US child care costs are a notoriously tough cookie to crack.
Even before COVID-19 hit, the US ranked up there with the most expensive child care in the world—and post-pandemic, a whopping 67% of parents are now struggling to find affordable placements for their children.
The issue hasn’t gone unnoticed. A bill to invest $15B into child care was recently introduced, but many say it’s not enough.
Care expert and Care.com CEO Tim Allen explains, “The pandemic thrust our nation’s care crisis into the spotlight. Our economic recovery rests on people’s ability to get back to work, and for parents, that makes child care indispensable. But with social distancing, remote work and the closure of businesses that many parents rely on, a new dynamic of child care is quickly emerging, and if we don’t take action now to solve this child care crisis, there will be huge ramifications for all of us.”
With the world in such a spin, no one knows what’s going to happen next (though we can make some good guesses)—but for child care providers who are able to offer quality care at low costs, the opportunities are huge.
Before you can figure out your budget and invest in the right tools, you first need to know the cost of child care in your area.
We’ve pulled together a list of the current preschool child care costs, based on the most up-to-date stats for 2020.
Check it out!
According to a 2019 World Economics report, the US is the third most expensive country for child care, with the average family with two children spending up to 33.2% of their yearly income on child care.
That’s more than most US families spend per year on food, rent or college tuition fees.
The Department of Health and Human Services (HHS) says that child care shouldn’t cost more than 7% of a family’s income. Currently, none of the 50 US states have an average child care cost of less than 10%.
The average annual cost of infant care in Alabama is $6,001, or $500 per month.
With Alabama’s average family income at around $50K per year, child care affordability is pretty low, costing around 12% of the average income. In fact, only 27.1% of families can actually afford infant care in Alabama.
As the seventh most expensive state to live in, it’s no surprise the average annual infant care in Alaska costs a huge $12,120.
But even with the above-national-average family income (just over $71.5K), only 10.4% of families can afford to send their children to infant care.
Arizona is on the higher end of the infant care costs spectrum, with the annual average child care costs for preschool age children at just under $11K.
With a relatively low average family income of just $55,386, that’s 19.8% of income that goes to child care each year.
It’s no wonder that only 8.7% of families can afford to send their children to child care, but with an average population growth rate of 2.88%, there’s a lot of opportunity for child care centers to boom.
The average annual child care costs for preschool-aged children in Arkansas is $6,890.
The typical family earns around $47,126, which means child care takes a 14.6% chunk from their annual income. Despite being the second cheapest place to live in the US, only around 18% of families can afford to send their children to child care.
California’s child care costs are definitely on the higher end of the spectrum, at $16,945.
That’s almost on par with the average state cost of renting an apartment. 🙈
With the average family earning around $68,034, an uncomfortable 24.9% of income goes to child care costs—not surprising then that nearly 93% of families are unable to afford child care.
In Colorado, infant care costs are on average $15,325 per year.
Families find it difficult to afford child care as it costs around 21% of the $73,048 average household income—meaning only 6.2% of families can actually afford it.
However, Colorado’s population has grown by over 15% since 2010 and doesn’t look set to let-up anytime soon, so there are plenty of opportunities for child care providers.
As the ninth most expensive state to live in, it’s no surprise Connecticut’s average infant care costs are so high at $15,501 per year—or 18.3% of the average annual income.
Although the average income is currently $84,482, the full-time minimum wage salary is only just over $21K. That means child care for minimum wage employees costs a cringeworthy 73.8% of their annual salary.
Things could change with the promised minimum wage increase from $12 per hour today, to $15 per hour in 2023—but it will take more than that to make child care affordable for all.
Child care for preschool age children in Delaware costs an average of $11,021.
A typical Delaware income is around $68,827 which means child care costs around 16% of the average income. Only 13.1% of families can afford to send their children to child care.
Child care in The Sunshine State is a sunnier experience than most, with the average annual infant care costing $9,238.
For families earning the average income of $53,859, infant care costs 17.2% of their income—but for those earning FT minimum wage ($17,597) the outlook’s not so good, with child care costing a massive 42.2% of their total annual income.
The eighth most populous US state, Georgia’s annual child care costs are $8,530.
