Brad,

You’re making an excellent point here and hats off to you for choosing this noble career. We need more of you.

Your point about scalability is well taken. That is the reason, for example, why tech workers make large salaries – each unit of labor can be farmed out to the incredibly sized customer set. This is clearly not possible in ECE. Still there is the issue of transparency. Its not clear that all the cost here is going to the teachers. If it were, at least for me, Id consider this a bargain.

In my state, one can set up an in-home daycare after some kind of certification. Taking your numbers – 4 infants max, and the prevailing in-home rate – $1500 – 2000, that anywhere from $6-8000 per month. This translates to about $72,000 or $96,000 per year for the provider. Its true that there are business costs and I’m not the best person to speak to this. Still, I suspect this in home provider is making a reasonable living – lets call it modestly, $40,000 – 50,000. That’s around the median wage in this country. Interestingly, from my last comment, two such providers (living together) would be around or higher than the median wage in Boston.

Now scale is a good thing. So if I were to contract a bunch of people to work for me, rent a place to do the work, and buy supplies (and advertise) in bulk, I should do better. Right? Well that’s the usual approach to business anyway. So why is it that the rates at day care centers are both higher than in-home providers and the teachers make less money?

Again, I have no problem with ECE teachers being paid I advocate for increased pay. It seems to me the problem is with transparency of the operators.

Avg. annual cost of care for an infant: In most if not all States there are mandated staffing ratios. In my State, the ratio for infant care is 1 teacher to a max. of 4 infants. In addition children in ECE are allowed to be in care for a max. of 10 hours per day. That’s a lot of staffing hours for a childcare center’s payroll (which are woefully, if not shamefully underpaid to begin with).

It’s been some years since I finished college (at a public university), but I don’t remember any class where there was a low 1:4 ratio, and which I was provided the oversight and direction of my professor for 50 hours a week. Had that been the standard I suspect I would have either graduated on an accelerated timeframe, or my tuition would have been considerably more expensive (vastly more than the State subsidized rate for a public, higher edu. institution).

I’m of the strong opinion that the price of childcare is not the problem. Considering the pitiful wages of ECE teachers, it’s quite a bargain really. Maybe the musings our society is posing regarding the “expensive” of childcare is misplaced.

I didn’t realize how high the costs of childcare were either until I stumbled across this report. It really is incredible and it’s understandable why so many young people are hesitant to have children.

Hey Handy Millennial, thanks for making so many great points. As you said, the true number can actually be a lot worse when you consider how much the “median” income can actually range from and how much of that income is eaten up by taxes. Sadly, no matter how you look at it, the cost of childcare is just way too high for most families.

I had never really thought to compare childcare with college. This list of the variations from state to state is really helpful for people thinking about geoarbitrage.

One aspect is that numbers are always quoted on different scales. Specifically, the median child care cost is quoted in AFTER tax dollars, while the income is quoted in PRE tax numbers. Suppose you pay a 20% tax and you live in Massachussetts (nice numbers). Now your pretax income required to sustain $20,000 a year in child care is actually $25,000. Which is actually 21% of the married couple’s gross income, and 86% of the single parent income.

And if that’s not bad enough, the second aspect is that averages are reported statewide. The median income in the state actually ranges from $61,000 to $110,000 (wikipedia) (2013 numbers but you can see the scale, maybe its $70k to 121k now). Infant care is rarely reported by county so we are left with an average number that overstates rural care cost and understates urban care cost. Doing a quick google search, the average care cost in the Boston Metro area seems to be more like $2,500 to $3,000 per month. So on the low end we are looking at $30,000 after tax, and on the high end $36,000 after tax. Wrapping this into my earlier comment – thats $38,000 before tax and $45,000 before tax respectively. Now thats more than the single parent in both cases and 31% and 37% of the median state family income respectively. Some people here might realize that this is more than you are recommended to spend per year on a home. To throw a final wrench into the analysis, the median Boston metro family income is actually $80,000 which means the real cost of child care in eastern Massachusetts is around 50% of your median household income.

All this to say, great write up. We desperately need more attention on this issue.