A $1.2 billion flood of federal financing has prevented an already unstable Arizona child care sector from collapsing, giving state authorities a chance to fix a dysfunctional system that they created, and possibly delivering hope for the stability that parents and providers have yearned for.
In March 2020, when coronavirus cases began to spread across Arizona, Gov. Doug Ducey announced a statewide school shutdown to stop the spread of COVID-19.
It was the most stringent measure state leaders had taken to avoid illnesses at the time. It was a breaking point for employees and clients at Yuma child care provider Desert Trails, who had grown increasingly concerned about the safety of their families.
“People worried as soon as the governor declared’schools are closing,'” centre director Arianna Zaroff said. “We only had around 15 people, and I’d say at least half of them basically walked out on us” after evaluating the risk of exposure against the realities of a low-paying, high-stress sector.
Furthermore, “we lost families really quickly,” she explained. “There were days when we only had five, six, or ten kids in the centre,” which has a capacity of 78 children.
As a result, profits plummeted, despite the fact that mortgage, utility, and most other expenses remained constant. It was a “huge impact” for a child care provider that, like others in Arizona, was already running on razor-thin margins and struggling to pay personnel, according to Zaroff.
Desert Trails and other operators have benefited from a $1.2 billion flood of federal relief cash, which has helped them avoid a sector-wide collapse. However, industry analysts say that sum alone won’t be enough to undo the decade of neglect the child care system faced at the hands of state authorities before the pandemic.
When Arizona was in the red during the Great Recession, elected leaders decreased state child care funding, eventually eliminating the state’s contribution to subsidies designed to make care more affordable. When the state was in the black, they refused to restore that revenue, instead pushing through a substantial tax cut that state budget specialists determined would primarily benefit the wealthy. In the interim, officials botched many possibilities for federal assistance, failing to accomplish what was required in some cases to gain new funds while allowing tens of millions of dollars in existing federal aid to go wasted in others.
These actions added to the frailty of a system that already didn’t work well for anyone save Arizona’s wealthiest families, who were able to endure rising child care costs and dwindling state aid.
Arizona had already lost over 900 child care providers in the two years leading up to the pandemic, as they fought to stay financially with low state payment rates that had stayed mostly unchanged for nearly 19 years. The industry’s difficulties was exacerbated by high turnover among workers, about 20% of whom lived in poverty. In addition, over half of Arizonans lived in a “child care desert,” where there were more than three children for every available place, and those who didn’t couldn’t afford it.
According to the most recent data available from the state’s Child Care Resource and Referral network, another 244 providers closed from January to June 2020, reflecting the first three months of the pandemic.
“The early childhood system has tightened its belt and worked on a shoestring budget and decreased costs to the point… it can’t function,” said Kelley Murphy, vice president of policy for the Children’s Action Alliance, based in Arizona. The epidemic compounded “quite profound issues that were troubling before COVID hit,” she added.
Children need safe, developmentally appropriate care to arrive at kindergarten on an equal academic and social footing, positioning them for long-term academic success. An unstable, unaffordable child care sector has clear implications for children: they need safe, developmentally appropriate care to arrive at kindergarten on an equal academic and social footing, positioning them for long-term academic success.
It also has far-reaching economic implications.
To make a living and advance, parents, particularly single parents and those without paid time off or other benefits, require dependable child care. Rural regions, low-income families, and working women are disproportionately affected by the lack of access to high-quality care.
As mothers took on the majority of child care chores at home during the epidemic, women’s workforce participation fell to its lowest level since 1988. According to Census Bureau data, around 1.4 million of the women still out of work early this year were moms, and less-educated mothers of colour continue to have the slowest financial recovery.
According to local and national experts, federal recovery funds has allowed Arizona to reassess and address long-standing structural flaws in its approach to paying and delivering child care services. Officials warn that if they don’t grab the opportunity—and if an ambitious federal plan to decrease child care costs throughout the country fails to pass Congress—the state would likely be back where it started once relief funds run out.
Rasheed Malik, associate director of early childhood policy studies at the left-leaning Center for American Progress, said, “We’re many, many years behind other countries in terms of ultimately making these investments.” “It’s expensive, but the longer we wait to fix it, the more expensive it will be.”
‘This isn’t the type of firm where you can get away with cutting corners.’
In the years preceding up to the epidemic, early childhood development advocates had long warned about the unsustainable structure of Arizona’s child care industry.
It is costly to provide dependable, high-quality child care. And, according to Malik, it’s “not the kind of industry where you can just cut shortcuts” to save money because of the tight health and safety regulations.
As a result, providers frequently pass on expenses to parents in the form of increasing tuition prices, potentially pricing out all but the wealthiest. According to the Economic Policy Institute, the average cost of child care for toddlers in Arizona had reached $8,500 per year by the time the pandemic struck, while baby care cost nearly $11,000 per year. That’s more than an in-state college’s base tuition.