Money in the Crib
Changing diapers, sacrificing sleep, baby-proofing the house: the most painful challenge for new working parents may be paying for child care. How the prices got so high — and what can be done to lower them.
Michelle Mathews knows the feeling well.
When she was pregnant with her first child, even though she was assistant director of the MU Child Development Lab, she and her husband couldn’t afford full-time infant care for their daughter at Mathews’ place of work. Or at any other Columbia child care center, for that matter.
Mathews reduced her hours and found part-time care with a woman in the community who could cover the few hours between the time Mathews went to work and her husband was off.
For working parents, the choice between continuing careers and caring for a child is more than sentimental. For some, it costs more to continue working and pay for child care than it does to put their professional lives on pause and stay home with their children.
Mathews, now the director at MU’s Child Development Lab, sees parents make that sort of value judgment regularly.
“I empathize,” she says.
Citywide Challenges
In a city like Columbia — decent size population, home to multiple colleges, full of young families — finding quality, affordable child care that helps parents juggle the personal and professional can be a difficult task.
Jessica Macy, a senior associate at New Chapter Coaching, had four employees over an eight-year span at a nonprofit, where she worked until recently, leave the workforce. Those employees chose to stay home after giving birth because of the high cost of child care. Christina Gilbert, relationship manager at Advisors Edge Marketing, and her husband started looking for child care for their first child around the time Christina was three months pregnant. Even with months to search before the baby arrived, they still had to wade through wait lists before securing a spot, thanks in part to being “friends of friends of friends,” she says. Jennifer Bloss, an academic advisor at MU’s College of Arts and Sciences, and her husband faced combined child care costs that would’ve amounted to more than her salary for the cost of newborn twins and their 2-year-old less than a year ago.
Luckily, they had grandparents willing to pitch in.
“We were trying to figure out how much money we had in savings and how long that would last if I did go back to work versus if I had to stay home,” Bloss says.
Wait lists. Hefty bills. The desire to ensure that children are getting all the support they need during their crucial formative years while their parents tend to career aspirations. It all adds up to one of the biggest decisions working parents will ever have to make.
“With two working parents, it often is a conversation that leads to ‘You know what? I’m just going to stay home,’” says L. Carol Scott, CEO of Child Care Aware of Missouri. “‘Because it’s not important enough to me to work to pay out 90 percent of my salary in child care costs.’”
The Cost
Bailey Calton, a sales manager at Stoney Creek Hotel & Conference Center, has a 2-year-old son who has been going to Bright Start Academy in Columbia since he was about six weeks old.
Bright Start’s tuition bill for infants is $215 per week, which would be a little over $11,000 per year. Now that Calton’s son is 2, the rate is $200 per week, or $10,400 per year.
It’s worth it, Calton says. They’ve had a great experience at Bright Start.
“It’s tough to know what’s best, or which place is best, until you’re actually experiencing it,” Calton says. “But I don’t know that there’s a way to make that easier. It’s a big life decision, and those can’t be expected to be easy.”
Now imagine the Caltons have two preschool-age kids. Bright Start offers a $10-per-week sibling discount, but that’s still about $20,000 a year. If the Caltons had three children, like the Blosses, one sibling would be 50 percent off, still putting the total bill around $25,000.
And consider that Calton categorizes Bright Start as being in the “mid-to-high-priced range” in Columbia. There was another price bracket above that when they were doing their research.
“It’s almost like paying a mortgage or paying rent,” says Erica Dickson, founder of King’s Kids, a child care center in Columbia.
According to 2015 figures compiled by Child Care Aware of America, the average Missouri family pays around $9,000 a year in child care for children that are not yet school-aged when they send them to a child care center. That’s more than 11 percent of the median income for a married family in the state. The average annual cost for infant care in Missouri ($8,632) is more than the average yearly tuition at a public college in the state ($8,383), according to Child Care Aware.
And the burden isn’t that bad in Missouri when you compare it to the rest of the country: the average rate for two children — one infant, one toddler — in child care ($17,940) is only 21st most expensive out of 50 states.
“It’s nice to be right in the middle somewhere,” Scott says. “But still, early care programs in Missouri can be pretty expensive, especially when the quality is very good. Which is, of course, what we want for children.”
Scott says that the biggest determinant of cost within a community is not necessarily its size, but its education, employment, and income levels, as well as what the market will bear.
A child care market rate survey by the Missouri Department of Social Services in 2014 found that the 75th percentile of infant care centers in Columbia charged $48.18 per day and the 75th percentile of preschool providers charged $36.38. Those rates were similar to larger cities such as St. Louis ($50.90, $35.40) and Kansas City ($44.00, $34.00).
Springfield, despite having a bigger population than Columbia, charged $36.00 per day for infant care at the 75th percentile and $22.00 per day for preschool.
“You want the best for your child, since, in most cases, that provider will be with your child more than you are, but you have to consider your budget,” says Shawna Cook, office manager for a Columbia dental practice and mother of a 3-year-old boy. “But how do you put a price on the care of your child?”
Finding Quality
The first months can be the hardest.
First, a family has to take stock of its savings to see how long one of the parents can be off from work with the child after birth. Then, infant care tends to be more expensive than other categories because state regulations require a ratio of at least one teacher in the room for every four infants at a time in licensed centers.
That’s if you can even get your child into a center within his or her first year: Mathews says there’s currently a waiting list of more than 200 families for the 15 openings in her “Blue Door” infant and toddler classroom.
“Infant/toddler care is high-demand,” says Gay Litteken, executive director of the Mary Lee Johnston Community Learning Center. “Any before- and after-school care through centers comes at a high cost. I think that’s a high need in Columbia.”
