Child care a financial burden, says Atlanta Fed

Working at home a way for women to stay in the workforce, researchers say
Rebecca Riley, who works as a marketing specialist for Mercedes-Benz Financial Services in Sandy Springs, leaves work after picking her children Sebastian, 3, and Ty, 7 months, up front the on-site daycare.   (Ben Gray / Ben@BenGray.com)

Credit: Ben Gray

Credit: Ben Gray

Rebecca Riley, who works as a marketing specialist for Mercedes-Benz Financial Services in Sandy Springs, leaves work after picking her children Sebastian, 3, and Ty, 7 months, up front the on-site daycare.   (Ben Gray / Ben@BenGray.com)

It’s not a niche issue: more than half the American workforce are parents and 34% of working parents in Georgia have young children.

That means that upwards of 1.8 million people in the state each day confront the often-competing demands of workplace and child care, the need to earn a living and the need to find — or provide — safe supervision for their kids.

“As employers endeavor to attract and retain a robust workforce, understanding potential barriers such as the cost of childcare becomes increasingly important,” wrote Brittany Birken, director and principal adviser in Community and Economic Development, and Herman Knopf, a visiting scholar in Community and Economic Development.

Some people bring children to relatives or relatively cheaper — and unlicensed — neighborhood outfits. While data is available only for the “above ground” operations, child care is a “significant financial commitment… particularly for families at the lower end of the income spectrum,” according to a paper released last week by the Federal Reserve Bank of Atlanta.

The Atlanta Fed focused on Florida, which has nearly the same share of workers with young children as Georgia.

For households of two adults taking home the state’s median income,child care for one young child on average snared 11% of their pay. Add an infant and the household would be paying 22%, the Fed found.

According to the Census Bureau, the median household income in Florida is $65,370 compared to Georgia’s median of $67,730. The median income nationally is $74,580.

At the low end, if the two adults are making Florida’s $12-an-hour minimum wage, they would average 16% of their income going to child care for one child and 38% if they add an infant, the Fed found.

Health issues often dog parents: If a child is sick, do the parents try to sneak them into their center, scramble for an alternative or do they lose a day of work? The day care centers, too, face a dilemma if they are being paid by a child’s attendance each day: Do they take a sick child and risk infection to others?

The pandemic-triggered increase in remote work — and the flexibility it provided — has been crucial to getting more women into the workforce and keeping them working, according to a related paper from the Brookings Institution.

About one-quarter of “prime-age” women — 25 to 54 — with children, were doing at least part of the work week at home last year, wrote Lauren Bauer, a fellow in economic studies, and Sarah Yu Wang, a research intern.

Well-educated women were nearly twice as likely to work at home, perhaps because they were also more likely to be in white-collar jobs.

The United States is the only developed country in the world without a universal paid maternity leave policy, they write.