Many families struggle to afford the weekly cost of childcare, but what they are asked to pay is always less than what it actually costs to run a daycare, ministry, or home. So how do we equalize these numbers? Good question. Parent affordability in relation to staff salaries and operating expenses is one of the most difficult challenges in child care. Noble County is soon launching a program to help eligible families better afford care. More on that in a moment.
In Indiana, the average cost of child care is about $12,000 per year for a single child. “Affordable” child care is defined as when a family spends 7% or less of their annual income on child care. This means that in Indiana, families earning $171,000 a year have access to affordable child care. According to the Northeast Indiana Regional Partnership, the average median income for a Northeast Indiana family is just over $61,000.
Locally, some daycares, ministries and homes are doing everything they can to keep costs down. But this has a price.
“At the moment, our tuition only covers about 80% of weekly expenses,” said Rita Steele, director of Lighthouse Childcare and Learning Service in Ligonier. “We are using our stabilization grant to cover the shortage. As our stabilization grant decreases, we are considering fundraisers to help make up the difference (we had stopped all fundraisers due to COVID).
Even with the low cost of tuition at Lighthouse, some parents can’t make their payments every week, Steele said. In addition to accepting Child Care Development Fund (CCDF) vouchers, Lighthouse offers multi-child discounts and scholarships to families who are struggling but do not qualify for CCDF.
“We’ve tried to keep tuition as low as possible, having only had ONE increase in the last ten years,” Steele said. “But it only resulted in a small pay rise for staff. I think it is important to note that the salaries we are able to pay are among the lowest in the region. The only reason most employees in the child care industry are able to survive is either to have a spouse with a salary that supports the family, or to have that as extra income, while receiving social security, disability or other assistance.
From 0 to 5 years old, child care providers have a profound impact on the development of our children.
“Most of the kids at Kendallville Daycare are here 8 to 12 hours a day, 5 days a week, so we’re no different than a third parent,” center director Tina Lee said.
Kendallville daycare staff are paid up to $18 an hour depending on education level, but that’s still below the average for many industries and well below the average kindergarten teacher’s salary. in 12th grade.
Like other businesses, child care centers have overhead costs in the form of staff salaries, meals for children, and utility bills. Staff usually only receive a salary – there are no additional benefits. The Kendallville Lighthouse and Daycare does not pay rent. KDCC owns their building, while Lighthouse is grateful to the church for allowing them to use the space for free. Even without this huge expense, child care is losing money every day.
After doing the math for her own center, Lee noted that KDCC loses $13.29 per day per child.
“We fundraise throughout the year, and we apply for grants, which helps make up some of the difference,” Lee said. “We have a money market account/savings/and some endowments — but it’s not much. We are basically breaking even, so not for profit.
Childcare is definitely a business that few investors want to touch. The economic model is crucial for our economy, but its sustainability is precarious from the start. A child care center currently renovating a space to open a new program is seeking funding now to help cover operating expenses when it opens next year. Another program told Noble Thrive by 5 that they would need two years of local operational support before deciding to move to the area to operate a daycare.
“At the end of the day, society at large needs to understand that our industry, early childhood education, is no different from the healthcare industry,” Lee said. “We all need ‘health care’ in one form or another to survive. Most humans need “childcare” in some form to work. Once society realizes the ‘cost’ and ‘work’ it takes to care for a child on a day-to-day basis, perhaps we will see a change in funding and salaries etc.
It really comes down to that local support. Child care centres, ministries and homes need local public and private support to survive. They are essential to keep employees coming to work, to educate our youngest children and to keep the economy going. With the support of Noble County Commissioners, Noble County is launching a Tri-Share program, the first of its kind in Indiana. Modeled after a similar program in Michigan, this pilot program will attract county and employer funds to support families. We are so grateful to the Noble County Commissioners for seeing the value and economic benefits of child care support for families! Find the preliminary details of this proposal here: https://noblethriveby5.org/noble-county-tri-share-proposal/. Some details may change as the program heads towards launch in early 2023.