For the average family (earning $55,117) that means child care is an affordable 15.5% of the annual income—but for those on FT minimum wage of just $10,712 per year, child care is anything but affordable at a whopping 79.6% of yearly earnings.
The most expensive place to live in the US, Hawaii’s average infant care cost is $13,731.
Hawaiian families earn an average of $85,854, which means around 16% goes on child care. Only 10.9% of families can afford to send their children to child care.
For ECE workers, the chances of affording child care are even less—on average, it costs a child care worker 57.4% of their salary to send just one child into daycare. Definitely worth keeping in mind for ECE employers.
Idaho is one of the more affordable states for child care, with the average yearly costs at $7,474.
That’s around 13.3% of the average family income ($56,056). Still, only 16.3% of Idaho families can afford to send their children to child care.
Illinois ranks in 11th of the most expensive child care costs by state, with the average annual cost at $13,802.
With median family earnings at $68,751 in Illinois, that’s over 20% of the annual paycheck on child care—no wonder only 8.9% can afford it.
Indiana’s average annual child care costs for preschool age children are at an impressive $12,612—that’s 22% of the median family income ($57,254).
The state is in the midst of a child care affordability crisis which is costing employers up to $1.8B per year. If you earn minimum wage ($15,080 full time per year) it costs 83.6% of your income to send just one child to daycare, so only 5% of Indiana families can afford to do so.
At $10,378, infant care in Iowa costs more than both in-state college tuition costs and the annual average rent.
With the median family income at $67,854, that’s 15.3% of the annual income spent on child care.
Kansas is expensive for infant care, with average costs at $11,222—that’s almost $2.5K more than child care for 4+-year-olds.
Not only that, infant care in Kansas also costs 12.3% more than the average rent. With families earning an average of $61,914, that means over 18% goes toward child care costs.
Kentucky boasts some of the lowest child care costs in the US, at around $6,411—only 11.9% of the median household income.
When it comes to minimum wage workers however, that number rises to 42.5%, or 22 weeks’ work, with the average FT salary sitting at $15,080.
In Louisiana, the average annual child care cost for preschool age children is $7,724 or $664 per month.
Although Louisiana has one of the lowest child care costs among US states, it’s still one of the biggest expenses families face. In fact, infant care is only 23.8% less than the average rent.
With a median family income of $53,042, around 20% of families can afford child care.
The average annual infant care costs in Maine is $9,449—just $215 (2.2%) less than in-state college tuition fees.
Even so, Maine has it better than some states, with child care costs taking up just 15.1% of the annual median family income ($62,774).
Maine has one of the smallest populations of the US states, and with over half living in Portland that’s a great starting point for ECE businesses looking to expand.
Child care costs for preschool age children in Maryland are at $15,355.
With the median family income at $87,119, that’s 17.6% of the average income going on child care costs. For child care workers, that number leaps to 64.5%, and then again for minimum wage workers who would have to spend 73% on annual child care costs for a single child.
The sixth most expensive state to live in, it’s no surprise child care costs in Massachusetts are through the roof at $20,913.
With the average rent at $14,419, infant care is an unsettling 6.5K more expensive per year.
The median family income is $92,108, which means 22.7% of the average paycheck goes on child care costs. FT minimum wage workers have it even tougher with 83.8% of their annual salary needed to cover child care costs for just one child.
The Great Lake State has an average annual child care cost of $10,861.
That’s unfortunately unaffordable for most families, as the median family income is set at only $57,054, meaning infant care costs take up at least 19% of their outgoings.
In Minnesota, average child care costs for preschool age children sit at $16,087.
It takes around 21% of the median family income ($75,756) to cover the costs for just one child, while those on minimum wage would need to dish out a whopping 78.4% of their annual earnings.
It’s no surprise only 5.8% of families can afford to pay out for child care.
In Mississippi, it costs around $5,436 per year for child care for preschool age children.
As the least expensive state to live in, Mississippi residents have it better off than most, as it only takes around 11.7% of the median family income ($46,656) to cover child care costs.
Thanks to the Mississippi Department of Human Services, parents with low incomes can receive extra child care cost support, which is probably why almost 30% of families can afford to send their children to child care.
The average child care cost in Missouri is $10,041.
With the median family income at $58,329, that’s 17.2% of the average paycheck going on child care—more than both in-state college tuition fees and the average annual rent.
