Boom in day care industry the result of many social changes

Monthly Labor Review, August, 1995 by William Goodman

The daily life of preschool children in the United States has changed dramatically in the last 20 years. Because mothers of young children are far more likely to work than at any other time in the past, mother and child now spend much less time at home.(1) Furthermore, far more relatives--particularly women-also are employed, and have less time to spend with nephews, nieces, young cousins, and grandchildren. For these and other reasons, young children are more likely to attend day care centers. During the 2 decades, employment in private-sector day care centers increased by more than 250 percent, gaining nearly 400,000 jobs and continuing to grow during two of the four recessions in the period. No single factor influencing the day care industry and examined here has increased as has employment in the industry. Instead, a combination of at least five major factors drives demand for the services of child-care centers.

Trends in day care jobs

Employment growth in the day care industry since 1972 has been much more rapid than the growth of most industries: overall, the number of day care jobs has grown by approximately 250 percent, or 375,000 jobs. Growth occurred almost throughout the 22-year period, except for the early 1980's, during which two back-to-back recessions occurred. From early 1979 to summer of 1982, 30,000 jobs were lost in day care. Renewed growth from fall 1982 to mid-1985 expanded the number of jobs to above the preceding peak, and strong growth has since continued. Unlike most industries, child day care continued to expand vigorously during the recessions of 1973-75 and 1990-91. Explanations for these movements, including the seemingly inconsistent behavior in the various recessions, are discussed below.

Causes of growth

One way to begin an analysis of employment growth in day care is to distinguish between growth attributable to greater enrollment and the effects of changes in the ratio of enrolled children to staff. Fewer children per staff member generally improve the quality of care. Consistent, regularly timed estimates of the ratio of children to staff are not available. But one publication calculates that the average ratio of children to caregivers and teachers in full-time centers (7 hours a day or more) increased considerably, from 6.8 to 8.5 children per worker, between 1976 and 1990.(2) Because a staff member supervised more children in 1990, the change in the ratio pushed down employment. If the ratio had remained unchanged, employment in 1990 would have been greater by 110,000 in full-time centers alone.

Because fewer staff members now handle the same number of children, enrollment increases must account for the employment of larger numbers of teachers and child care workers in the industry. Consistent measures of total enrollment of children in day care, at regularly timed intervals, also are not available.(3) However, an abundance of indirect evidence indicates tremendous growth in enrollment. In addition, one source concludes that enrollment in full-time early education and care increased from 900,000 children in the mid-1970's to 3.8 million in 1990.(4)

Why enrollment grew

Several factors caused the growth in enrollment. Although an increase in the population of children is the most obvious cause, growth in the proportion of children who are in day care programs has had much more influence. The increasing percentage of children in day care reflects large gains in the number of their mothers who have jobs.

U.S. population of youngsters. In 1990, children 3 to 5 years old accounted for 52 percent of day care enrollment; children under 6 accounted for 74 percent.(5) (See table 1.) While the growth in the populations of these age groups has been gradual, at 1 to 3 percent annually, the aggregate growth of children younger than 6 from 1972 to 1994 has been 3 million. (See table 2 and chart 1.) The number of 3-to-5-year-olds increased by 1.6 million.(6)

[TABULAR DATA 1 & 2 OMITTED]

If the ratio of day care center employees to all children under 6 is held constant at the 1972 rate, the increase in the population of youngsters under 6 implies relatively slight growth in employment: 22,000 day care employees, or just 6 percent of actual growth. Clearly, changes in these populations are only a minor factor in the expansion of the industry Evidently, additional factors strongly affect demand.

Changes in the family. Children of working mothers are enrolled in centers as a primary arrangement for care nearly twice as frequently as children of mothers without jobs. As of 1990, if school is excluded as a child care arrangement, 17 percent of children younger than 13 with employed mothers were enrolled in a center as their primary arrangement; among children under 13 with mothers who did not hold jobs, 9 percent were enrolled in centers as a primary arrangement.(7) The number and proportion of women at work have increased greatly in the last 20 years, rising from 41 percent in 1972 to 54 percent in 1993(8) (See table 2 and chart 1.) The proportion of working mothers of children under 6 rose by an even greater percentage: from 33 percent in 1975 to 5 percent in 1993. Mothers of children under 3 also greatly increased their participation in employment, from 28 percent in 1975 to 49 percent in 1993. (See table 1.)