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Guess What Private Equity is Doing to Childcare

At its core, private equity firms — which differ from traditional investment firms in seeking very high returns over a burst of a few years before selling, and are insulated from legal consequences — have an inherent conflict of interest between kids & families and their profit motive. You know, I talked to Melissa Boteach, who heads up child care work for the National Women’s Law Center. And she explained it so well:

“The bottom line for private equity, and investor-backed chains more broadly, is profit for [investors]. The bottom line for child care should be early learning and care for children. And it’s not that you can’t ever reconcile those two things [but] when you implement standards, whether it’s living wages for early educators, low child-to-adult ratios, or other measures that affect the quality of that care, investor-backed chains will face external pressures to comply with these standards in the cheapest way possible, which in turn has implications for either lowering the quality of the care or raising the fees charged to parents.”