Factors that Influence Child Care Choices and Use

In any community, child care is a marketplace. The choices that parents make for children when they are not in parental care are driven by many factors. Some of these choices vary by current state and federal policies that influence the types of care available and the funding for certain types of care or supports to pay for care. Choices are also driven by local economic factors. This summary outlines some of these and others that contribute to the trends in child care use in any community. Early childhood programs that serve children and families can use the talking points and guiding questions provided when discussing child care and to support local planning. What is most important to keep in mind is that this market system is complex and it is very difficult to attribute one effect to one specific cause and what a community experiences in the child care market is often a result of multiple interacting factors. The private market remains the primary provider of child care. In 2003, the licensed child care market was estimated to be $963 million in Minnesota. There were more teachers and caregivers working in child care than licensed teachers working in elementary schoolsand it has only grown since that time. Adding more informal types of care to this total such as friends, family and neighbor child care providers would make the child care market even larger.

Local Costs of Child Care

Minnesota has one of the highest average rates of child care costs for children of all ages in the nation.One reason may be that Minnesota has comparatively higher wages than other states and 86% of the costs of child care is labor. In 2009 Minnesota parents paid an average of 12% of their income for child care. For families with lower incomes (200% FPG and under) this proportion was 20% (Chase & Valorose, 2010). This average masks the significantly higher rates of care for infants and preschoolers which can increase child care costs to up to 28% of family budgets (Gould & Cooke, 2015). Parents make choices regarding whether or not to use certain types of care in part based on cost.

Local Employmentand Economy

Although even many stay-at-home parents choose to send their preschool children to child care to support kindergarten readiness, most parents of young children use child care because they choose to, or must, work outside the home. Two aspects of employment should be considered when examining local child care patterns: the number of local employers who employ working-age parents, and the wages those jobs pay. These factors need to be considered in relation to the local costs of child care. For instance, the child care use patterns in a community dominated by retail employers paying minimum wages may look different from those in a community in which a majority of employers produce medical devices or conduct engineering research and development. This may be a particularly important consideration in small communities with few employerswhere most employees do not commute elsewhere for work.

Population Density (Families with young children)

Overall, the population of the United States is aging and the state of Minnesota is no different. However, some communities may be aging “faster” than others while some may be experiencing an increase in the birth rate. Knowing local demographic patterns can help child care programs understand changes in child care use. Too many, or too few children to support the providers in an area can affect price and eventually, availability of care. Early childhood programs that complete an annual birth census and track local population patterns will be in a position to anticipate this aspect of local child care needs.

Parental Choices related to Quality Care

The ways parents judge the quality of early child care can vary by a number of factors. In the past decade, more and more information has become available about early childhood and brain development and many states, including Minnesota, have invested in public education efforts related to helping parents understand and identify important attributes of quality early care. This has led some parents to choose more formal care (e.g. center child care) over less formal (e.g. friend and family care). Still other parents may always prefer to use friend and family care for their young children for cultural reasons, or simply because they are confident that these individuals will care the very best for their children.

Shifts in Public Funding, More Choices, and Better Access

Over the last twenty years there have been many shifts in public expenditures for child care. While theshort-term impact for individual children or providers may be large, the impact on the overall market is typically minimal due to the small percentage of children and families servedby providers transitioning into and out of the market. And, as stated before, the majority of the marketplace is private.

Other changes have included increases in Early Childhood Special Education, Head Start, School Readiness, Early Head Start/Child Care Partnerships, Head Start Duration grants, the shift to all day every day kindergarten,local levies,and Early Learning Scholarships. All day every day kindergarten has had an impact on the market as over 99 percent of parents voluntarily access the program. Early Learning Scholarships havealso impacted the market by providing another mechanism for low-income families to access care.In spite of these changes, many programs continue to have waiting lists.

Child Care Businesses Open and Close for Multiple Reasons

There are many reasons individuals decide togo into business providing child care or later, leave child care. The child care profession operates veryclose to the margin (or sometimes over the margin) and small shifts in a local market may encourage someone to leave earlier than they would have otherwise.In addition, child care businesses are often ineligible for business loans because of the relationship between their operating costs and incomes. There are services available to assist center and family child care providers in these situations such as connecting with First Children’s Finance,and program and staff grants available through T.E.A.C.H. and R.E.E.T.A.I.N.for staff to seek more formal education and to stay at their site. However, there are no services that support health care costs nor retirement planning for family child care providers despite the physical demands of the job. For some, after their own children are grown there is less financial incentive for a provider to stay in the field.

