BY FREDA MIKLIN
On July 19, Common Sense Institute (CSI) and Executives Partnering to Invest in Children (EPIC) presented a panel discussion on, “The growing strain on the childcare business model and economic impacts and opportunities for improving affordability and accessibility.” Luige del Puerto, editor of Colorado Politics and Denver Gazette moderated.
Kristin Strohm, CSI president and CEO began the conversation by pointing out that, as the pandemic began, “4.5 million working moms left the workforce.” Although there has been a significant recovery, she explained, “There are 43,581 fewer women working today than there would be if Colorado’s May 2022 labor force participation was the same as it was before the pandemic,” adding, “We are down, across the state, over 425 childcare facilities, there is a gap of about 95,000 children who need care that families can’t get, and to top it off, Colorado has the 8th highest childcare cost in the nation. On average, families in Colorado are spending nearly 20% of their income on childcare…It is not sustainable. We are in urgent need of reform.”
Colin Stewart, who owns and operates an educational startup offering a STEM-based curriculum to infants, toddlers, and preschoolers, explained, “I have a large childcare center in Castle Rock. We have a capacity of 164 students. We are at 75% capacity at the moment. Demand is very strong. Staffing, training, and productivity are our biggest challenges. Before the pandemic, productivity was much higher, even though we have given substantial pay raises. The cost of labor has increased 25% to 30% and “callouts” are 10% to 20 % of our staff daily for any variety of reasons, including COVID.”
When the moderator asked why hiring is difficult, Stewart explained that before the pandemic, he paid his employees $15 to $17/hour. Now he pays “north of $20/hour,” but so do fast-food restaurants. He explained, “There are more jobs than there are employees looking for jobs,” so employees are not committed to keeping jobs because they can always find others.
Patrick Meyers, executive director of the Colorado Office of Economic Development and International Trade and Colorado Chief Economic Recovery Officer, agreed, explaining, “In the United States, we have two open jobs for every unemployed worker. There is a geographic and skills mismatch…We see it mostly in hospitality, health care, and childcare. There are 8%, or 1300 fewer childcare workers in Colorado alone than pre-pandemic,” adding, “Our labor force participation rate for women is significantly less than for men and we think one of the predominant factors in that is the lack of childcare.”
The moderator asked Tawny Espinoza, vice-president of community development at Community Hospital in Grand Junction, about childcare in her city. She said, “A few years ago we determined that our area, including the City of Grand Junction, was 4,000 childcare slots short. We knew that waiting list times were sometimes up to a year and a half and affordability was astronomical. We also knew that when some of our lower wage earners had to spend almost half their income on childcare, they decided to leave the work force.” She continued, “We are now building an onsite childcare center that will have 100 childcare slots. Our employees will have the first right of refusal for those slots. Any remaining slots will be opened to the community. We are also working with our foundation to create an endowment so we can have sliding fee scales for our lower wage earners…We say our facility is “in our back yard,” on the south side of our campus.”
Jansen Tidmore from the Jefferson County Economic Development Corporation, said that his organization has observed that households must decide the value of their jobs compared to the cost of childcare, noting that, in 2020, five percent of workers in Jefferson County quit their jobs. He added that some females are coming back but not at the level at which they left, which, “impacts our ability to create more jobs and bring in more companies.”
HD22 Rep. Colin Larson shared that, “Creation of the Office of Early Childhood Education in state government was a watershed moment… There’s a tremendous workforce need as well as a potential upside for K-12 preparedness and early literacy…The data is very compelling…There should be a tremendous amount of money available vis-a-vis the nicotine tax that was passed by voters in the last election to hopefully address some of these staffing issues…Hopefully, there will be a better infrastructure pipeline for getting people trained and properly credentialed… so they can get in the door…and in the work force.”
DelPuerto said he believed that $465 million has gone into childcare investment and that Governor Polis has allocated an addition $100 million to the industry. He asked Nicole Riehl, president and CEO of Executives Partnering to Invest in Children (EPIC) what that might mean.
She responded, “We saw some landmark investments and legislation this year to support early care and education. The $100 million that came from the economic recovery task force (could) help keep childcare businesses afloat…Some of the funding (was used) to support the development of new childcare facilities across the state.” She added that Colorado also invested in informal childcare by friends and neighbors, providing resources for training for those people.
Riehl pointed to the fact that, “Brain development is at its height in the first five years of life, so childcare is an important job,” noting that when she was an early childhood worker, she could not pay her bills with her salary.
Tidmore summarized the problem, explaining that there is a high cost to providing quality childcare and, “The math for this model is broken…There is a tax incentive for the K-12 system…We should look at childcare as a benefit… We have a mathematical problem when it comes to childcare and how we align our expectations with what we receive to get people back into the workforce.”