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Area childcare shortage worse than expected

Jerome Ferson

The shortage was worse than expected.

A study commissioned by Families First of Minnesota and United Way of Olmsted County found that Olmsted County was 1,855 short of the expected capacity of 6,700 full-time care slots available.

In Olmsted County, the number of family-care providers dropped from 502 in 2012 to 376 in 2017.

On the other hand, there's been an increase in the number of centers offering full-time programs, rising from 30 in 2012 to 33 last year.

Still, supply is not meeting demand, said Jon Losness, executive director of Families First of Minnesota, and Jerome Ferson, president and CEO of United Way of Olmsted County.


"We can't ignore the fact that there is a shortage," Ferson said. "This issue is pressing for parents in the workforce today."

Destination Medical Center is expected to expand the workforce, and Losness and Ferson noted that child care needs to be part of the discussion. Employers, they said, must be willing to be flexible for the workers they hopeto hire.

"We want DMC to be successful," Losness said," and this is one piece of addressing the issue."

Cost is also an issue. Infant care in Olmsted County averages $169 per week. The average cost for infant care at a center is around $303 per week, while toddler rates average $160 a week in a family setting, and $271 in a center.

The median family income in Olmsted County is about $68,000. That means a typical family with an infant and toddler would need to pay around 44 percent of their gross annual income for child care if both children were in a center.

Even in a family setting, the family would need to use 25 percent of their gross annual income to cover child care, according to Losness, or around $17,160 per year.

"This is a workforce-related issue, and there's a demand for workers," Ferson said, "but there are workers sitting on the sidelines that can't join because of child care they can't afford or find."

There are 34 child-care centers in Olmsted County and they employ about 700 workers. There are also 374 family child-care providers. If these caregivers were under a single employer, they'd be considered a top 10 employer in Olmsted County.


Nationally, most child-care workers are women whose average age is 36, the median hourly wage for workers is $9.77 — Rochester's McDonald's and Panera offer $11 for a starting wage — and the annual wage is $20,780 for full-time work, and about 60 percent of the child-care workforce is full time.

Also, the median annual wage for child care directors is $45,670, but 10 percent make less than $29,000, according to Child Care Aware of America.

What can they do?

Several approaches to the declining numbers of child-care supply were introduced. Among them:

• Ensuring child care licensors provide a consistent method for reviewing child care providers and addressing concerns

• Recognition from the business community that the child care shortage is a workforce issue that they must share in addressing such as contributions to child care accounts, flexible work schedules to address demands, and support for legislation that makes affordable child care and entices more people to enter the business.

• Develop training and mentoring systems to ensure new providers get the tools necessary to start and grow their businesses successfully

• Provide access to affordable ongoing training for providers


• Alert providers and potential providers to the relatively new financial incentives available to them. Minnesota offers $1,000 to child care providers as an incentive to improve the quality of their program and the education they offer to children in their care. On July 1, the state will offer $2,500 for programs attaining 1-, 2-. and 3-start levels in the Parent Aware rating program.

• Legislative action, including the move toward the 'fix it ticket' plan for minor offenses by providers, increasing state Child Care Assistance Rates, which are currently pegged at 25 percent of the 2011 market rate since no providers in this region will take CCAP as full payment for child care and increasing Basic Sliding Fee child care so more families are eligible.

'Good things will come'

Ferson said that the numbers, while concerning, highlight the need for more immediate action and attention from market forces.

"It's hopefully the start of something, and hopefully not the end of something," Ferson said. "We're encouraged. ... good things will come."

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