Report: Minnesota has the third highest average cost of infant child care in the country

NINA MOINI: A new report has found the average cost of infant child care in Minnesota is the third highest in the country. That's according to the Economic Policy Institute. The average cost is $22,000 per year. That's 18% of a median family's income in Minnesota.

But as with many reports, we found there's some nuance behind these numbers. So joining us to explain is Ann McCully the Executive Director of Child Care Aware Minnesota. Ann, thanks so much for being with us this afternoon.

ANN MCCULLY: Well, thanks so much for having me, Nina.

NINA MOINI: For starters, Ann, would you tell us just a little bit about what Child Care Aware does and why this is all on your radar?

ANN MCCULLY: Absolutely. So Child Care Aware of Minnesota I often describe as the infrastructure organization. We, plus 14 of our local agencies around the state, really are there to do everything from helping parents find child care, understanding their options. We have our both online search as well as referral counselors to help people understand and get information about available childcare.

And then we do a lot of work in the space of helping our early educators, our teachers, our family, childcare providers get the education, the training, the scholarships, the grants that they need in order to stay in business. And then, finally, we do track legislative and other policy issues that impact that community.

NINA MOINI: OK. And I'm sure all those resources are much needed. I'm talking about, again, just want to reiterate that the report found that the cost of infant child care in Minnesota, third highest in the country. What was your reaction when you heard that?

ANN MCCULLY: Well, we do, both for our national office and through other agencies and organizations, often see these types of reports. What I like to point out to folks is not to, of course, disparage ever any kind of report that tries to give an average, right, but what we have to remember, especially in a state like Minnesota, where we have such a range of settings-- so we have small licensed family child care homes all the way to large child care centers.

And, depending on both what type of care you use and where you live in the state, those costs can look very different. So when we hear $22,000, again, being an average, what we're averaging could be everything from in a very small rural area of Minnesota, particularly if someone is using licensed family child care for an infant-- that could be as low as $7 to $10,000.

But you get into the most high cost metro areas, where cost of living, and cost of wages, and all those things are higher, and you might see upwards of $26,000. So I always say this because I hate to have parents sitting there sticker shock going, oh, my gosh, in my small community, I'm going to pay $22,000-- that may not all be the case.

NINA MOINI: Sure. Oh, it's so important to dive in, because I can see families sitting there thinking, how are we going to do this? No matter really what the cost is. Can you explain a little more about just the different types of childcare. You were saying it can really range pricing wise-- bigger or smaller. What are some of the options for Minnesota families?

ANN MCCULLY: Sure. First of all, what I want to say at the beginning is that it's really, really important to us and, I think, to most families, and to the community that there's a range of choices. Not every child is the same.

So, you know, when I speak of licensed family child care, that's often in a home or a home-like setting. The big piece there is that it's mixed ages. So it might be a few infants, a few toddlers, some school aged children.

And it's very much that. So for some families to have their child or to have, if they've got multiple children of more than one age, to be able to use that type of setting can be very, very important.

NINA MOINI: Sure.

ANN MCCULLY: Childcare centers, which you tend to think of as the licensed child care center, sort of the standalone, that tends to be grouped by age. So the infants you're speaking of would be in their own room, the toddlers, the preschoolers, et cetera. And then, of course, we see lots of things like, increasingly, we're seeing schools offering preschool.

And to us, I always say pre-K is not a setting, it's an age, especially when we get into those ages. And, occasionally, we've had schools branch out into offering younger children care. And Head Start is another option for families. So we have a lot of different settings.

And, really, what it comes down to, as I said, is the family's own desire to meet the needs of their child. And, of course, cost and location come into it as well.

NINA MOINI: Sure. And, correct me if I'm wrong, but in the report, family child care for Minnesota ranked 47th. So there was a really big difference in what it was going to cost people. So it's important to break that down. What impacts how much childcare costs within our state? What are some of the different factors that would contribute to that?