Providers don’t have much of a choice in the matter when it comes to setting the price tag, Scott says.
“I guarantee you nobody is getting wealthy in the child care industry,” she says. “Profit margin is teeny-weeny compared to other industries.”
After five years as an administrative assistant at Mary Lee Johnston, Dickson decided she wanted to open a center of her own. In order to obtain a license to run the center, though, she first had to clear some hurdles.
An inspector surveyed her space and let her know how many children it could serve. She had to develop a handbook about her business and wade through a stream of paperwork. She went through health and sanitation inspections. She went through a fire inspection that included the installation of fire doors and a central control panel to link all the center’s detection devices. If she wanted to care for infants, she’d have to install a sprinkler system.
And if centers want to get accredited, get the seal of approval from the state that says they’ve taken the extra step in quality above licensing? That’ll cost even more.
Dickson opened King’s Kids in 2012. It provides after-school care for school-aged kids when school is in session and full-day care when it is not. She has thought about expanding her services and age ranges, but that would mean more staff, more space, more installations, more inspections.
More money.
“If you haven’t been through the process before of taking what is currently a residential home in R-3 zoning and transforming that into licensed child care space, and you don’t have a strong knowledge of construction and finance, it can be very daunting for somebody trying to get into the pre-school world,” says Paul Prevo, owner of Tiger Tots.
The notions of “quality” and “affordability” seem to be at odds in the world of child care. In order for providers to feature the type of care parents want for their children, they need to price their services to keep up with their overhead costs.
Litteken says when she was finding child care for her first son, more than two decades ago, she used providers that were affordable to her salary level then. Now, at a different place in her life and with more financial security, she says she probably wouldn’t repeat it.
Mary Lee Johnston has a sliding scale for its families, meaning the price depends on income. It benefits the children for Johnston to be more than a babysitting service.
“Questions parents often ask themselves before selecting a child care facility might be: Do they have a lot of outside or play time to work on gross motor skills? Do they go on field trips? What kind of help is required from the parents? Do they do parent-teacher conferences? Are they closed for holidays?” says Kate Stull, marketing and communications specialist at Columbia Insurance Group and mother of two. “A lot of times, there’s a down payment or a fee to basically reserve your child’s spot. Sometimes, that fee is non-refundable, which can also be a hindrance.”
“I guarantee you nobody is getting wealthy in the child care industry.”
— L. Carol Scott
Some parents, like Gilbert and Stull, who both serve on the board of First Chance for Children, a nonprofit that helps families with children 5 and under, know what specific traits they desire when seeking preschool for their children. Others don’t really know where to start, and the state of Missouri doesn’t help them much.
Missouri is one of only seven states that does not at least have a pilot program for a quality rating and improvement system, or QRIS, for its child care providers. Much like with restaurants or hotels, the QRIS evaluates providers based on certain criteria and assigns a star rating, rewarding the higher-rated centers and enticing the lower-rated ones with incentivized funding. Alaska, Connecticut, Hawaii, Missouri, South Dakota, West Virginia, and Wyoming are all in the planning stages for such a system.
Without it, parents have no real gauge for the quality of a child care provider. Two centers may be in the same price bracket but offer vastly different experiences.
Jack Jensen, executive director at First Chance for Children, says, “Sometimes their best source — and I say that sarcastically —for what is quality child care is Yelp.”
Filling a Need
Columbia, like many communities around the country, has a need for quality, affordable child care. Prevo says Tiger Tots has grown from being able to care for 15 students less than a decade ago to 325 in its two branches today. He’s looking at expanding on his second location this year and possibly opening up a third center in the near future.
The demand is there. But how difficult is it to fill?
Mathews has an overflowing infant waitlist at the MU Child Development Lab, but, in order to serve more infants, she’d have to hire more teachers and carve out more space.
The infant and toddler room is a money-losing proposition. The three pre-school rooms at the center actually “subsidize” it, Mathews says.
“Even though I could probably fill 100 infant/toddler spots, I couldn’t pay for it,” Mathews says. “Parents can’t afford to pay for the true cost.”
Then there’s the matter of attracting and retaining qualified staff members to care for the children. Scott says annual staff turnover at licensed child care centers runs at about 28 percent.
Finding trained teachers is costly. Keeping them is costly. The parents have to pay some of that bill.
“It’s important for parents to have that peace of mind that their children are getting quality care,” Litteken says. “And then we’re sending kids to school that are ready to be there, and that makes a huge difference for everyone.”
Providers bristle at the term “daycare.” They feel it devalues the profession.
“We don’t take care of days,” Scott says. “We take care of children.”
And if legislators see early childhood education as a less legitimate pursuit than K–12 education, they will be less likely to subsidize it. Without more government support, child care providers are less able to shoulder the costs of running their businesses and unable to pass the savings on to the consumers in the form of lower prices.
High school graduation is closely linked to third-grade reading scores, Scott says. Third-grade reading scores are linked to a child’s vocabulary when he or she enters kindergarten. A child’s vocabulary at school entry is highly dependent on what sort of environment he or she experienced in preschool settings.
Scott’s point being that, even if early childhood education is not deemed as important as K–12 in America, it should be.
That realization might make it a little easier for working parents to decide between investing in child care and investing in their careers.
“For younger parents with newer careers, in entry- to even mid-level jobs with corresponding salaries, this choice can be a real battle,” says Gilbert, who is president of the First Chance for Children board. “When you think about how much you would pay into daycare costs, and the idea of having someone else raise your child instead of you, it becomes an emotional decision on top of a financial decision.”