Child Care: Critical to Early Development, but Expensive in NJ

Household dollars don't go as far as they used to in the Garden State, and as more families send both parents to work to make ends meet, they may struggle to find high-quality, affordable child care.

That's the bottom line of a new report from Advocates for Children of New Jersey, which points out the challenges that many parents face in a state where childcare costs can eclipse those of food and healthcare, a burden that lower-income families may find even more cumbersome.

As many as 400,000 children aged five and younger live in homes with two working parents, and about 412,000 New Jersey children younger than age six receive care at least part of the week because of it, the report notes.

These ages are significant because they are benchmarks for early childhood development. Kids who receive high-quality child care before the age of five “have a better chance of arriving at kindergarten with the foundation they need for school,” the report says.

Unsustainable costs

Even as more children are raised in New Jersey households with two working parents, the report points out that childcare costs account for a significant portion of their budgets.

Families with one infant and one toddler may dedicate nearly a quarter of their budget to child care, making it the second-biggest household expense, after housing. In households with a median income of $85,000, that equates to $20,000 annually.

Families earning wages closer to the poverty line may pay as much as 88 percent of their annual income for child care—far more than they will spend on healthcare or food costs.

“Single working mothers of one infant can expect to spend about one-third of their income for childcare,” according to the report. “Low-income parents will spend one quarter of their income on care for one child, or nearly half for two children.”

Families earning more than double the federal poverty level are disqualified from federal subsidies for childcare costs. Only 50,000 New Jersey children on average received this subsidy monthly in 2013; many more may qualify.

Only 35 percent of childcare costs are deductible from federal taxes (up to $3,000 a year per child, or $6,000 for two or more), and New Jersey is one of 14 states to not offer a state tax credit for childcare costs.

A call for standards

Another challenge lies in determining the effectiveness of childcare facilities. According to the report, there were a total of 4,015 licensed childcare centers in New Jersey as of August 2013.

Fewer than 7 percent of those are nationally accredited, the report notes, and only seven are accredited by the National Association for Family Child Care.

These facilities could serve about 343,000 children from birth to age 13; another 11,330 children may receive child care from private caregivers registered to the state. 

Each private home can care for a maximum of five children, and only registered facilities are eligible for state subsidies. The report did not provide an estimate of the number of children in unregistered private care.

There are only 38 state inspectors available to oversee those centers, and each will visit more than 100 sites annually, according to the report; sometimes two or three a day. 

That workload doesn’t count travel time, repeat visits to follow up on corrective actions, or the investigation of outside complaints.

Plus, the staff at childcare facilities earn fewer than $23,000 a year, on average, the report notes, which is not on par with the earnings of other early childhood educators, and “can result in high turnover and lack of staff skills, which are both detrimental to young children.”

Solutions

In a brief that accompanies the report, Advocates for Children of New Jersey also identifies a handful of potential solutions to these issues.

The first of these solutions is to create a website that provides access to childcare center audits that would help families to make informed decisions about where to send their children.

Another is to hire more childcare center inspectors with the intention of easing the burden on current staff.

The group also recommends requiring background checks for childcare providers who operate centers out of their homes. 

'Legislation is pending that would require this," the report notes, but it would cost $3.7 million annually.