KVSP Child care costs are outpacing inflation: Report
Written by ABC Audio ALL RIGHTS RESERVED on May 31, 2024
(NEW YORK) — The cost of child care in the U.S. is rising at nearly double the pace of overall inflation, according to a new report by tax firm KPMG.
Between 1990 and April 2024, the cost of day care and preschool rose 263%, according to KPMG. The consumer price index, the government’s key measure of inflation, has increased 133% in the same time frame.
“The child care crisis, which was simmering prior to the pandemic, has come to a boil,” the report’s researchers said.
Diane Swonk, KPMG’s chief economist, told ABC News the high cost of child care is a key reason why Americans are downbeat about the economy, despite strength in other indicators like unemployment.
And while many companies have returned to pre-pandemic work patterns, Swonk said women are still disproportionately staying on the sidelines of the workforce because of child care responsibilities.
The labor force participation rate of women with kids under the age of 6 was 69% in 2023. The rate of men in the same group was 95%.
“This is an untenable choice — a catch-22 — choosing between caring for and providing for your family,” Swonk said.
A separate report by the Federal Reserve found parents in the U.S. paid a median of $800 per month for child care.
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