analysis by the Economic Policy Institute shows the cost of childcare is outpacing the cost of college.
While parents of older children lament the rapidly rising costs of college tuition, those raising younger kids are also feeling a squeeze on their wallet. In many parts of the country it’s actually cheaper to pay for a year of in-state tuition at a public school than a 12-month stint in day care for an infant.
That’s the conclusion researchers at the Economic Policy Institute reached after crunching numbers for a recently released analysis of child care costs. In its report, “High Quality Child Care Is Out of Reach for Working Families,” the institute reveals that day care is largely unaffordable in many parts of the country for minimum-wage workers and even those at the middle-income level.
To arrive at its findings, EPI compared costs associated with providing quality day care for a 1-year-old child to the average price of a year of tuition at a public four-year college. The costs for day care were higher in 33 states and the District of Columbia, EPI found. When the slightly more affordable cost of providing care for a 4-year-old was examined, EPI found fees still exceeded tuition estimates in 24 states and the District of Columbia.
The U.S. Department of Health and Human Services deems day care affordable if it does not exceed 10% of a family’s income. EPI’s analysis revealed that child care was unaffordable for median-income, two-child families in 10 major metropolitan areas across the country, including Atlanta, Tampa, Stamford and Las Vegas.
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Some of the states where child care expenses outpace tuition are as follows, with infant care costs shown as share of full-time, in-state public college tuition:
- Washington, D.C. – 308.9%
- New York – 215%
- Wyoming – 251%
- Nevada – 205%
Other Key Findings
EPI’s analysis of 618 different communities also turned up a number of other interesting findings, including:
- Child care costs vary greatly – The range of monthly care costs for a household with one 4-year-old child ranges from about $344 in rural South Carolina to $1,472 in Washington, D.C.
- Minimum-wage earners are especially hard hit – Workers in this pay range in Hawaii where the state minimum wage is $7.75 need to devote entire earnings from full-time work from January until September to cover child care costs.
- Few states have child care costs that are close to HHS’ affordable 10% range – EPI determined that only a handful of the 618 areas it examined come close to that 10% threshold.
EPI’s study is hoped to provide food for thought for policymakers who want to improve the standard of living for American families. Whether meaningful action will result or not remains to be seen. What is clear is that in many communities across the country, it’s more affordable to fund a year of college tuition than 12 months of day care.
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