Gov. Evers, DCF Announce New Survey Finds Child Care Industry Unable to Serve 33,000 Kids Due to Lack of Staff

“Working parents across our state depend on having high-quality, affordable child care so they can get to work and feed their families, but with providers closing their doors and reducing slots due to staffing, affordable child care is becoming harder and harder to find,” said Gov. Evers. “This is not sustainable. If we want to address our state’s generational workforce challenges, we must make sure child care centers have the resources they need to keep their doors open, pay their staff fairly, and serve as many kids as possible. It’s as simple as that.”

“The fully-funded Child Care Counts Program provided crucial support for child care providers to avoid big tuition increases while recruiting and retaining qualified staff,” said DCF Secretary Jeff Pertl. “Unfortunately, part of the large workforce shortage that we are seeing in this survey is a ripple effect of the Child Care Counts payments being cut in half and a preview of what we can expect should the program not receive state funding.”

Due to razor-thin margins, Wisconsin child care centers are only able to pay lead teachers an average of $13.55 per hour, which is less than half of the average hourly wage of $28.34 for Wisconsin workers. Unlivable wages, combined with few or no benefits, are causing qualified early care and education professionals to leave the field. With a lack of staff, child care providers are stuck closing more classrooms and serving fewer kids while watching their waitlists grow. Providers reported in the survey that a total of 48,000 kids are on waitlists in Wisconsin.

Raising rates is difficult for child care providers as families are already struggling to pay the current prices. A report released from Forward Analytics highlighted that the average cost for newborn care in Wisconsin was between $10,400 and $13,572 annually in 2021. The report also shows that child care costs can consume up to 36 percent of a family’s household income for parents under the age of 25 at the median income and 18 percent for parents between 25 and 44 at the median income. For a typical family with parents under 25, child care costs can reach as high as 70 percent of the household’s income for two children in care. All told, the report highlights that the cost of child care for two young children in Wisconsin is now more than the average rent or mortgage and exceeds the annual cost of tuition to send two students to the University of Wisconsin-Madison. Unlike college, there are no loans for child care, and services are paid for in cash, up-front at a time when families are just starting out. However, the price families pay doesn’t come close to the average true cost of $33,715 per year to care for an infant, which is what providers would need to pay their staff fairly and cover all expenses of running their business.

To increase capacity and reduce waitlists, a long-term investment in the well-established, successful Child Care Counts Program is needed. Launched in 2020 via federal relief dollars, the program has delivered over $750 million in upstream support to child care providers to increase wages, provide benefits, expand access, and more. It has helped more than 5,314 child care providers keep their doors open, ensuring the employment of 64,533 child care professionals and allowing providers to continue care for more than 364,280 kids. According to a report from The Century Foundation, without additional continued investments, 2,110 child care programs are projected to close, resulting in over 87,000 children without child care in Wisconsin and the loss of over 4,880 child care jobs. Additionally, the lack of access to child care could potentially cause about half a billion dollars in economic impacts across the state.

“The Child Care Counts Program has helped to keep our center in business and fully operational as we were able to retain staff with bonuses and wage increases as well as lure new staff members with sign-on bonuses,” said a Wisconsin child care provider.

ADDITIONAL BACKGROUND ON GOV. EVERS’ EFFORTS TO SUPPORT CHILD CARE COUNTS

Gov. Evers’ 2023-25 budget proposal included making the Child Care Counts Program a permanent state program with a more than $340 million investment to help keep Wisconsin workers in the workforce, expand access to affordable child care for working families, and support early care and education providers. This funding, along with many other budget investments to support working families, was ultimately removed from the final budget by Republicans in the Wisconsin State Legislature.

Additionally, Gov. Evers has repeatedly called on the Legislature to pass his comprehensive workforce plan, which would stabilize Wisconsin’s child care industry and prevent its collapse, among other issues facing Wisconsin’s workforce. Similar to his original budget proposal, Gov. Evers’ comprehensive workforce plan would have provided more than $340 million for the Child Care Counts Program. After months of Republicans delaying action on Gov. Evers’ comprehensive workforce plan to help keep child care provider doors open and provide direct investments designed to immediately help parents afford child care, Gov. Evers directed $170 million in emergency stopgap funding to DCF to continue the Child Care Counts Program at current funding levels through June 2025.

In May, Gov. Evers and the Wisconsin Economic Development Corporation (WEDC) also submitted a formal s. 13.10 request to the Republican-controlled Joint Committee on Finance (JFC) to release $15 million aimed at supporting child care providers and working families across Wisconsin that was included in the 2023-25 biennial budget signed by the governor. Under the submitted request, the $15 million would be directed to support the successful Child Care Counts Program in partnership with DCF. Unfortunately, the Republican-controlled JFC has refused to release this already-approved funding despite more than a year passing since this funding was signed into law.