Chad Dunkley said it would make financial sense to close his family’s 88 child-care centers after the coronavirus economic crisis wiped out two-thirds of their revenue. But he kept New Horizon Academy centers open for his few remaining customers: doctors, nurses and police officers who must work and might have nowhere else to send their children.
New Horizon has stopped paying rent and can survive a few more weeks on its reserves, said Mr. Dunkley, the Minneapolis-based chief executive of New Horizon, with centers in Minnesota, Colorado, Iowa and Idaho. He isn’t sure he can last through May, though.
“It could be a disaster,” he said.
Across the country, day-care centers are facing an economic reckoning as they adopt precautionary measures to protect children and staff from the coronavirus. Child-care providers said in interviews that attendance is down as much as 90% and that they are laying off employees, while working to provide the same standards of care for children.
“The Covid crisis has had a dramatic impact on the field and very quickly,” said Rhian Evans Allvin, the CEO of the National Association for the Education of Young Children, a trade group.
A patchwork of state regulations around day care has sprung up in the past several weeks, with states such as Vermont and Louisiana allowing day-care centers to look after only the children of essential workers. Even in states without such restrictions, day-care enrollment is falling, as parents work from home or seek help from relatives to shield their children from gathering with others.
First responders say they are more dependent than ever on the day-care centers that remain open.
Kayla Shipley, an emergency-room doctor in Lafayette, La., who is married to a paramedic, said she had just worked a night shift when she got an email that schools were closing a few weeks ago. For the first time, she felt overwhelmed by what she was facing in the coming weeks.
“I literally just broke down in tears,” she said.
Without Sugar ’n Spice Preschools, which have remained open, Dr. Shipley’s husband, who works night shifts, would have to stay up all day taking care of their 21-month-old and 7-year-old daughters.
She said she is worried about bringing germs home from her hospital and infecting her children, who in turn could pass germs onto children at the day care. She used to give her daughters a hug before showering after work but now she asks her husband to take their toddler to the back of the house so she can slip in and clean up before touching them.
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Providers say they have rigid and often costly protocols to prevent the spread of infection, such as significantly reducing the ratio of children to staff members.
Tessa Holloway, owner of Kidz Karousel, which has four locations across Louisiana, said that teachers must detail where they have been in the last 24 hours and any symptoms they are experiencing before they are allowed to work. They have to show that they can hold their breath for 10 seconds without coughing. Staff are prohibited from leaving the building during their shifts, so Ms. Holloway has started bringing in lunch.
Day-care staff check each child’s temperature before allowing them in. Everyone removes their shoes when they enter the building.
Ms. Holloway said attendance is down by 90% and she has applied for loans to keep paying her 100 employees and cover other expenses. She said some providers have decided to continue charging parents even if their children aren’t coming, but she doesn’t want to add to the financial strain on families.
“We always keep a good little bit of money in the bank, but for something like this, it’s devastating. A pandemic we didn’t prepare for,” she said.
Not all providers have stayed open.
Olivette Temple said that when she weighed the risks and costs, she decided to close her two Louisiana day-care facilities, even though one is on a hospital campus with workers who need child care. Many of her staff are over 60 years old and at higher risk of severe disease from the coronavirus.
Ms. Temple, who is also president of the Childcare Association of Louisiana, said she has enough reserves to reopen but she is hearing from providers who don’t.
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“We can’t do anything but sit and wait this thing out,” she said.
Some 30% of child-care providers said they won’t be able to reopen after a closure of more than two weeks without significant government assistance, according to a survey by the National Association for the Education of Young Children.
In the stimulus bill signed by President Trump, Congress approved some $3.5 billion to provide child-care assistance to parents in essential fields, such as health-care workers, first responders and sanitation workers. It waived income limits for parents to get that funding.
Industry leaders said that is likely not nearly enough. They are requesting some $50 billion in the next rescue package, some of which would go to bonuses for employees so they don’t decide that collecting enhanced unemployment is better than risking coming to work.
Ms. Evans Allvin said it would be difficult for closed child-care centers to ramp back up during any economic rebound.
“Child care is not going to be ready to handle that,” she said.
Write to Laura Kusisto at laura.kusisto@wsj.com
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