State Breakdown: The Biden-⁠Harris Administration’s Funding Request Would Help Prevent Families Across the Country from Losing Child Care

White House urges Congress to provide an additional year of child care stabilization funding to support child care providers serving 10 million kids across the country

The Biden-Harris Administration is delivering on its promises – lowering costs for families, protecting American lives from the devastating impacts of challenges like the climate crisis and the opioid epidemic, and ensuring America can compete to win in the global marketplace. At the same time, additional resources are needed to meet the needs of the American people, support our communities, and protect our nation and its interests.

Child care is critical for women to participate fully in the economy and for children to get a strong start. Yet child care costs too much and pays workers too little. Without American Rescue Plan (ARP) investments in child care, the child care sector would have weakened much further. As ARP funds dry up, the sector urgently needs more support as parents are at serious risk of paying more or losing access to care altogether. This is why the President recently requested $16 billion in supplemental funding to sustain the child care sector. This funding request would support more than 220,000 child care providers across the country that serve a total of more than 10 million kids.

Here’s what the Administration’s $16 billion funding request to help prevent families from losing child care would mean for all 50 states and the District of Columbia:

Investments in High-Quality, Affordable Child Care Will Support Women’s Economic Security, Children, and Equity.

• Advancing Women’s Economic Security: Studies have found that increasing access to affordable child care can increase maternal employment and increase lifetime earnings for women with two children by close to $100,000. Other research finds that a major expansion of child care similar to those President Biden proposed in his budget requests would enable about 1.2 million more mothers to work full time.
• Providing Children with a Strong Start: Investments in affordable, high-quality early childhood development help children in the short- and long-run. The Economic Report to the President noted that benefits for children include: “school readiness and early social-emotional and cognitive skill development, as well as long-term outcomes like educational attainment, executive function, employment, and earnings.” These investments also translate into “fewer bad outcomes that are costly for society, such as poor health, high school dropout, and crime.”
• Supporting Underserved Communities: Lack of access to high-quality child care is particularly acute among families of color, indigenous communities, rural communities, and families with children with disabilities. Providing access to high-quality child care can begin to remedy these longstanding inequities.

Today Child Care Costs Too Much, Yet Child Care Workers Are Paid Too Little. Without more public support, child care providers charge more than many families can pay. At the same time, child care workers are paid too little for their own security or stability. In 2022, the national average price of child care was more than $10,800, and in 32 states, the annual average child care cost for an infant exceeded the average in-state tuition and fees at a public 4-year university. While there is significant national variation, median child care prices for one child can range as high as 19% of median family income, according to the U.S. Department of Labor. A Treasury study noted that difficulty in finding affordable child care leads some parents to reduce their work hours, turn down promotions, or drop out of the labor force entirely, with lasting negative effects on women’s earnings.

Despite these high prices, child care providers operate on thin margins and child care workers receive very low wages – a median of $13.71 per hour. This leaves workers without the dignity and security they deserve – and leads to instability in the workforce and lower quality of care.

Without Pandemic Funding, the Child Care Sector Would Have Spiraled Downward. Even before the pandemic, the number of licensed center-based child care providers dropped by about 15 percent between 2012 and 2019. During the pandemic, the number would have plummeted further but for the ARP, which provided $24 billion to help more than 220,000 child care providers stay open or re-open so that the parents of nearly 10 million children could get to work. One in three providers reported they would have closed permanently without these funds. Over 97% of rural counties received aid in most states. Child care also strengthened families’ economic recovery: The President’s Council of Economic Advisers found that mothers’ employment recovered more quickly in areas with greater child care capacity supported by ARP child care stabilization grants.

More Funding Is Needed Now So Parents Do Not Lose Child Care. Failure to sustain Congress’ child care investments threatens to drive providers out of business, increase their charges, or both. For families, this would mean higher out-of-pocket costs, fewer options for care, and more women leaving the workforce. This is why the President has called on Congress to provide $16 billion to extend the child care stabilization program, which will help child care providers stay afloat, allow parents to continue working and earning, and keep children in quality care. The White House has assembled an estimated state-by-state breakdown, which highlights the funding each state would stand to receive, the providers funding could reach, and the children who could benefit with the additional year of child care stabilization funding.

The $16 Billion Proposal Builds on the President’s Deep Commitment to Child Care. The President has consistently prioritized lowering child care costs for families and boosting wages for child care workers. In the President’s FY2024 Budget, he called for $400 billion over ten years to increase child care worker pay and to limit child care costs so that most families pay no more than $10 a day for child care. The President also signed a historic Executive Order in April directing nearly every Cabinet-level agency to expand access to affordable, high-quality care and provide increased support for care workers and family caregivers. Agencies have already taken action to implement the President’s directives, including proposing to cap co-payments for 80,000 families benefiting from federal child care assistance. In July the White House hosted a first-of-its-kind convening on child care, gathering nearly 100 state legislators from across the country to discuss ways to improve child care governance, access, affordability, and the workforce. Senior staff have been meeting with parents from across the country on the need for high-quality affordable child care.

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