Texas loses billions to child care breakdowns

Illustration of a fridge covered in fridge magnet letters spelling out "ka-ching" — Illustration: Sarah Grillo/Axios

A dearth of affordable child care is putting a massive dent in the Texas economy.

Parents are missing work or leaving jobs to take care of children in a landscape pock-marked by the pandemic and labor shortages, according to new research by the U.S. Chamber of Commerce Foundation.

The big picture: Even as North Texas is attracting new businesses, finding and affording child care is shaping up to be a critical issue for parents eager to enter the workforce.

Context: Relatively low wages, an increasing cost of living and ripple effects of the pandemic have led to severe child care staff shortages and enrollment caps, daycare operators report.

What they’re saying: “Without suitable child care options, many Texans will be forced to exit the workforce,” the chamber of commerce researchers found, “which has negative financial impacts on their household and limits the talent pool available to businesses in an already competitive labor environment.”

By the numbers: Child care issues result in an estimated $9.39 billion loss annually for Texas’ economy, per the chamber research.

As much as $1.8 billion is lost annually in tax revenue due to child care challenges.
Absences and employee turnover cost Texas employers an estimated $7.59 billion per year.
Almost three-quarters of parents (74%) reported missing work due to child care issues in the past three months.
Approximately 7% of parents voluntarily left a job due to child care hiccups.

Zoom out: The U.S. House version of the Biden administration’s Build Back Better Act provides child care subsidies covering roughly 20 million children.

Texas lawmakers opted to increase state reimbursements for child care providers this year — but decided not to establish a statewide study to understand the true cost of quality child care.

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