Child Care Crisis Costs Ohio $5.5B Annually
Ohio's Child Care Crisis Costs Economy $5.5 Billion Annually
COLUMBUS, OH – Ohio's lack of affordable and accessible child care is crippling the state's economy, costing an estimated $5.5 billion annually in lost wages, business profits, and tax revenue, according to a new report from the U.S. Chamber of Commerce Foundation. The Cicero Group, a business research firm, conducted the study, which highlights the significant impact of child care challenges on Ohio families and businesses.
The report reveals that the $5.5 billion figure encompasses several key economic losses. Businesses are losing $1.2 billion due to employee absences, and another $2.8 billion is attributed to employee turnover costs, including the expense of recruiting and training replacements. The state is also experiencing a $1.4 billion tax revenue loss from employee turnover and an additional $124 million loss from absences among hourly workers.
The study surveyed Ohio parents, revealing widespread struggles. Families spend an average of $572 monthly on child care, with 70% utilizing financial assistance programs, most commonly the federal child tax credit. One in four parents reported adjusting work schedules or reducing hours due to child care limitations, while 22% worked while simultaneously caring for a child. Furthermore, 40% of parents pursuing education or training experienced disruptions due to child care issues.
The report emphasizes that these challenges are not limited to urban areas. While urban areas generally have greater child care access, affordability remains a significant barrier. Rural areas face a more severe shortage, with some regions designated as child care “deserts.” Aaron Merchen, a senior director at the U.S. Chamber of Commerce Foundation, noted a disconnect between parents’ priorities (health and safety) and the factors driving their child care choices (primarily cost).
The lack of affordable child care also affects Ohio's competitiveness. Ohio's public child care subsidies are available only for families earning up to 145% of the federal poverty level, lower than neighboring states. While Governor Mike DeWine proposed a refundable tax credit and increased subsidy eligibility, the Ohio House Republicans opted for a pilot program involving tri-partite cost sharing between businesses, the state, and families. The House budget includes $10 million for this program and $3.2 million for a child care recruitment and mentorship grant program.
Business groups are increasingly advocating for child care solutions, recognizing the impact on recruitment and employee retention. The Ohio Chamber of Commerce supports legislation aiming to create voluntary employer-sponsored child care programs. The ongoing debate regarding Ohio's two-year budget reflects the growing urgency to address this critical economic issue.
COLUMBUS, OH – Ohio's lack of affordable and accessible child care is crippling the state's economy, costing an estimated $5.5 billion annually in lost wages, business profits, and tax revenue, according to a new report from the U.S. Chamber of Commerce Foundation. The Cicero Group, a business research firm, conducted the study, which highlights the significant impact of child care challenges on Ohio families and businesses.
The report reveals that the $5.5 billion figure encompasses several key economic losses. Businesses are losing $1.2 billion due to employee absences, and another $2.8 billion is attributed to employee turnover costs, including the expense of recruiting and training replacements. The state is also experiencing a $1.4 billion tax revenue loss from employee turnover and an additional $124 million loss from absences among hourly workers.
The study surveyed Ohio parents, revealing widespread struggles. Families spend an average of $572 monthly on child care, with 70% utilizing financial assistance programs, most commonly the federal child tax credit. One in four parents reported adjusting work schedules or reducing hours due to child care limitations, while 22% worked while simultaneously caring for a child. Furthermore, 40% of parents pursuing education or training experienced disruptions due to child care issues.
The report emphasizes that these challenges are not limited to urban areas. While urban areas generally have greater child care access, affordability remains a significant barrier. Rural areas face a more severe shortage, with some regions designated as child care “deserts.” Aaron Merchen, a senior director at the U.S. Chamber of Commerce Foundation, noted a disconnect between parents’ priorities (health and safety) and the factors driving their child care choices (primarily cost).
The lack of affordable child care also affects Ohio's competitiveness. Ohio's public child care subsidies are available only for families earning up to 145% of the federal poverty level, lower than neighboring states. While Governor Mike DeWine proposed a refundable tax credit and increased subsidy eligibility, the Ohio House Republicans opted for a pilot program involving tri-partite cost sharing between businesses, the state, and families. The House budget includes $10 million for this program and $3.2 million for a child care recruitment and mentorship grant program.
Business groups are increasingly advocating for child care solutions, recognizing the impact on recruitment and employee retention. The Ohio Chamber of Commerce supports legislation aiming to create voluntary employer-sponsored child care programs. The ongoing debate regarding Ohio's two-year budget reflects the growing urgency to address this critical economic issue.
