INDIANAPOLIS — As the state and nation recover from the economic fallout of COVID-19, millions of workers have left their jobs, and companies across the country have resorted to sign-on bonuses and other incentives to recruit much-needed help. But not every industry can increase wages, meaning that vitally important fields such as the child care sector continue to lag behind.
For Rep. Terri Austin, D-Anderson, the reason for the sluggish return to work is clear: The lack of options in Indiana has kept thousands of Hoosiers, particularly women, from returning to the workforce.
“Those of you who have children and infants probably know this already, but it actually is more expensive to care for an infant than it is for a year of tuition at a four-year public institution,” Austin said at a November event.
During the pandemic, child care costs increased. Families can now expect to pay $11,208 for center-based care or $14,004 for home-based care, according to a report from the Center for American Progress, a nonpartisan policy institute.
Tuition for an in-state student costs $11,332 at Indiana University and $9,992 at Purdue University.
“We’ve got to help women back into the workforce; they have dropped out because of the child care shortage,” Austin said. “If we’re serious, we should take some of our reserves … and figure out how we can help small businesses and help women back into the workforce.”
Indiana reported an eye-popping reserve of $5.1 billion at the end of the 2021 fiscal year, and House Republicans have announced their 2022 push for tax cuts.
An estimated three million women left the workforce during the chaotic economic downturn of the pandemic. Some had their hours cut involuntarily while others made the difficult decision to stay home and care for children as schools and child care centers shuttered across the country.
Workers, including those parents pushed out of the workforce by child care closures, are sluggish to return to their jobs, with Indiana at one time reporting more than one open job for each unemployed resident.
“Families are finding a whole host of different ways to make ends meet, including mothers jumping out of the workforce because they simply can’t find a way to make it work,” said Jessica Calarco, an associate professor of sociology at Indiana University.
“It often feels like the money that (the mother) would be earning … the difference between that and the amount they would be paying in child care is so small.”
Calarco started a longitudinal study following 250 Southern Indiana families during their first couple of years with children shortly before the pandemic, enabling her team to see firsthand the impact of COVID-19 on working families and mothers.
HIGH COSTS; LOW WAGES
Despite the high costs for families, wages for child care workers in Indiana are among the lowest in the nation. Most positions don’t offer benefits, and many workers rely on government subsidies to survive.
The median pay nationally for child care workers in 2020 was $25,460 per year, or $12.24 per hour, according to the U.S. Bureau of Labor Statistics. Indiana’s child care workers earn $22,790 annually, trailing three-quarters of other states.
In Indiana, roughly 23% of child care workers live in poverty, compared to 11% of the overall population, according to the Center for the Study of Child Care Employment.
“The existing early care and education system does a disservice to the educators – largely women and often women of color – who nurture and facilitate learning for millions of the nation’s younger children every day,” the report said.
“Despite their important, complex labor, early educators’ working conditions undermine their well-being and create devastating financial insecurity well into retirement age.”
Becky Albano-Miller, co-owner and operator of Pixie Playhouse in Lebanon, said business was harder now than it was when her mother started the child care center 60 years ago. Enrollment had to be capped around 60 based on available teachers. The facility is otherwise equipped to serve as many as 115 children.
“We have seven employees — six teachers and one in the kitchen — and that’s low for us,” Albano-Miller said.
Pay for employees starts at $16 per hour.
“And that’s our minimum because, gosh, you can work at McDonald’s for $15,” she noted.
WHERE ARE THE WORKERS?
Even at that rate, higher than the industry average and more than twice the state minimum wage of $7.25, Albano-Miller’s employees make 38% less than the area’s median wage of $52,030. Before taxes, Pixie Playhouse workers earn about $32,000 annually.
In a Washington Post story published in September, analysis showed that child care providers struggled to fill vacant positions more than their restaurant peers, whose staff shortages dominated headlines. And more than one-third of child care workers were considering whether to quit, according to the National Association for the Education of Young Children.
In recent years, the problem of low pay and nonexistent benefits hasn’t improved, based on a 2019 Workforce Study from the Indiana Association for the Education of Young Children.
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