When the pandemic hit, child care was one of the first sectors in crisis. But action in the form of federal aid and swift state program implementation prevented widespread program closures. The nearly $600 million Utah received in federal child care funds helped stabilize the historically struggling sector and defied national trends by expanding the number of child care slots available. This substantial funding is estimated to have supported child care services for over 85,200 children in Utah.

As federal COVID-era funds begin to wind down, child care providers and the parents they serve are looking to elected officials to ensure that the sector doesn’t immediately fall back into total crisis. Child Care Stabilization Grants, a key program of the funding, are currently playing a vital role in enabling child care providers to stay open, keep costs down for families, and raise wages in an industry that has been long plagued by inadequate compensation. Unfortunately, the lack of commitment from federal, state, or local governments to sustain these successful programs with new funding means most COVID-era programs will end, ultimately leaving parents with ballooning child care costs, and abandoning child care providers to navigate a broken system.

Starting in October, Utah families will begin to experience the impact of the child care funding cliff.

What change is happening this fall?

As federal funding runs out, Utah’s Office of Child Care (OCC) will reduce monthly Child Care Stabilization grant amounts by 75% in October. By June 2024, the grants will end entirely.

How will this change impact Utah providers and families?

Providers are preparing now for the impending grant reductions. For example, PC Tots, a program in Park City, already announced tuition increases due to a funding gap of $620,000 from the loss of ARPA money. One family reported a $1,000 monthly tuition increase for their two children enrolled in PC Tots, highlighting the financial strain this poses for many families.

The wind-down and ultimate end of stabilization grants also presents additional concerns for providers. When surveyed, 36.7% providers anticipate being unable to sustain wage increases for their child care staff or, in some cases, will have to cut wages. Without intervention, this will likely to lead to higher turnover rates among child care staff, resulting in more disruptions in care for families and a further reduction in available child care slots, statewide, due to understaffing.

How will the end of stabilization grants impact Utah's child care sector?

A recent report from The Century Foundation identified Utah as one of six states where half or more of all licensed child care programs statewide could close, without new funding to replace the federal support.

Their analysis estimates that in Utah:

• 35,614 children will lose access to child care.
• 663 child care programs will be forced to close their doors.
• Parents will experience a collective loss of $101 million in earnings.
• 1,304 child care jobs will be lost.

Deep, structural problems within the child care system existed well before the COVID pandemic; those problems will persist and worsen when COVID-era funding runs out. With 77% of Utahns living in child care deserts, parents already allocating 14-25% of their income on care, and providers making less than animal caretakers, we can’t afford to reduce our investment in child care. The child care market faces new challenges too. The current robust job market has made it increasingly difficult for child care providers to compete for good employees. And inflation has caused the cost of normal expenses to skyrocket for families. 

As we look towards the fall, parents and providers should prepare for these difficulties. But also, state and local policymakers need to pay attention and ask what they can do to mitigate a new child care crisis. 

This blog post is part of a series of blog posts examining Utah's child care funding cliff. You can find the other posts here:

• Utah's Child Care Crisis is About to Hit a Whole New Level
• How Much Will Each Utah County Soon Lose in Child Care Funding?
• What Happened with Child Care During the Legislative Session?

To learn more about our initiative to invest in child care, go to UtahCareforKids.org. 

Utah’s family demographics have changed. 53% of Utah families have all available parents in the workforce, making child care a necessity. These days, most Utah families need two incomes to maintain financial stability. But Utah’s licensed child care system struggles to meet the demand. Licensed child care program capacity is only sufficient to serve about 36% of all children under six whose parents are working.

To provide a comprehensive picture of Utah's current child care crisis, this report produced by Voices for Utah Children examines the availability of licensed child care across the state, and in each individual county. By conducting a detailed analysis of both the demand and supply of child care services, the report aims to provide policymakers and the public with a clear understanding of the urgent need for child care reform.

Download a copy of the report here.

County-Level Data

Statewide Data

Takeaways

There is insufficient licensed child care in Utah to meet the needs of working families.

There are more than 154,000 children under the age of six living in Utah with all available parents in the workforce. But, there are only 54,804 licensed child care spots in 1,367 programs statewide. Licensed child care program capacity is only sufficient to serve about 36% of all children under six whose parents are working. That means the working families of nearly two-thirds of Utah’s youngest children must rely on alternate arrangements (such as utilizing family members, hiring or sharing a nanny, alternating parent work schedules, using unlicensed child care providers, or some combination of these).

The high cost of child care makes it even less accessible to low- and middle-income families, and rural families struggle most.

Affordability remains a significant hurdle with child care costs often consuming a substantial portion of a family’s income. The U.S. Department of Health and Human Services defines affordable child care as care that costs no more than 7% of a family's income. In Utah, the average annual cost of care for two children under the age of six (one infant, one preschool-aged child is $16,890, taking up about 17% of family’s income. For a family in rural Grand County, the cost of that care is actually higher at $17,339, consuming 41% of their income. The lack of dramatic differences in child care prices from county to county is an illustration of how little flexibility providers have to reduce tuition costs for parents, even in areas of the state where family incomes clearly can’t keep up.

Licensed child care is insufficient in every county in Utah, though the level of unmet need varies from place to place.