The Missouri Department of Social Services’ Child Care Subsidy Program helps low income families with extra costs.
Annual infant care costs in Montana are $9,518 per year, and costs 16.5% of the annual median family income of $57,815.
Infant care costs $2,736 (40.3%) more than annual in-state college tuition costs and only slightly less than the average rent, making it one of the biggest costs families face.
Nebraskan residents can expect to pay around $12,571 per year for child care.
With the median family income at $65,534, that’s almost 20% of the yearly paycheck on child care. For families on minimum wage ($18,720), that stat leaps to 67.2%.
In Nevada, annual infant care costs are $11,408 per year—that’s $951 per month.
If that sounds high, that’s because it is. In-state college tuition costs almost half the amount at just $5,920 per year.
For the typical Nevadan family, infant care for one child would take up to 20% of their gross annual income. No surprise only 6.8% of families can afford it.
Parents in New Hampshire pay $12,791 per year on child care for preschool age children.
With the median family income at $83,565, that’s 15.3% dedicated to each child in infant care. Low wage workers have even lower odds of affordability, with minimum wage workers having to work for 35 weeks a year to send just one child to daycare.
As the 15th most expensive state for child care, New Jersey residents can expect to pay around $12,988 per year for child care—that’s 14.65% of the median family income ($88,898).
Only 17.8% of families can afford to send their child to infant care—no surprise when it’s only $645 less than a year’s worth of in-state college tuition fees.
Annual child care costs for preschool age children in New Mexico are relatively low at just $8,617 per year—but when you compare that to the median family income of $47,115, it’s clear to see that child care is still one of the biggest expenses New Mexico families face.
For minimum wage workers, infant care takes up 55.2% of their annual earnings. And the outlook for child care workers isn’t much better, with infant care costing up to 43.7% of their yearly paycheck.
The third most expensive state to live in, New York’s child care costs reflect that at $15,394 per year.
Although the US Department of Health and Human Service (HHS) says child care shouldn’t cost more than 7% of a family’s income, child care in The Empire State takes a huge bite of 18.3% from the median household income—and only 9.4% of families can afford to send their kids to child care at all.
The annual cost of infant child care in North Carolina is $9,480—that’s $2,125 (28.9%) more than in-state college tuition fees.
With the median family income at $53,249 that means paying for child care for just one child costs 17.8% of the gross annual income.
The North Carolina DHHS offers subsidized child care, one of NC’s longest-running social programs.
For families in North Dakota, the annual cost of infant care is $9,091 or $790 per month.
The median family income is $72,213, which means infant care takes a 12.6% bite from the annual earnings. For child care workers that stat leaps to 38.8%, while FT minimum wage workers have it even worse at 60.3% of annual earnings to pay for just one child.
The North Dakota Child Care Assistance Program and Child Care Aware of North Dakota both offer support and resources for low income parents.
Child care for preschool age children in Ohio sets parents back $9,697 per year.
With the median family income at $57,283, that’s a huge 16.9% of the average annual earnings going straight to child care. Only 12.2% of Ohio families can afford to send their children into care provision.
The Ohio Department of Job and Family Services supports care providers and parents with licensing, resources and child care payment assistance.
As the third least expensive place to live in the US, Oklahoma residents have to dish out a relatively small $8,576 per year for child care provision.
Even so, with the median family income at $53,061, that’s still a significant 16.2% that needs to be budgeted for child care provision for each child—12.5% more than the average in-state college tuition fees.
The Oklahoma Department of Human Services is the place to go for more info on quality child care providers.
In Oregon, child care costs for preschool age children is around $13,616 per year. For the average family, that’s a whopping 22.2% of their annual income per child.
As the fifth most expensive US state to live in, housing, groceries and transportation are also through the roof compared with other states, so it’s not surprising that only 6.3% of families can afford to send their children to child care.
Oregon Early Learning offers resources and a list of low cost child care options.
The annual child care price in Pennsylvania is $11,842—or 17.5% of the median family income ($67,828).
For full time minimum wage employees however, infant care costs are an unaffordable 78.5% of their average yearly earnings ($15,080).
The Department of Human Services runs a child care subsidy program, Child Care Works.
Yearly child care costs in Rhode Island are $13,696.
