The Massachusetts Taxpayers Foundation is set to release a report on Thursday that outlines the detrimental impacts the childcare shortage is having on the state’s economy. Among the eye-popping stats: Inadequate childcare cost businesses in Massachusetts an estimated $97 million a month last summer and fall, or more than $1 billion a year — largely because of employees who have left jobs to care for their kids, and the disruption that turnover caused.

The business-backed foundation projected that employers lose nearly $812 million every year due to lost productivity, turnover and replacement costs when workers need to step away to care for their children, in addition to the estimated $1.66 billion in lost wages that families face.

And because of lower wages and spending, state government also collects $187 million less in taxes every year as a result of poor child care access, MTF said.

Over the past few years the issue of child care has gained momentum in national and state policy discussions. This has been especially true throughout the pandemic, as the public health emergency and economic fallout turned a dire child care situation into a crisis. Due to the increased focus on this issue, there has been growing interest in analyzing how insufficient child care impacts the economy. Inadequate child care access is particularly relevant in Massachusetts, where demographic trends and workforce constraints may exacerbate the economic impact of child care gaps.

The Briefing Covers: 

1. MTF Preview: Economic Impact of Insufficient Child Care
2. Child Care Funding 101
3. Early Education and Care Economic Review Commission
4. Budget Updates
5. What’s Next for MA Child Care Policy?
    

Please join us for our March policy call. The topic will be an update on early education. For more information about this event, please contact Debbie Carroll at dcarroll@masstaxpayers.org.

MTF members, click HERE to register.

In addition to other federal relief money, Massachusetts received $314 million in child care stabilization funds through the American Rescue Plan Act, according to a brief from the Massachusetts Taxpayers Foundation. States are required to spend 90 percent of the stabilization funds directly on grants to providers.

Over the last two years, the federal government has spent trillions of dollars to combat the COVID-19 pandemic and spur an equitable economic recovery. The Coronavirus Aid, Relief, and Economic Security Act (CARES Act), Coronavirus Response and Relief Supplemental Appropriations Act (CRRSA Act), and the American Rescue Plan Act (ARPA) provided relief for households, businesses, and states and local governments.

Now is the time for the education establishment to embrace the greater foundational change that is needed to deliver for students, even if it makes adults in the system uncomfortable. Despite their long-held view that money alone will fix the problems endemic in our schools, just pouring additional monies into the current system without change would be a missed opportunity to make needed improvements.

As we emerge from the pandemic, the need for robust pathways to economic opportunity is urgent. Students and businesses alike are demanding access to the skills needed for success in our dynamic economy. A recent report from the Department of Elementary and Secondary Education (DESE) found that 44 out of 58 career-technical education (CTE) schools surveyed had a waitlist. Statewide, demand among rising 9th graders for spots in CTE schools is 1.5 times the number of places available, and that demand is growing. Expansion of CTE school capacity is necessary.

The third big question is how to pay for everything. The Mass Taxpayers Foundation forecasts a $6 billion loss in state revenue in FY 2021, which starts July 1. This gigantic shortfall greatly reduces the chances of new revenue for schools from the Student Opportunity Act (SOA).