The Bank of America Institute’s recent report has shed light on the escalating childcare costs in the US, which are now averaging $700 per household per month. This represents a 32% increase since 2019, leading to a faster depletion of families’ savings and a slowdown in their spending habits. The report suggests that these rising costs are impacting consumer behavior and labor market participation.
According to the report, there has been a notable decline in dual-income households this year compared to 2019. This trend points towards an increasing number of workers exiting the labor market due to growing childcare responsibilities. The situation may further deteriorate with the potential closure of nearly 70,000 child-care facilities across the country.
Interestingly, all this data was collected prior to the termination of the Child Care Stabilization program, a $24 billion initiative that previously subsidized childcare expenses, making it more affordable for families. The end of this program could potentially exacerbate the current situation, as it previously played a crucial role in enhancing the affordability of childcare.
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