"Childcare has become so expensive that many families have given up looking for affordable options and are providing the service themselves, forcing them to make tough financial and personal sacrifices. While consumer prices overall have cooled off sharply from 40-year highs in 2022, childcare costs have not and were up 5.2% year over year in September-more than 1.5 times the total inflation rate, according to a note from Bank of America Institute last week."
"For example, parents that pay for childcare have drawn down their savings by nearly a third on average just for that one cost, BofA said, citing data from Care.com. Another option is to work less and provide that care directly. "Faced with these escalating costs, many families are torn between spending a large portion of their paychecks on such care, finding lower-quality options, reducing their working hours, or leaving the workforce altogether to become full-time caregivers," BofA said."
Childcare costs rose 5.2% year over year in September, more than 1.5 times the overall inflation rate. The number of households making monthly childcare payments declined 1.6% annually in September even as average monthly payments increased 3.6%. Daycare for one child now exceeds one month's rent for many families. A government shutdown could threaten Head Start programs for lower-income families. Wage growth has lagged for less affluent households, leaving lower-income families' spending flat while higher- and middle-income spending accelerates. Many parents have drawn down savings by nearly a third or have reduced work hours or left the workforce to provide care.
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