A months-long study of a seven county region has concluded that a lack of available and affordable childcare is likely one contributing factor to why so many open jobs in Knox County, and across the state, remain unfilled.
“We knew there were gaps in childcare availability, but the report suggests we are 1,600 seats short of what is needed — and that’s just in Knox County,” said Chris Pfaff, CEO of Knox County Indiana Economic Development.
While that number is likely an overestimation — as it only includes licensed childcare centers in the study, as opposed to any in-home daycares or baby sitters — Pfaff says it’s clear the county is falling short of the childcare needed.
“It’s hard to get a handle on the number of in-home and unlicensed childcare providers, but even at that, I think the study validates what we all suspected — we are hundreds of seats short in Knox County,” he said.
The Southern Indiana Gateway Child Care Analysis, released in March, shows that adults with at least one child under the age of six have a labor force participation rate of 72.3%, meaning more than 1,700 parents of young children in the region are unemployed.
Locally, 450 people with young children are unemployed, but the report indicates that, in order for all these parents to have the option to begin working full time, SIG counties would need to increase full-time childcare access by more than 70%.
Knox County joined six other counties in Southwest Indiana last year in an effort to better understand possible gaps in the availability of childcare within the region.
The Southern Indiana Gateway Region is comprised of Crawford, Dubois, Orange, Perry, Pike and Spencer counties, and earned the designation of a 21st Century Talent Region in 2021, a state initiative that encourages regions to build and implement a plan to increase educational attainment, raise household income and grow its population.
The group, which includes each county’s local economic development organization and chamber of commerce, wanted to better understand the regional childcare landscape, particularly in terms of meeting the needs of working parents.
The region then partnered with Transform Consulting Group in an effort to collect accurate and up-to-date information on the number and types of childcare seats available within each county, specifically focusing on licensed daycare providers.
Lack of access to childcare has recently been recognized as a critical issue impacting workforce participation and attraction of new talent, especially in rural communities, which are often underserved in terms of licensed care centers.
Last year, Pfaff had been hearing more often from local business leaders that childcare was an issue for many employees. When he learned SIG was embarking on the comprehensive study, he asked that Knox County be included.
Though the concerns about Knox County childcare were anecdotal at the time, Pfaff said it seemed worthy of exploring more fully, particularly after childcare-related absenteeism among employees skyrocketed amid the COVID-19 pandemic.
While the report offers a sense of how much more childcare might be needed in Knox County, what it can’t answer is how many people would seek work if it was more financially viable for them to do so.
“If you’re not earning a certain amount, it just doesn’t make sense to go back to work — if you’re paying more in childcare than you are earning,” said Pfaff, adding that “childcare is expensive.”
According to the 2021 Child Care Affordability Analysis, the average tuition price for full-time center-based care in Indiana is more than $10,000 for toddlers and over $11,500 for infants.
While Indiana offers a voucher program to help offset the costs of such expenses, a single parent with one child has a pre-tax monthly income limit of $1,938 ($23,256 per year) to be eligible for the program. That translates to $11.18 per hour, for 40 hours of work per week.
The limitations leave many individuals in a difficult bind, because taking a job that offers as little as $11.50 per hour could eliminate any chance of financial assistance.
In the report, researchers noted that “basic living expenses,” such as housing, are currently high, adding that “if families cannot afford child care on top of all their other expenses, one parent may decide they have to stay home rather than join the workforce.”
Too, the report found that low wages for childcare professionals could be a barrier in generating more open seats for young children.
According to the SIG study, “Indiana child care professionals with a bachelor’s degree were paid over one third (35%) less on average than educators teaching children K-8,” with the median hourly wage of preschool teachers sitting at $12.84.
The findings also suggested that early care and education employers may be facing competition from neighboring states, as pay in Indiana is considerably lower than in nearby states, such as Illinois.
Employers, and the state, also take economic hits from the childcare crisis.
According to a report published by Indiana University in 2018, childcare-related absences and turnover directly cost Indiana employers $1.8 billion annually.
The same study found that Indiana lost nearly $1.1 billion in annual economic activity as a direct result of inadequate care for children.
Pfaff describes the current dilemma as a “wicked problem.”
“It’s wicked because it’s so complex, there are no easy solutions.
“Childcare is not a profit-making endeavor, it just isn’t, so without some support and sustainment from various institutions, it’s just very difficult,” he said.
However, Pfaff adds, there is hope for change on the horizon.
“The good news is that we’ve got all the right folks at the table getting a deeper understanding of our gaps and thinking about how we start to resolve this issue,” he said.
Some of the those participating in the discussions, include leaders from Good Samaritan Hospital, the Vincennes Community School Corp., KCARC, and Vincennes University, and help comprise the Knox County Childcare Task Force.
Pfaff says they are starting to explore everything from a College and Community Collaboration grant, funded by Lilly Endowment dollars to a variety of state initiatives.
Historic, one-time funding from the new Hoosier Enduring Legacy Program (HELP) will also be utilized, in part, to address the childcare needs of Knox County.
The HELP plan proposes a $500,000 investment in childcare and pre-kindergarten programming, via partnerships with the VCSC, KCARC, and the YMCA.
Vincennes is one of a select group of Indiana cities or counties to be designated as a 2022 HELP community, which provides $1 million dollars to improve quality of life, particularly segments that were made worse as a result of the pandemic.
“With these various funding opportunities, I think we may be able to help address this issue” says Pfaff, “ But it will take a community effort.”
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