Child Care Faces Threat as Funding for Centers Expires
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Here's your money briefing for Monday, October 2nd. I'm J.R. Whalen for The Wall Street Journal. For many parents, childcare is a lifeline that frees them up to work and not have to worry about their kids during the day. But it can also squeeze their household budgets. To make matters worse, over the weekend, federal funds subsidizing tens of thousands of childcare centers began to dry up.
It's been apparent for some time that no new funding was coming into place. And so rather than everyone just charge off this cliff, places have been getting ready. A lot of child care centers have already begun raising rates or making staffing decisions in anticipation of the federal funding going away.
We'll talk to Wall Street Journal columnist Josh Zimbrun about what this means for child care going forward after the break.
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70,000 child care centers around the country and roughly 3.2 million children could be affected as federal child care funding has run out. What can families with children expect? Wall Street Journal numbers columnist Josh Zimbrin joins me. So, Josh, why did federal funding for child care end on September 30th?
If you have a kid in childcare, there's a pretty good chance you've encountered this, that the third big stimulus package that the government passed during the pandemic included $24 billion for childcare spending. It went to childcare centers, it went to family childcares, and it was a very significant lifeline for the industry during that kind of later pandemic period.
What is the funding deadline and why does federal child-care support expire on September 30?
And it was set to expire September 30th at the end of the government's fiscal year. And so it's over now. And so the question is, what's going to happen to all of these centers that serve so many kids when they no longer have this extra boost of funding?
Has there been any talk of more federal funding coming down the pipe?
There's proposals that are out there from Democratic senators. And the original idea was that you would do this temporary boost in the pandemic program, and then you would come in with kind of like a permanent child care program. And they've never gotten to any sort of consensus on how exactly to do that. So although the idea is out there, there's senators and congressmen that are very passionate about the idea. It's not really something that seems to be close to coming into place. And so The situation for now is that the temporary pandemic program is over, and there's not a big new program to come in to fill that hole of what's going to be missing.
What kind of an effect could the current situation have on families?
One of the things that's gotten so much attention, and it was kind of what we were looking at when we wrote this column, was there's this estimate out there that... As many as 70,000 childcare centers are likely to close and that 3.2 million children could lose their slots. Those are some numbers that everyone has latched onto. But I think they're actually very dire to the point that even the authors of that estimate, they've described it as the childcare cliff.
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