The American Rescue Plan Act (ARPA), signed into law on March 11, 2021, provided the size and scale of relief needed to save the child care industry from collapse, including $24 billion for child care stabilization grants and $15 billion in supplemental child care discretionary funds. The pandemic relief dollars were a lifeline for childcare providers and families nationwide. States took necessary steps to make assistance more available and more generous for families and offering greater support to the child care early educators that serve families receiving assistance.
Yet these improvements are in jeopardy as the stabilization funding expires on September 30, 2023, with the supplemental Child Care and Development Block Grant funding set to expire on September 30, 2024.
Letting the stabilization dollars expire will leave the child care industry worse off than its pre-pandemic precarity, especially as many low-wage sectors have been able to raise wages and improve benefits on a permanent basis while the child care sector has only been able to do so temporarily. For example, between 2019 and 2022, median real hourly wages for child care workers grew by only 3.1%—that’s lower than the wage growth rate for food and beverage serving workers (8.7%), retail sales workers (5.6%), recreation workers (5.3%), and many other low-wage service occupations.