A crisis in ‘all corners of the state’

When COVID-19 struck the nation in the spring of last year, Amy Mayfield Lusche was one of the millions of working women left in a child care quandary. Even before the crisis, Ms. Lusche, the owner of Iowa City’s Groovy Katz Salon & Spa and mother of a high school senior, a 13-year-old and 2-year-old Felix, was keeping many balls afloat while running her 16-person business. Like 69% of Iowans who rely on family members for at least some child care, she’d been leaving then 1-year-old Felix with her mother part-time. But suddenly, in the wake of a pandemic that ravaged older communities in its early days, that no longer felt safe for anyone involved. Ms. Lusche next turned to an informal home child care arrangement with a friend, who had five children of her own — part of an early “bubble” she tried to establish. When members of that family came down with COVID-19, that was out, too. With few options left and reluctant to turn to a child care facility for safety reasons, Ms. Lusche’s 13-year-old daughter has provided much of the family’s child care since last fall — a far from ideal situation, especially as the teen struggled to keep up with online school. “Having a 2-year-old and trying to protect him and protect those around us has just totally been crazy on so many levels,” said Ms. Lusche of her family’s experience, adding “this pandemic has been a whirlwind for us [and] for so many others.” Now, with the fog of coronavirus panic lifting as more and more Iowans get vaccinated, Ms. Lusche is beginning to hunt for a permanent child care solution. That too, however, has been fraught with anxiety, including long wait times, unexpected costs and few slots for the part-time hours she needs. “We’ve just been round and round whether to put him in an in-home or something that is more of a center, just because there are more restricted guidelines,” she said. “One problem is I would be forced to put him in full-time because we’re finding [centers] only have space for full-time and that’s very expensive … so I’ve also been looking at in-home, but they’re not taking anybody. It’s just a big decision … and we don’t know what to do.” Across the state and around the Corridor, parents, especially working women, are frustrated by an already fragile child care system stretched to a breaking point by the pandemic. “Band-aid” solutions in which family members stepped up to help were ripped off in an era of social distancing. Limited spots in urban areas became more limited thanks to forced closures, staff shortages, and increased hygiene and safety costs. And rural areas, already rife with “child care deserts,” grew ever more deserted. A crisis intensifies Gov. Kim Reynolds has made no bones about the situation, labeling it a “crisis” in March as she announced the formation of an 18-member Child Care Task Force to develop a comprehensive strategy to attack the problem within 100 days. “Access to affordable quality child care in the state of Iowa is an issue that certainly precedes the pandemic, but it was intensified during it,” said Ms. Reynolds, who formed the task force after her economic advisory board identified child care as the number one priority emerging from a pandemic that is keeping tens of thousands of women at home. Throughout the pandemic, women’s labor participation rates torpedoed, erasing hard-won gains and bringing employment rates to levels not seen since the late 1970s. According to Dawn Oliver Wiand, president of the Coralville-based Iowa Women’s Foundation, Iowa had already lost about a third of its providers over the past five years and faced a shortfall of more than 350,000 child care slots. The organization has long identified child care as Iowa women’s greatest barrier to employment, with one-fourth of Iowans living in child care “deserts” — defined as a community with more than 50 children and more than three children per available slot — even pre-pandemic. The supply-demand imbalance has only grown since, and IWF estimates up to half of the state’s remaining child care supply could be lost. “We know 2.5 million women left the workforce across the country over the course of the pandemic,” said Ms. Wiand, who serves on the governor’s task force, adding the crisis is likely to wreak long-term damage in lost career advancement, training and savings that could last decades. “All those strides that have been made; we’ve taken steps backwards. Many have absolutely left or taken smaller roles because they can’t find child care … or needed to prioritize their families during the pandemic.” Dr. Krystal Nizar, a former University of Iowa Hospitals & Clinics researcher and physician who had a baby during the pandemic, is one of them. Dr. Nizar transitioned to practicing telemedicine from home after her baby was born and her 2 ½-year-old’s day care was forced to close temporarily. Unfortunately, she said, there is no road back to her previous university track. “It is a sacrifice,” said Dr. Nizar, who also has a 7-year-old and struggled to improvise part-time child care for months before landing on a trustworthy in-home sitter. “I have the good fortune of being overqualified and overtrained for every position, so I have a lot of options. But I was in an academic-dependent position that requires continuing along a certain track, and stepping off that track is pretty irreversible. I mean, it is irreversible.” “We cannot ignore that 60% of the workers that left the workforce in this past year were women,” said state Child Care Task Force Chair Emily Schmitt, chief administrative officer of Sheffield-based Sukup Manufacturing. “The pandemic has disproportionately impacted women’s opportunities for pursuing their careers and advancement. That is a reality we cannot accept.” Numbers tell the story At the task force’s first regular meeting in April, members were presented with a sobering analysis of Iowa’s child care