In 2024, the cost of daycare in the United States remains a significant financial burden for many families. As the nation grapples with what some economists are calling a “silent depression,” understanding these costs and exploring how families are managing them is crucial.
Daycare Costs in 2024
According to a January 2024 report from childcare platform Care.com, the average cost to have an infant in a licensed center-based daycare is $16,692 a year, or $321 a week. Home-based daycare for an infant costs, on average, $11,960, or $230 a week. For toddlers, the average center-based daycare is $15,236 a year ($293 a week), and a home-based daycare averages $11,388 ($219 a week). For parents of school-age kids, Care.com found the average cost to get an afternoon sitter for 15 hours a week is $15,184 per year, or $292 a week.
Regional Variations
Daycare costs vary widely depending on location. For instance, the average infant daycare cost in Washington D.C. is $21,788, while in Arkansas, it’s $6,708. For the sake of comparison, the average annual salary in Washington, DC is $79,385, while the average salary in Arkansas in 2024 is $52,941. Even within a state, there can be significant differences between fees in major cities and rural or lower-income areas.
Factors Driving Up Costs
Several factors contribute to the high cost of daycare:
- Staff Wages: Childcare providers often require specialized training and certifications, which justifies higher wages. However, many still earn relatively low salaries, prompting facilities to balance fair pay and affordability.
- Regulatory Requirements: Strict regulations regarding staff-to-child ratios, safety standards, and facility conditions increase operational costs for daycare centers.
- Insurance and Liability: High insurance premiums to cover liability and other risks add to operational costs.
- Facility Maintenance: Rent, utilities, and maintenance costs for daycare centers, especially in urban areas, contribute significantly to overall expenses.
Why Daycare Costs Are Rising
Daycare costs have risen between 0.4% to 13% more than last year. Sean Lacey, general manager of childcare at Care.com, says that fees are only projected to grow further this year. This increase is partially due to inflation but mostly because of what’s termed the “childcare cliff”: the end of the $24 billion in pandemic-era federal funding that supported 220,000 childcare providers. The expiration of this aid in September 2023 has forced many daycare centers to pass costs along to parents or shut down. The Century Foundation projects that 70,000 childcare centers will close, leaving more than three million children without care.
The “Silent Depression” and Its Impact
The term “silent depression” refers to the economic struggles faced by many Americans that are not as visible as a recession but still significantly impact daily life. Factors contributing to this include stagnant wages, rising living costs, and increased financial instability. The burden of daycare costs exacerbates these struggles, making affordable childcare a critical issue for many families.