Talking Points and Guiding Questions for Programs

Programs seeking ways to have productive local conversations about early care might consider first developing a full picture of their unique child care marketplace and how it has changed over time. Some key questions and talking points are noted below.

Parents choose care for many reasons including quality, cost, and location. And often, they choose multiple child care providers at the same time to balance their needs.

  • What do parents in your community feel is “high quality” early care?
  • When cost is a very important factor for families, the prevailing local wages for the jobs typically held by working parents of young children should be taken into account. Do these jobs pay a wage that is sufficient to pay for the type of care that is available?
  • Regional labor market economic profiles are completed annually by the state Department of Employment and Economic Development. These profiles include demographic information and prevailing wages. They are located at
  • Employment statistics by region can also be found at
  • Is early care available in locations that parents can get to?
  • Is care available at the time of the day parents need (again, based on typical work hours of employees in the community)?

Are parents of young children using the type of care that meets their child’s needs?

  • If not, what does their child need, and if cost is a factor, would they change their arrangements from what they have now if they could afford different care?

Is your community changing in terms of the number of families with young children who live there?

Where do opportunitiesexist forprivate child care and publicly funded programs to work together to build the local capacity of their early childhood education and care system?For instance communities across the nation and state are implementing some of these partnerships:

  • Is there a child care provider that is open to providing care for the second or third shift?
  • If parents prefer, is busing available to take the children from school to the child care site?
  • Are there professional development opportunities where both public and private staff can attend?
  • Are there data sharing agreements in place to streamline child-level assessments and Early Childhood Screening procedures to make the most efficient use of resources?
  • Are there partnerships to support enrollment at the community level so funding is maximized and parents understand all of their choices?
  • Is ECFE and child care able to collaborate to provide parent education in a way that works for everyone?

In what ways is the district already collaborating with private child care sites? Consider what benefits have been realized, such as:

  • Has this conserved resources for the community?
  • What would it cost to expand these opportunities?
  • Is there a seat on an Advisory Board that needs to be filled?
  • Opportunities for collaboration may include ECSE children accessing private child care, Head Start/child care partnerships, School Readiness/child care partnerships, Early Childhood Screening partnerships, professional associations, etc.

What additional ways do you see that community child care staff can collaborate to build opportunities for your area?

These and other key discussion points and questions can help programs have more productive local conversations about the state of early care and education in their communities. If GrEaT programs have other hints, tips, or experiences with having productive dialogues, please share them and we will add them to this list.

Sources:

Adams, G., and Katz, M. (2015). Balance quality education and parent’s workforce success: Insights from the Urban

Institute’s Assessment of the Massachusetts Subsidized Child Care System. Research Report. Urban Institute: Washington, D.C.

Chase, R., and Valorose, J. (2010). Child care use in Minnesota: Report of the 2009 Statewide Household Child

Care Survey. Wilder Research: St. Paul, MN.

Davis, E., and Li, N. (2005). Child Care Assistance and the market for child care in Minnesota. Minnesota Child

Care Research Partnership report, #DHS-4234-ENG-10-05.

Davis, E., Kraft, C., Blasberg, A., Carlin, C., Forry, N., Isner, T. and Tout, K. (2013). Minnesota child care choices:

Continuity of care and participation in the Child Care Assistance Program. Child Trends Publication #2013-12, Child Trends: Minneapolis, MN.

Gould, E., and Cooke, T. (2015). High quality child care is out of reach for working families. Issue Brief #404.

Economic Policy Institute: Washington, D.C.

Minnesota Department of Human Services. (2006). Cost of providing center-based child care in Minnesota. #DHS-

4845-ENG-8-06.

PunhnPungello, E., and Kurtz-Costes, B. (1999). Why and how working women choose child care: A review with a

focus on infancy. Developmental Review, 19(1), 31-96.

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