hole. Leading up to the pandemic, 412 Iowa localities had children but no known child care. An additional 489 towns and cities (48%) had some child care, but fewer slots than children. Nationally, Iowa counts the third-highest percentage of parents with children under age 6 with both parents in the workforce — 75% vs. 66% nationally — at the same time it is facing a deep shortfall in placements for children under 12 requiring after-hours care. That has left an estimated 23% of Iowans living in child care deserts, according to U.S. Census data, with the number approaching 35% in rural areas. “We also face a shortage of high-quality child care in every corner of the state,” Ms. Schmitt said. The pandemic exacerbated the shortage, causing several temporary closures that at its height impacted 59,204 slots. While many have reopened, the crisis left the state down thousands of spaces it could ill afford to lose. Much of the immediate strain was contained by parents leaving the workforce and staying home. But that has caused a knock-on effect to the state’s workforce, which is currently struggling to recover as the pandemic winds down. Citing the fact that Iowa job openings outnumbered people on unemployment, Ms. Reynolds recently ended extended federal unemployment benefits that weren’t set to expire until September. But that is only part of the solution, advocates say. Sustaining an adequate and thriving workforce is a challenge that preceded the pandemic. “We’ve done a lot of research about why there was a shortfall before, why we had a lot of openings,” Ms. Wiand said. “We’ve found that the child care crisis and the workforce shortage are interrelated.” According to Iowa Child Care Resource & Referral data from 2018-19, more than half of all parents reported missing work due to child care issues and 52% of parents who voluntarily left a job did so when children were a year old or younger. Twenty-three percent of parents reported postponing school or a training program due to child care issues. The economic fallout is “staggering once we start looking at it — $935 million annually in Iowa that is a result of the child care deficit,” Ms. Schmitt said. “And that’s combining lost tax revenue, absences, employee turnover — all the things that you can get the numbers for.” Parents speak out From Dyersville farmer Matt Vorwald, who talked about the bureaucracy involved in enrolling infant twins into the same center as a dairy cow loomed in the background, to a long line of mothers with children in their laps or speaking from the sidelines of soccer games, child care availability and cost are by far the top frustrations for Iowa parents. At a May task force town hall, at least a half dozen parents remarked that trying to secure a child care slot during early pregnancy was almost too late. “I remember touring some of the more expensive child care facilities in our area at three months pregnant and [being] told there was absolutely no way I would have a spot before the baby was born,” said Shannon Grundmeier of Ames, who had even more difficulty securing child care for her second-born, who was born with developmental disabilities. Mr. Vorwald, who works IT by day, lamented that after being lucky enough to score a place soon after he and his wife learned they were expecting, their provider had to rescind the offer when they discovered the couple was having twins due to Iowa Department of Human Services rules limiting the number of babies in a child care institution. What’s more, he said, child care costs for twins and his two older children would run upwards of $18,000 a year. “I know maybe in Des Moines or Cedar Rapids, that might sound cheap, but you also got to remember when you live in smaller towns, you don’t make the bigger figures you do in the bigger cities,” he said. Katie Hall, a Clive mother of two boys who must go to separate daycares due to space availability, also brought up high costs. She and her husband now pay just over $600 a week for their sons and have gone from paying $12,000 annually to $17,500 over four years. “And that’s a huge impact to the bottom line overall,” she said. “We have had raises, we’ve been fortunate that way, but I just think that it’s a tough spot for child care to be in. I can’t imagine being a high school student [with] a child and paying $353 a week for that child to go to full-time day care.” State officials are frank that child care is unaffordable, particularly for single parents. The state’s Administration for Children and Families, Office of Child Care estimates the average two-parent household earning the median income with an infant in child care pays 7.8% of their income for care, before taxes, if their child is in a registered home and nearly 12% of their income, before taxes, if their child is in a licensed center. By contrast, a single-parent household earning the same amount pays more than a quarter of their income — 26.9% — before taxes, if their infant is in a registered home and a whopping 41% if their child is in a licensed center. “There’s a very significant financial burden to families when they have to pay out of pocket for child care,” said Janee Harvey, the state’s division administrator for Adult, Children and Family Services. “And I would like this group to note that the federal benchmark on what is considered ‘affordable’ is around 7% of a family’s income.” Providers speak out At a separate June town hall for providers, child care center operators were sympathetic to families’ worries about long wait times, closed centers and rising costs. But almost to a person, providers — nearly all women — bemoaned the difficulty of hiring and maintaining sufficient staffing — limiting expansion and the ability to hold the line on current openings. “At many businesses around, you can flip burgers for 10 bucks an hour, but my girls aren’t making 10 bucks an hour,” said Kathy Wright of Sanborn.  “There’s no benefits, there’s no nothing, bless their hearts. They do this out of the kindness of their hearts.” Among surrounding Midwestern states, Iowa has the third-lowest number of child care workers. Only Nebraska and South Dakota have fewer. Coincidentally, Iowa pays the lowest average child care wages in the region, according to Bureau of Labor Statistics data, with workers earning an average of just $10.18 an hour or $21,170 a year. “When you think about minimum wage being $7.25 and you think about most [places] like Kum & Go and Casey’s all starting at about $12 an hour, it’s not surprising that we’re having a difficult time filling all of our child care slots,” said Iowa Workforce Development Director Beth Townsend. “That’s one thing that we want the group to talk about — what can we do to make it a more attractive field and also increase the wages that are available to those individuals who choose to work in child care? We can increase the number of providers all that we want, but if we don’t have a workforce to support it, none of that’s going to be of any value.” As of April, Ms. Townsend said, the state had almost 700 openings, most of them centered in metro areas. “If we don’t solve the staffing issue, there’s no child care,” echoed Deb VanderGaast of Tipton, adding her center is running at half capacity due to shortages. “My licensing worker was here a couple weeks ago, and she said that — I don’t remember exact numbers — of about 163 centers that she oversees, only nine are operating at capacity. They’re all having the same problem. They can’t keep staff, they can’t find staff, but they have plenty of room … Nobody can find workers because literally, everything pays better. I mean, it’s pretty bad when a step up is going to McDonald’s.” Providers said even newly available state grant money aimed at supporting centers (see next section) is being held up due to staffing shortages, in some cases. “I feel like those of us who’ve been doing this for a long time are kind of being left out of that because unless you’re willing to watch more children, which unless I go to a level C and hire a full-time worker, I can’t do anything about that,” said Jacque Dilks of Altoona. “So there may be needs that I have, but I’m not able to get any of that money.” Vickie Brandenberg of Iowa City also expressed frustrations with the state grants. Though she would like to use one to expand her facility, “you have six months to have it spent. So even if I finance the exterior of my building and want to use the money for the interior … it has to be done within six months.” While it has faded from view as the state’s 12-and-up population has gotten steadily vaccinated, Kimberly Kemp reminded task force members the threat of COVID-19 is still very much alive for younger children. Ms. Kemp said her Safe Care Learning Center in Waterloo was currently closed due to an outbreak. “And that means no funding,” she said. “This is no understatement — 99% of my families are CCA (on Child Care Assistance). There is no funding if I close. [But] I’ve closed because the health and safety and well-being for our children, our families and our staff, and our community is so much more important than any funding.” Where are the solutions? Some relief is at hand at both the federal and state levels. The American Rescue Plan, passed in March, included $24 billion to help stabilize child care providers thrown for a loop by the pandemic, freeing up money for operations and to help keep costs down for families. The plan also doled out $15 billion in flexible funding to states to make child care more affordable and increase access for families. Thanks to federal relief funding, the state of Iowa set aside $32 million to offer temporary stipends to licensed centers and registered homes, to help essential employees and those with decreased revenue pay for child care, grant programs, Child Care Assistance (CCA) waivers, and other initiatives. The proposed American Families Plan, which is not yet in Congress, includes $225 billion for child care, paid leave for parents, and would help raise the minimum wage for providers to $15 per hour, making it easier to attract and retain employees. “But we can’t just throw money at it,” Ms. Wiand said. “We need long-term solutions.” The Iowa Legislature also passed several child-care related bills in the latest session, including one that eliminates the so-called “child care cliff” in which families who begin earning over a certain dollar threshold lose all assistance. The sudden loss of assistance caused families to turn down promotions and better job opportunities in the past. The new bill creates a gradual phase-out of benefits. Another bill allows an extra school-aged child at in-home child care centers — upping the maximum number from five to six — while a third doubles the family income eligibility for child care tax credits from $45,000 to $90,000. According to Ms. Schmitt, however, the task force’s mission is bolder than nibbling around the edges of the problem. In addition to monthly meetings, members of four subcommittees are meeting regularly to study successful delivery models in other states; identify the correct regulatory environment and financing options to foster safety, quality and growth; address child care workforce recruitment and retention; and incentivize Iowa employers to partner in solutions. “We will measure ourselves with the goal of increasing Iowa child care slots by 50% within five years,” Ms. Schmitt said, adding solutions will need to be “bold” to be successful. “If we start moving with solutions, we can make a huge difference,” she said. “And when you think about other people that can go back for education or training because of our solutions, it’s going to make a world of difference. … To fully support the needs of Iowans, we need to not only start from the ground up but at the very base of the family with child care.”