With the median family income at $66,928, that means 20.5% of a typical Rhode Island family’s earnings go straight to child care—more than the average cost of rent or a year’s in-state college tuition fees.
No wonder only 6.6% of families can afford to send their children to child care.
Child care costs in the Palmetto State are relatively small at $7,007 per year.
For families earning the median income of $51,996, that’s a reasonable 13.5% that goes on child care. Unfortunately, for full time workers the outlook’s not so bright with 46.5% heading straight for child care provision for each child.
Luckily, South Carolina parents benefit from government support via the SC Voucher Program run by SC Child Care, meaning almost a quarter of families can actually afford to send their kids to child care.
South Dakota is one of the cheapest states when it comes to child care costs, at just $6,511 per year.
With the median family income at $63,730, child care costs just 10.2% of the typical family’s annual budget—the lowest in the country. 🙌
The South Dakota Department of Social Services offers support and resources for child care providers and parents.
Tennessee parents can expect to pay $8,732 per year on child care or $728 per month.
Although Tennessee is the sixth least expensive place to live in the US, the median family income is just $52,325 meaning child care still takes up a sizable chunk of the average family’s annual budget (16.7%).
In Texas, the average cost of child care for preschool age children is $9,324 per year—7.8% more than in-state college tuition fees. That makes Texas one of the 33 states (+ DC) where infant care costs more than college.
15.8% of parents manage the bill, despite child care costing around 15.7% of the median family income ($59,440).
Texas Health and Human Services is the place to go to find more info on child care licensing and low cost child care.
The cost of child care in Utah is $9,945 per year.
With the median family income at $71,904, that’s 14% of the average family earnings on child care for each child. With the highest number of children per family (2.32) of any US state, that percentage can be easily doubled for families needing to send their children to daycare.
But with Utah’s minimum wage staying strong at the federal minimum wage of $7.25 per hour, the cost for minimum wage workers is often too much to bear at a shocking 65.9% of their annual income.
The annual child care costs for preschool age children in Vermont are $12,812.
As the twelfth most expensive state to live in, and with the median family income at $69,962, it’s no wonder only 5.9% of Vermont families can afford to send their children to child care—one of the lowest rates in the country.
In Virginia, parents can expect to pay around $14,063 per year on child care.
With the median annual income at $77,325, 18.2% of the typical family’s budget goes straight to child care—7.8% more than the cost of annual in-state college tuition fees.
For minimum wage workers, the costs are insurmountable. Their annual income is just $15,080, meaning it would take 93.3% of their earnings to send just one child to child care.
The average annual child care costs in Washington are $14,554.
With the median family income at $72,124, that’s a huge 20.2% of the annual budget that goes on child care.
The Washington State Department of Children, Youth and Families offers support and resources for child care providers and parents.
Washington D.C. residents struggle to find high-quality affordable child care, with the highest average child care costs in the country ($24,243).
For those earning the median family income of $84,892, that means a huge 28.6% of the annual budget on child care. But when it comes to minimum wage workers, the stats leap to 83.3%, despite having the highest minimum wage in the country at $13.50 per hour.
West Virginian parents can expect to pay around $8,736 per year on child care—more than rent or in-state college tuition fees.
The median family income is $51,210 meaning 17.1% of the average income goes on child care fees per child.
The West Virginia Bureau for Children and Families offers local resources for child care providers and parents.
Child care for preschool age children in Wisconsin costs around $12,567 per year or $1,047 per month—that’s almost 50% more than the cost per year for in-state college tuition fees.
The families earning the median annual income ($67,786) have to reserve 18.5% for child care, but for those on minimum wage in Wisconsin, infant care costs around 83.3% of their annual income.
In Wyoming, child care costs $10,647 per year.
For families on the median annual income of $71,611, that’s a 14.9% share of their annual earnings—48.3% more than the annual cost of in-state college tuition fees and 20.5% more than the average rent.
The Wyoming Department of Family Services offers licensing and resources to child care providers.
Now that you know where you stand with the cost of child care in your area, it’s time to figure out where your business will sit on the scale.
The next steps are to write a killer biz plan and build a solid budget, taking into account the child care management tools you need for a streamlined business.
Remember, affordable child care is unfortunately a rare gem across the US—so if you can offer that option, the opportunities for your business and your community are huge.
Good luck!
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