Kentucky Gets Creative in Addressing Its Child Care Staffing Shortage

Starting in late October, child care workers in the state are automatically eligible for child care subsidies via the state’s Child Care Assistance Program
Blog Post
Nov. 21, 2022

If you’re a parent on the hunt for consistent child care, it will come as no surprise that the country is facing a serious shortage of early educators. Even prior to the pandemic, high turnover rates in early childhood programs caused by low pay and poor working conditions contributed to difficulty finding high-quality early care and learning.

And the pandemic has made a bad situation even worse: According to the Bureau of Labor and Statistics, there are about 100,000 fewer child care workers now than there were prior to the pandemic. The chronic low pay that these workers receive has forced many to leave the industry altogether for higher wages and better benefits in sectors like fast food and retail. Establishments like Chick-fil-A and Target are often able to offer compensation that is higher than the $13.22/hour that child care workers earn on average.

Of course, fewer staff members working in the child care industry means that families who desperately need care are often unable to find it. According to a 2021 survey, about 1.9 million people have turned down job offers due to a lack of child care. And new data from the Bureau of Labor and Statistics suggest that more than 100,000 Americans missed work last month due to child care problems. According to a 2019 report, this lack of reliable child care across the nation comes at an annual cost of $57 billion in lost earnings, productivity, and revenue.

Recently, states have responded to the child care worker shortage with a few different strategies. States like Connecticut have offered one-time bonuses of $1,000 to show gratitude to child care workers. New Mexico has announced plans to use federal relief dollars to provide $3-per-hour pay supplements to between 13,000 and 16,000 workers at licensed centers. For its part, Maryland recently passed a legislative package that will allocate $53 million in state funds to providers who are struggling financially and create a fund to help pay hiring and retention bonuses to child care staff.

Kentucky is trying a different approach to attract more workers into child care. New jobs are coming into the state, such as the recent announcement of an additional 500 full-time jobs due to an expansion of the Ford Motor Co., but many employers are still struggling to find workers due to a lack of consistent child care, according to Sarah Vanover of Kentucky Youth Advocates. To recruit more workers into child care and thereby increase child care supply, as of October 24, employees of regulated, licensed child care centers or family child care homes in the state will automatically be eligible for child care subsidies via the state’s Child Care Assistance Program (CCAP) regardless of their total household income. Put simply, if you work at a licensed child care provider, you’re eligible for child care assistance.

This benefit is available for anyone who works in a licensed center or child care home and can show proof of their qualifying place of work, whether they teach and care for kids or prepare food in the kitchen. And the child care subsidy can be used at any center or home that accepts subsidies; it doesn’t have to be used at the same program where the parent is employed.

Kentucky is currently funding this new benefit with federal COVID-relief dollars. While these federal dollars must be spent by September 2024, a state task force is exploring if it can be sustained in the absence of federal funding by modeling how much it would cost the state to maintain this benefit into the future. It likely wouldn’t be a significant cost increase for the state to maintain this regulatory change since the low pay afforded to child care professionals means many of these workers already earn less than 85 percent of the State Median Income, making them eligible for child care subsidies even without the regulatory change.

We know that typical employee benefits, such as health insurance, retirement contributions, and paid sick leave are not available to many early educators. Expanded eligibility for child care subsidies is one way providers can offer a fuller benefits package, even if a partner's income may slightly push the child care professional out of the typical income range needed to qualify for a subsidy.

Already, some centers offset a portion of the cost of tuition for their own employees as a benefit, but offering that benefit deprives them of much-needed tuition dollars. This regulatory change means employees still get the benefit of reduced costs of child care without having a negative impact on the provider’s bottom line. According to Vanover, the child care staffing crisis in the state has become so significant that many programs have at least one classroom closed due to a lack of staff members. Covering the cost of child care could entice some individuals back to work or lure them away from the fast food or retail industries that are often able to pay a higher wage and offer better benefits.

Will this new benefit actually help ease the staffing shortage facing Kentucky’s child care providers? Advocacy groups hope to eventually see an increase in the number of child care professionals in the state via the regular surveys they perform as well as in workforce data tracked by Kentucky’s Division of Child Care. The state is currently hard at work spreading the word about the expanded eligibility so as many eligible people as possible can take advantage of it. As other states get creative in their attempts to entice more workers into the child care industry, it will be worth considering Kentucky's new strategy as one way to simultaneously help the child care workforce, increase the capacity of providers, and assist families searching for affordable child care.

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