Fixing early ed system could cost $1.5 billion a year 

MASSACHUSETTS’S EARLY CHILDHOOD education system is unaffordable and inaccessible to too many families, and it will cost an estimated $1.5 billion a year to improve it, according to a report released Monday by a special legislative commission looking at the economics of early education and care. 

The commission, led by Education Committee co-chairs Sen. Jason Lewis and Rep. Alice Peisch, calls for expanding the subsidies available to families while increasing financial support to childcare centers themselves and their workers. But it stops short of calling for universal public pre-kindergarten, as some activists have been calling for.  

“What we conclude is our current system of early education and care in Massachusetts is not meeting the needs of our youngest children, particularly children from disadvantaged backgrounds,” Lewis said. “It is not meeting the needs of all of our working families, and it’s also not meeting the need of many of our employers, which is having an impact on the economy.” 

Massachusetts historically has been one of the most expensive states for childcare. According to the report, the average annual cost for childcare is around $20,000 for an infant and $15,000 for a four-year-old. Most families pay between 20 percent and 40 percent of their income on childcare.  

The COVID-19 pandemic has only made the situation worse. According to the report, 1,359 childcare programs have closed since March 2020, representing 17 percent of programs and accounting for 23,395 slots for children. Around 70 percent of closures were family providers, who offer care in their homes to a small number of children, and most of the closures were providers that relied on private pay customers rather than public subsidies.  

A lack of childcare affects the economy. National studies have documented large numbers of mothers leaving the workforce during the pandemic due to a lack of childcare. 

Yet even with the high tuition payments, childcare remains a low-paying industry, with childcare workers earning less than public school teachers. The average annual salary for an early educator pre-pandemic was $30,000, or $14.11 an hour.  

This system creates multiple challenges: low wages result in difficulty retaining a high-quality workforce, yet centers cannot raise wages without increasing already-high tuition rates. 

“I think the work we did over the past year confirmed concerns we have had for some time that the system needs support in order to become stable and reliable,” Peisch said. “No surprise, it’s more challenging for low-income people to find good reliable childcare than for those who have more resources.” 

The report recommends both short- and long-term changes. Immediately, it calls on the state to continue providing the childcare stabilization grants that became available during the pandemic through 2022, at a cost of $480 million. It also recommends making permanent a policy instituted during the pandemic, where centers that receive subsidies for low-income kids are paid based on enrollment rather than attendance, so if a child is absent, the center still gets the money. 

To address affordability, the report recommends immediately increasing the subsidy rates given to low-income families and making it easier to apply for subsidies, while taking time to determine how much a high-quality education actually costs to inform future policy changes. The commission also recommends expanding eligibility for subsidies from 50 percent of median income to 85 percent of median income – which would cost the state an additional approximately $425 million annually. 

Other recommendations relate to encouraging partnerships, like sharing resources among centers and using public school pre-K to reach underserved families. 

The report is not specific about where the additional money will come from. It says new state and federal money will be required, and the state could explore partnerships with businesses so that, for example, more companies offer on-site childcare. “It’s something the Legislature will have to grapple with,” Peisch said. 

A coalition of education and business advocates have been pushing for a $5 billion ambitious plan to overhaul the early childhood system and provide universal, affordable, high-quality pre-k to all families, by turning a system that is largely private pay into one that is far more heavily publicly subsidized.  

The Common Start Coalition issued a statement praising the report as including “critical recommendations that, if fully implemented, will begin to address some of the most critical issues at play,” including increasing affordability and supporting the workforce. 

Both Peisch and Lewis noted that the report is broader than just addressing the needs of three- and four-year-olds. It’s recommendations relate to childcare from birth to age five and after-school care for older children.  

Peisch said the state has limited resources, and her priority is helping families most in need. “Maybe someday we’ll get to universal pre-k for everyone, but right now I’d prioritize serving the most vulnerable and needy students before extending it to everyone,” Peisch said. She added that she does not want to sacrifice care for infants or toddlers to provide universal pre-k for four-year-olds. 

The Education Committee has received extensions from the Legislature to continue working on early education-related bills until May 1. Lewis said committee members were waiting on this report. He anticipates that the committee will craft a comprehensive bill addressing some of the report’s recommendations. Peisch said she, too, is hopeful that the Legislature will take up the report’s recommendations in the short term and over the coming years. 

Both House Speaker Ron Mariano and Senate President Karen Spilka issued statements praising the report. “By bringing [early education and care] providers, parents, state leaders and the business community together on these recommendations, we have laid the necessary foundation for ongoing partnerships to continue as we consider ways to stabilize and support the EEC sector and build a stronger system for providing access to high-quality, affordable care for families, especially our most vulnerable and underserved populations,” Mariano said. 

Amy O’Leary, executive director of the advocacy group Strategies for Children, said the recommendations laid out by the report “tackle many of the persistent challenges we have faced and puts us on a path to establishing a system of affordable, high-quality early education and child care for all Massachusetts families including much needed support for early educators.”