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Home Small Business

The big factor holding back the U.S. economic recovery: No childcare

Business Market by Business Market
July 3, 2020
in Small Business
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The big factor holding back the U.S. economic recovery: No childcare

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Yet many school systems are discussing only a partial reopening in the fall or remaining virtual, and up to half of America’s child-care centers may shut permanently because they can’t survive financially, industry leaders warn, leaving families with even fewer options.

As parents struggle with this new reality, some employers are not showing much flexibility. Florida State University announced that effective Aug. 7, employees can no longer care for children while working remotely.

While big companies might be able to provide white-collar workers with generous work-at-home flexibility, blue-collar and “essential” industries, from grocery store, fast-food and sanitation workers to nurses, often can’t. Low-income and working-class women — who have already been hardest hit by the crisis — as well as smaller businesses are disproportionately impacted by the childcare crunch. Some who would turn to grandparents for extra help now see that option as less safe and other possibilities can be unaffordable.

If schools and child-care centers remain closed, German researchers estimate 8.4 percent of economic activity in Europe won’t happen, a substantial loss that could hit the United States similarly, researchers say.

Eliza Navarro was forced to quit her nursing job at a hospital in San Benito, Tex., in April when she couldn’t find child care for her two children. It’s been a devastating financial blow for the single mom, but she was forced to chose between her job and her kids.

“I had no choice but to quit. I want to work, but because of everything that happened with schools and day cares closed, I wasn’t able to,” said Navarro, 33. “I’ve been working since I was 17. I love working. I love my patients and my job.”

Navarro has sent out dozens of applications for telehealth nursing jobs so she can work for home, but she has yet to hear back. A spot for one of her kids finally opened at a local summer camp, but she didn’t have enough money to pay to reserve the space.

“Until this spring I was always able to pay all my bills. This pandemic has totally changed my life,” Navarro said. “My son just told me what he wants for his birthday, and for the first time, I might not be able to get it.”

Thirteen percent of U.S. parents had to quit a job or reduce their working hours due to a lack of child care, according to a survey of 2,557 working parents conducted by Northeastern University from May 10 to June 22. The survey found parents were losing an average of eight hours of work a week — the equivalent of a full day — because they had to address their kids’ needs.

Economics professor Alicia Sasser Modestino, who led the study that has not been made public yet, said even she was surprised how much of an effect child-care challenges are having on America’s workforce.

Small-business owner Bridget McGinty made the painful decision…

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