Summit County emerges as the county with the highest percentage of child care need met (54%), followed by Carbon, (48%) Sevier (45%), Grand (45%), Salt Lake (45%), and Iron Counties (41%). All other counties have less than 40% of child care need met with licensed program capacity, and multiple rural counties (Daggett, Piute, Rich, and Wayne) have no licensed child care available at all.

With substantial public investment, Utah’s child care system has grown 31% since the start of the COVID pandemic.

Through various federal funding streams, nearly $600 million has worked to grow Utah’s child care capacity from approximately 42,000 licensed slots in March 2020 to over 54,000 in August 2023. In contrast to many other states, Utah has managed to increase its licensed child care capacity - despite substantial pandemic disruptions - through stabilization grants paid directly to existing providers for wage supplementation, startup support for new programs, and a one-time worker bonus of $2,000 per child care professional. These financial investments both expanded the enrollment capacities of existing programs as well as recruited new providers into the sector. However, with the ending of this funding in October 2023, Utah risks jeopardizing this incredible progress.

Recommendations

1. Commit to Public Investment in Child Care

Utah’s child care crisis requires public investment. Funding is needed to bridge the gap between what families can afford and the true cost of care. While businesses can contribute, their capacity to address this crisis is limited. There is no sufficient source of investment to address child care’s market failure aside from public funding. Child care should be valued in the same ways as the public education system, ensuring equal access and opportunities for all children. Currently, the burden of expensive early education falls largely on Utah families, with minimal public support, even though most brain development occurs before age six.

2. Help Parents Afford the Care They Want

Utah’s current child care system doesn’t promote parent choice. Child care affordability and accessibility severely limit family choice when it comes to child care, forcing decisions based on cost or access, rather than preference. This also impacts family planning and career choices. Parents are forced to make difficult choices, such as changing jobs, adjusting school and work schedules, or choosing suboptimal child care situations. To address these issues, policymakers should consider improving the child care subsidy program, expanding the child tax credit, and finding ways to help alleviate the financial burden on Utah families.

3. Support the Critical Work of Child Care Professionals

Child care professionals face significant financial challenges. Low wages and a lack of benefits, including healthcare and retirement, have made the profession unsustainable, leading to high rates of turnover each year. Since Utah’s current child care system only meets 36% of the state's need, Utah must invest in the early child care profession to attract and retain a robust workforce. To support child care providers, policymakers should consider measures including state funding of Child Care Stabilization Grants, wage supplement programs, eliminating barriers to licensure, and increasing access to employment benefits.

For questions or inquiries regarding this report, please contact Voices staff members: 

• Anna Thomas,
• Jenna Williams,  

We know that Utah’s child care crisis is bad, and is going to get worse. New data helps illustrate exactly how bad the situation is, in each county across the state. 

Next week Voices for Utah Children will release a report titled, “Mapping Care for Kids: A County-Level Look at Utah’s Crisis in Licensed Child Care.” The report includes more detailed county-level analysis and data highlighting the inaccessibility of care and financial challenges faced by families and child care professionals. In addition, the report includes policy recommendations for Utah leaders to help resolve this crisis. 

The full report will be available the week of October 23rd, but as a teaser, this blog highlights some key findings from the report.

There is insufficient licensed child care in Utah to meet the needs of working families.

Licensed child care program capacity is only sufficient to serve about 36% of all children under six whose parents are working. Parents face shortages in every county statewide, with rural families struggling most.

The high cost of child care makes it even less accessible to low- and middle-income families, and rural families struggle most.

The average annual cost of care for two children under the age of six (one infant/toddler, one preschool-aged child) for a Utah family costs about 17% of a 4-person family’s income. Cost varies little between rural and urban counties, but on average household median incomes are lower in rural areas. In Grand County, with the state’s lowest median annual income at $42,654, the cost of care for a family of four would comprise about 41% of a family’s income.

Child care providers receive insufficient compensation, and have few incentives to stay in the field.

Child care providers typically earn low wages and very limited benefits. The median hourly wage for child care professionals in Utah is just $12.87 per hour ($26,770/year), less than they could make as professional dog walkers. The poverty rate among child care providers in Utah is 23.1%, more than 8 times higher than that of K-8 teachers. 

With substantial public investment, Utah’s licensed child care capacity has grown significantly since the start of the COVID-19 pandemic.

Thanks to federal funding streams totaling nearly $600 million, licensed child care capacity in Utah has grown by approximately 31% since March 2020. This growth is due primarily to child care stabilization grants made directly to licensed child care providers; those grants recently were reduced by 75%. Utah has been identified as one of six states that could see half or more of all licensed child care programs statewide close with the end of the stabilization grants.

Licensed child care is insufficient in every county in Utah, though the level of unmet need varies from place to place.

How does child care access and affordability compare in each county?

Our full report, “Mapping Care for Kids: A County-Level Look at Utah’s Crisis in Licensed Child Care” will be released the week of October 23rd. For questions about the report, this blog, or sources and methodology, please contact Jenna Williams at . For more information on efforts to improve Utah’s child care system or learn about the child care advocacy network, visit utahchildren.org/issues/early-childhood-education and utahcareforkids.org.