Day care a huge expense for parents

Median costs range from $565 to $805 a month; subsidies help only the poorest

Monday, June 24, 2002

By RUTH SCHUBERT
SEATTLE POST-INTELLIGENCER REPORTER

Day care for the first four years of a child's life is almost twice as expensive as four years of tuition at the University of Washington.

And yet, experts say, child care in the United States tends to be mediocre at best -- hampered by high turnover and lousy pay.

It's a low-margin business without much in the way of government support, pushing most of the financial burden onto parents.

"The whole community has a stake in the child care system working," said Billie Young, manager of child-development programs for the city of Seattle. "It's not working right now because the system is largely dependent on what the parents can afford to pay, and parents are strapped to pay the current rates."

In King County, the median cost for full-time infant care at a day care center was $805 a month in 2000, according to a state survey. For toddlers, the monthly cost was $660; for preschoolers $565. That adds up to about $31,500, compared with about $16,700 for four years of tuition for a UW undergrad. State and local child care subsidies help only the poorest families. And those subsidies are getting slashed in the current recession.

In February, Gov. Gary Locke increased co-payments and tightened income eligibility for the state subsidy program from 225 percent to 200 percent of the federal poverty level -- $29,260 for a family of three.

Also this year, King County eliminated its nearly $1 million sliding-scale program to help low-income families pay child care expenses.

At current rates, a parent might expect high-quality care, but a national study in 1995 found that 40 percent of infant/toddler rooms in centers offered "poor" care.

The economics of the industry is largely to blame. For-profit day cares typically earn a pre-tax profit of 4 percent to 5 percent, according to Marketdata Enterprises, a Florida research firm.

Roughly two-thirds of a for-profit center's costs are labor, and providers can't save money by cutting staff because of required minimum teacher-child ratios. In Washington, the requirements range from one adult per four babies to one adult for every 15 kids over the age of 4.

"It's not like a department store that can say, 'We can live with one less clerk,'" said Lynn White, executive director of the National Child Care Association. "That provides a lot of inflexibility."

Because of higher labor costs, baby and infant care is usually a net loss. As a result, many centers don't provide infant care at all, contributing to a severe shortage in parts of King County.

These low profit margins, coupled with a societal predilection for viewing child care as nothing more than advanced baby sitting, translate into low wages.

Statewide, the median wage for child care aides in centers was $7.33 an hour in 2000, $8.66 for teachers. That compares with $10.34 for a crossing guard and $19.34 for a primary school teacher.

Employee turnover is also high at Washington child care centers, with more than half the staff changing each year, according to a state analysis.