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Access to Childcare: A Dual Issue for Small Businesses

Posted By Elizabeth Sullivan, WIPP Advocacy Team, Friday, March 13, 2020
Updated: Wednesday, March 11, 2020

No one disputes the need for access to quality and affordable childcare. Like small business issues, this has been a rallying cry for both sides of the political aisle. However, something has been missing in this discussion – recognizing that childcare providers are also small business owners. 

Elizabeth Sullivan The House Small Business Committee recently held a hearing on this issue, Taking Care of Business: How Childcare is Important for Regional Economies. This hearing was personal because I worked in several daycares in Chicago, including teaching at a Head Start center, and I saw the needs and problems firsthand.

One of the things discussed were public-private partnerships. Witness Dan Levi of the Black Hawk Childcare Coalition in Iowa highlighted how these have positively impacted his community. The Coalition provides support to communities with detailed business plans, architectural review of possible projects, funding opportunity consultation, community engagement tactics, and facilitation of public-private partnerships. Grants from organizations such as the Iowa Women’s Foundation help childcare centers in his community with financial stability and resources that are free and distributed through the Child Care Resource & Referral offices around the state.

Also discussed was the regulatory burden on childcare centers. I can’t emphasize enough how this impacts childcare operations. While there are necessary regulations to ensure health and safety, complying with these regulations is a substantial time commitment. Not to mention it sometimes turns into the sole focus of the daycare operations – pushing classroom issues aside.

There is an increased role for the SBA – helping these childcare small business owners with the business side of the house. For example, the Chicago Women’s Business Center has many resources for childcare centers. However, many childcare centers, including the ones I worked in, have no idea these resources exist. 

During my time at the Head Start center in Chicago, Illinois, the state was in a funding standoff, and there was no subsidized money coming from the state to help families pay for the cost of childcare. Childcare center owners had a decision to make – charge families the full amount or try to float the cost. In this case, the center served 100% low-income children. The owner, like many others, were forced to ask families to pay the entire amount – or their children would be turned away. As you can imagine, this caused a huge strain on the families served by the center. 

SBA could contribute its business instruction and lending programs to these childcare center owners. Access to better business resources would equip these owners with strategies to deal with cash flow issues and funding lapses. 

A perspective I felt was missing from the hearing was the duality of childcare centers also being small businesses. One of the ways Congress has attempted to tackle this issue is through language in the FY19 Labor-HHS-Education appropriations bill. Included was the ability for states to use funds to Child Care and Development Block Grant (CCDBG) funds to strengthen the business practices of childcare providers to expand the supply and improve the quality of child care services. Areas of support for childcare providers may include, but are not limited to, such practices related to fiscal management, budgeting, record-keeping, as well as hiring, developing, and retaining qualified staff.

Childcare issues are not simply a family issue—it is also an employer issue. Employers lose $4 billion annually due to absenteeism. Many of those days are due to lack of adequate childcare. This Committee hearing was a good start in raising awareness that childcare centers are also small businesses. It’s time to find more resources for these business owners – the issue of quality childcare is not going away.



The WIPP Advocacy Team provides thought leadership on WIPP Policy Priorities

This column focuses on the following priority:

 

Rethink workplace development

Key to the success of women-owned businesses is human capital – a dynamic workforce that meets the needs of an ever-changing business environment. Government and business need to work together to ready a workforce that can meet those challenges.

 

Tags:  Advocacy  childcare  development  workplace 

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