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Closing The Gap

U.S. parents lost $35 billion by staying home with their kids—the coronavirus pandemic could make it worse


For some parents, the choice between working or staying home to take care of their kids comes down to a simple equation: Can I make more than I spend on child care?

And sometimes the math just doesn't add up. Among millennials (ages 24 to 39), 38% say their primary child care is one parent staying home with the kids, according to a recent CNBC Make It survey conducted by YouGov of nearly 4,000 U.S. adults, almost 400 of which were millennial parents with at least one child under the age of 10. 

Yet making the decision to quit your job or reduce your hours, even temporarily, has long-term economic repercussions: American parents forgo tens of billions in lost income every year when they drop out of the workforce or reduce their hours to care for their kids, according to a report published earlier this year from the progressive think tank Economic Policy Institute.

With many day cares, preschools and schools at risk of closing permanently and unemployment spiking as a result of the coronavirus pandemic, experts fear more parents, and women in particular, may opt to stay at home and ultimately drive up the indirect cost of child care to American families. 

As it is, 60% of parents in the U.S. have had no outside help caring for their children during the coronavirus pandemic, according to a new survey from Boston Consulting Group. And the Center for American Progress estimates that the U.S. could lose up to 4.5 million child-care slots if child-care providers can't weather the shutdown. 

"Parents, especially women, will not have the care they need to go back to work or school, employers will be unable to restart without workers and our economic recovery will be jeopardized," says Catherine White, director of child care and early learning for the National Women's Law Center.

Families left to make tough choices

Even before the coronavirus pandemic shut down their private day-care center in Ohio, Elizabeth Smith, 37, and her husband relied on a patchwork system to ensure their 3-year-old son and nearly 12-month-old daughter had care. 

Smith, a nurse, works part-time, and her husband, a banking analyst, works full-time from their home near Cleveland. When her son was younger, Smith's mom would watch him on days Smith had to work. "But as she's gotten older, and he's gotten more energetic, it's harder for her," Smith says. The couple opted to send their son to day care three days a week, but kept their daughter at home since she was still young enough for her husband to watch when Smith had to work. 

But then the coronavirus pandemic hit, forcing Smith's day care to close the second week of March. "The parents had to find alternative care," Smith says, adding that the day-care center still charged the Smiths full tuition, about $600, for March and April to help cover costs and pay staff.

For this figure, the Center for American Progress examined survey responses from parents who stated that their primary care reason for seeking child care was to provide care while a parent was at work or school.
Source: An analysis by the Center for American Progress of the 2016 National Household Education Survey: Early Childhood Program Participation Survey from the National Center Center for Education Statistics

"I obviously can't work at home," Smith says, so for the two days a week she's at work, her husband is holding down the fort. "For my's very difficult for him trying to work and be productive, but also taking care of an almost one-year-old and a three-year-old," she says. "He ends up doing some work at night."

Although Ohio is allowing day cares to reopen at the end of May, Smith says she'll keep both kids home through the summer. In September, the couple is hoping to send their son to a local preschool, rather than pay to send him to their current child-care center's private program.  

If that's even an option. "If they're requiring children to wear masks in school, I'll just keep him home until it's OK, and I'll do homeschooling essentially," Smith says, adding that it's hard to imagine her little boy wearing a mask all morning.

In order to keep her kids at home, Smith is shifting to a PRN schedule at work this summer, which means she'll only work when needed. That way, she'll be at home to watch her son and daughter while her husband works. And even if her son starts preschool in fall, Smith says for now, she plans to continue to work PRN to take care of her daughter, who is getting old enough to need more constant supervision. 

When child care is a struggle, mothers carry the burden

Like Smith, about 17% of U.S. mothers with children were employed part-time last year, according to a Pew Research Center analysis of Census Bureau Current Population Survey data. And for many women, the reason they work part-time is directly tied to the fact that they need an affordable child-care option. 

Parents working part-time, or not at all, ends up costing American families $35 billion a year in lost wages, the EPI study found. This loss of potential earnings occurs across the income spectrum — it's not limited to low-income households, says Elise Gould, an author of the study and a senior economist with EPI.

Married women tend to see the highest indirect hit to their income because more have the option to stay home if their spouse works and brings in income, Gould adds. Single mothers, on the other hand, are less likely to opt out of work, but some may have to settle for less-than-optimal early care and education for their kids since they may not be able to afford higher quality, Gould says.

When child care is hard to find or very expensive, mothers are more likely to give up their jobs more than men, CAP found. The organization studied families in Washington D.C., which began offering free universal public preschool in 2009, finding that labor force participation rates among mothers with young children attending pre-K increased by 12 percentage points following the introduction of the program.

Note: positive numbers in the chart indicate that the labor group was hit disproportionately hard by job losses.
St. Louis Federal Reserve

Right now, women's jobs are being impacted by the pandemic more than men. In April, the unemployment rate was 13.0 percent for adult men, but 15.5 percent for adult women, according to the Bureau of Labor Statistics. In fact, Ana Hernández Kent, a policy analyst for the St. Louis Federal Reserve, says women have been hit harder by unemployment loss during the pandemic than expected and certainly harder than men. 

Many working mothers have suffered a one-two punch of no job and no child care, which will make it more difficult to return to work. Ultimately, it may lead many women to decide that there's no reason to go back to work because they can't find a job that will cover the cost of care.

 "If child care becomes extremely difficult to find, we're really going to see the impact on moms' employment," says Katie Hamm, CAP's vice president of early childhood policy. "I worry that we'll see a big decline in mother's labor force participation, and that will impact the economy as a whole."

Don't miss more in this series: 

Kids can't be an 'afterthought': Some states are reopening without lifting child-care restrictions

Many child-care facilities aren't accepting kids, but for some parents, the bills keep coming

Democrats earmark $7 billion for child care in newest relief package—but it won't be enough to stabilize the system for long

Affordable child care is increasingly difficult to find in the U.S.—coronavirus could make it harder

Why child care is so expensive in America
Why child care is so expensive in America