One Chart Shows Why Some Working Parents Opt Out of Day Care

Parents know raising a baby will cost them a fortune and a half.

Childcare costs have remained above overall inflation for 25 years and do not show signs of slowing down. That growing cost is one reason some parents are forking over $30,000 a year in some states or working solely remote jobs to save money while their kids run in the background of meetings.

Since 2000, day care and preschool costs in cities across the US have continually outpaced inflation. Childcare costs have increased 153%, compared to overall prices’ 90% increase, over that time.

With return-to-office polices becoming increasingly common, parents are forced to shell out money to have someone else watch their kids. More than 66% of families with children under 18 have both parents working, according to Bureau of Labor Statistics data.

That dual income is necessary for many families, as some parents described feeling like they’re taking out a second mortgage to have a day care center look after their little ones.

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“It’s great having the kids, but then you all of a sudden have this new mortgage expense each month, from a combination of day care and any other expenses like formula and diapers,” Jason Schilling, a father of two from Minneapolis, told Business Insider.

One couple described the hunt for the right day care as like “The Hunger Games.” Parents we’ve spoken to say wait lists can stretch up to two years for the best day care services in their metro area. They recommend that after the first positive pregnancy test, you enroll as soon as possible.

Extended wait times coinciding with steadily rising costs nationwide come as options for childcare services reopen slowly after the pandemic. Childcare workers often leave the profession entirely due to low pay and burnout.

Mixing all these factors, parents are either paying up or getting creative. One mom cut her hours in half, bringing in half the income, to spend more time raising her daughter and save on day care costs, which could have totaled around $3,500 a month.

Reports and surveys don’t show a bright future for parents. Automation has helped reduce costs across sectors, but childcare and other service industries still lack these capabilities. Experts warn that day care costs will continue to take a higher percentage of each household’s income, hurting the overall economy.