ANN MCCULLY: Well, this is definitely the conversation, right? Because both in the community, at the legislature, everywhere is like, what are we going to do about these costs and why are they so high? And there's definitely conversation about some of the ways we can, perhaps, reduce and streamline some of the regulations. That will help.

But I always say we can't deregulate our way out of this because, really, the majority of the cost is, if it's a childcare center, it's staffing. And if it's family child care, of course, we want folks who are primarily independent businesses to be able to make a living. And so when you consider, first of all, people maybe forget sometimes about all the regular costs that would go into any program-- there's food, there's energy, there's often transportation, there's either rent or property increase, or property taxes, or payments.

So those all have to factor in. But staffing, absolutely. And why that lends to the cost, and especially in a state of Minnesota like Minnesota, where we've been very proud of keeping those, what we call ratios, low.

So if we want to focus on infants, right now in Minnesota, you can have no more than four infants to one teacher. There are states that do more than that. Some people try to keep it to one to three.

And we like that for two reasons. Number one, obviously, the very basic health and safety. How are you going to have one teacher with four, or five, or more infants in an event of an emergency? But actually, almost more importantly, the early education research that people have done, we know that that ability to spend one-on-one time with a young infant and do what we call serve and return where they're babbling at you and you babble back to them, those are so important.

So keeping those ratios low also means that we have to have multiple teachers during the course of a day. And even though these folks are making maybe $16 an hour, we're not going to see anybody making the math work, unfortunately.

NINA MOINI: Ann, I'm curious, what is the state of staffing when it comes to childcare? I feel like over the course of the past five years and since the pandemic, there's just been a lot of burnout in certain industries. Is this among them? How's staffing going?

ANN MCCULLY: We're seeing two things happen that impact that question. First of all, we've seen a fairly steady decrease in our licensed family child care homes. Now, this is not unique to Minnesota. And this did begin before the pandemic.

What I often talk about is that historically, we've had a lot of churn in that community because people may intentionally start a family child care home, particularly when their children are young. And then as they grow, then they'll leave that field and going on to something else.

But what's usually happened in the past is that new people have come in and replaced them. What we're seeing now is people are still leaving, but we're not seeing this next generation of folks necessarily replace them.

So steady decrease there, which is comparable to staffing. And then the center space, of course, post-COVID, especially, when you started seeing other companies and industries have to raise their wages, it was difficult, of course, for childcare to do that.

And we lost a lot of people to other types of jobs, which, frankly, came with benefits, another thing you don't always see in childcare. And we've had, again, trouble-- we hear stories all the time from our childcare centers out there that the demand from parents is growing, but they cannot find staff. So they can't open, for instance, a classroom, or, worse yet, they have to close their program.

NINA MOINI: Sure. So lots of moving parts here and different stakeholders. Is there a lot of help available for families to make childcare more affordable? I'm thinking specifically of who would be considered a middle income family, because a lot of people are struggling more than they have before.

We hear about how expensive the cost of living is and everything. I could see a lot of people feeling like things are tighter than they used to be. What's the range of scholarships and help that's available?

ANN MCCULLY: Sure. Well, the running, if you will, form of support for Minnesotans and people around the country has been in the form of child care assistance. But that program generally is meant for our fairly low income families. And it has had its own struggles with getting funded the way it should and could.

Several years ago, Minnesota added the Early Learning Scholarship Fund, which can go a little bit further in terms of breadth in terms of who it can cover. But, again, that's under threat this year in terms of funding. So what we really have as a goal in Minnesota, and this language was added a couple of years ago, and I believe it's even cited in that report, is we want to move to a point where no family in Minnesota is paying more than 7% of their income. But, of course, what that's going to take is government and other private investment to get us there.

NINA MOINI: Ann, thank you so much for coming on and providing some much needed perspective. I learned a lot. I really appreciate your time.

ANN MCCULLY: Well, thank you so very much, Nina.

NINA MOINI: That was Ann McCully, who is the Executive Director for Child Care Aware Minnesota.