Report: Child Care Costs More Than College and Rent in Some States

Friday, 08 Nov 2013 10:08 AM

By Michelle Smith

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Child care costs are soaring. Last year, in over half the nation's states, it was more expensive to send an infant to daycare than to send a child to a four-year public college, a new report from Child Care Aware of America shows.

On average, in 2012, child care costs rose about 3 percent across the nation. But in actuality, there is a huge disparity between the actual costs parents are paying depending where they live.

Last year, the average cost of full-time center-based child care for an infant was $4,863 in Mississippi and $16,430 a year in Massachusetts, according to the report.

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That's up from about $4,600 in Mississippi and $15,000 in Massachusetts in 2011.

The difference in costs between states is due, in part, to the fact that some states have stricter regulations. For example, CNNMoney notes, a child care center in Massachusetts must have one teacher for every three infants. Mississippi's laxer regulations permit one teacher per five infants.

Child care centers are also grappling with ballooning operational costs, ranging from rising insurance costs to higher food prices, Lynette Fraga, Child Care Aware's executive director, tells CNNMoney.

And as the cost of the child care rises, it is taking an increasingly large chunk out of family budgets.

Child care and education now consumes 18 percent of a family's budget, according to Department of Agriculture data cited by Child Care Aware. It's an expense that overshadows food and healthcare and all other household expenses, except housing.

In addition, center-based child care fees for an infant exceeded annual median rent payments in 21 states and the District of Columbia.

These costs are becoming increasingly problematic, as they are vastly outpacing income growth, Child Care Aware notes. In the last year, the cost of child care increased at up to eight times the rate of increases in family income.

Nearly 11 million children under the age of 5 need child care services, but there are not enough government subsidies to go around, the report states.

Some parents are left relying on non-licensed child care. These services are cheaper, but aren't held to the same health and safety standards, and this raises questions about the welfare of children receiving unregulated care, Fraga explains.

The sequester and federal budget cuts "threaten to make an already strained situation worse," the report says.

"Quality child care isn't just an investment in children, but an investment in the working families who support the national economy," Fraga adds.

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