New Care.com Report Reveals Soaring Childcare Costs Are Crippling Majority of American Families
13 June 2023 - 11:00PM
Business Wire
– Both Single and Married Working Parents Spend
on Average in Excess of 20% of Household Income on Childcare –
Care.com’s 2023 Cost of Care Report found that parents
spend 27% of their household income (HHI) on average on childcare,
up from 24% just a year ago and nearly four times the amount deemed
affordable by the U.S. Department of Health and Human Services
(7%). The research also found that the majority of parents (59%)
expect to spend more than $18,000 on childcare in 2023, nearly
double the cost of in-state college tuition.
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A decade of rising childcare costs from
Care.com's 2023 Cost of Care Report. (Graphic: Business Wire)
The report comprises survey results of 3,000 parents and a
decade of childcare cost data. It reveals an imploding
post-pandemic childcare landscape for U.S. households with
children, or 40% of the total U.S. population. Lengthy and costly
daycare waitlists along with sky-high childcare prices continue to
have a major impact on how families juggle care, participate in the
workforce, and manage their household finances.
“America’s childcare crisis is just that: a crisis for the
entire country and it impacts us all, whether you have children or
not,” said Tim Allen, CEO, Care.com. “Childcare is claiming a
disproportionate amount of household incomes and a decade of rising
childcare costs should be a wakeup call that the system as we know
it completely fails the vast majority of families.”
Natalie Mayslich, President, Consumer for Care.com added, “So
much is discussed about the staggering college debt families incur.
What does it say about our system that a year of childcare for more
than half of American families is actually double the cost of
in-state college tuition?”
Highlights from the 2023 Cost of Care
Report:
A Decade of Rising Weekly Costs*:
- Nanny: $736 (up 56% from $472 in 2013)
- Daycare: $284 (up 53% from $186 in 2013)
- Family Care Center: $229 (up 80% from $127 in 2013)
- Babysitter: $179 (up 92% from $93 in 2013) * infant
rates except for babysitter, which is not age limited. Rates for
toddlers, after school sitters, as well as multiple children, can
be found within the report.
Childcare Costs Continue to Soar:
- ● Parents are spending increasingly more of their earnings on
childcare:
- 67% spend 20% or more of their annual HHI on childcare (up from
51% in 2022).
- 89% spend 10% or more of their annual HHI on childcare (up from
72% in 2022).
- ● On average, families spend 27% of their HHI on childcare with
the majority of parents (59%) planning to spend more than $18,000
on childcare this year.
- With a national family median household income of $91K,
childcare costs for the typical American family are even more
staggering:
- 45% of families earning less than $100K annually will spend
more than $18,000 on childcare in 2023, amounting to 18% of their
HHI;
- 43% of families earning less than $75K will spend more than
$18,000, amounting to 24% of their HHI; and
- 39% of families earning less than $50K per year will spend more
than $18,000, amounting to a whopping 36% of their HHI.
The Daycare Dilemma:
- Three in four parents (75%) estimate that there are fewer than
half a dozen daycare centers within a 20-minute drive of their
home. Additionally, 64% have been waitlisted for daycare with
nearly half (49%) waiting longer than three months to get a
spot.
- Beyond the inconvenience, waiting proves costly with 68%
spending an additional $200 or more on care each week (or $2,400+)
throughout the duration of the wait.
Childcare Villages Are Changing:
- Parents now rely equally on daycare centers and nannies (each
30%), as compared to last year when daycares were used more
frequently (31% vs. 22%). The shift reflects the changing nature of
work for parents who now need more flexibility.
- In fact, 45% use childcare in sporadic, nontraditional hours,
such as 10am to 1pm. The desire for flexible care solutions is
further reflected by the fact that, if both cost and availability
were no object, parents would choose a nanny (37%) over daycare
(35%).
Childcare’s Impact on
Families
Family Type
Work Type
Top Childcare Arrangement
Preferred Childcare Arrangement
Percent (%) Spending More Than
$18K on Childcare in 2023
Avg. Percent (%) of HHI Spent
on Childcare
Single Moms
Hourly
Daycare (35%)
Daycare (30%)
48%
28%
Salaried
Daycare (66%)
Daycare (64%)
80%
28%
Single Dads
Hourly
Paid Family (33%)
Paid Friends/Nanny (31%)
49%
31%
Salaried
Paid Friends (33%)
Nanny (29%)
47%
23%
Married Moms
Hourly
Paid Family (40%)
Nanny (40%)
64%
31%
Salaried
Daycare (32%)
Nanny (37%)
63%
26%
Married Dads
Hourly
Paid Friends (35%)
Nanny (33%)
59%
28%
Salaried
Nanny (36%)
Daycare (43%)
61%
22%
Top 5 Most Expensive
States for Childcare
Top 5 most expensive states to
hire a nanny:
Top 5 most expensive states to
hire a babysitter:
Top 5 most expensive states
for daycare (infants):
State
Weekly Rate
State
Weekly Rate
State
Weekly Rate
Washington D.C.
$885
Washington D.C.
$194
Washington D.C.
$417
Massachusetts
$864
Hawaii
$189
Massachusetts
$326
California
$849
Massachusetts
$189
Washington
$310
Washington
$838
Washington
$188
California
$288
Connecticut
$799
California
$188
Connecticut
$260
Along with the report, Care.com released a new childcare cost
calculator for families to estimate hourly rates for in-home care
in their city.
The full results of the 2023 Cost of Care Report can be
found here and access to graphics displaying the data can be made
available upon request.
2023 Cost of Care Report Methodology
This sample of 3,000 U.S. adults was surveyed on April 25, 2023
and April 27, 2023. All respondents are parents of children 14
years or younger and currently pay for professional childcare,
confirmed by both consumer-matched data and self-confirmation.
Audience quotas were set to obtain a statistically significant
sample of customized geographic regions. DKC Analytics conducted
and analyzed this survey with a sample procured using the Pollfish
survey delivery platform, which delivers online surveys globally
through mobile apps and the mobile web along with the desktop web.
No post-stratification has been applied to the results.
Weekly rates for nanny, babysitter and after-school sitter are
based on 2022 advertised rates on Care.com. All daycare and family
center rates are based on rate information from centers listed on
Care.com, except for 2013 rates, where daycare and family care
center rates for infants and toddlers are based on Child Care
Aware’s national data.
About Care.com
Available in more than 17 countries, Care.com is the largest
online platform for finding and managing high-quality family care.
Care.com is designed to meet the evolving needs of today’s families
and caregivers, offering everything from household tax and payroll
services and customized corporate benefits packages covering the
care needs of working families, to innovating new ways for
caregivers to book jobs. Since 2007, families have relied on
Care.com’s products—from child and elder care to pet care and home
care. Care.com is an IAC company (NASDAQ: IAC).
View source
version on businesswire.com: https://www.businesswire.com/news/home/20230613495283/en/
Natasha Fellion Communications Manager, Care.com
natasha.fellion@care.com
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