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Tag: child care benefit

  • In U.S. First, New Mexico Launches Free Child Care for All

    New Mexico became on Saturday the first U.S. state to offer free child care to all residents in a bid to boost its economy and lift education and child welfare levels ranked the worst in the country.

    Under the program, families, regardless of income, can receive state vouchers to cover public and private child care fees. It culminates efforts New Mexico has made to expand access to free child care since the governor and state legislature created the Early Childhood Education and Care Department in 2019.

    The launch comes as other Democratic-run states, cities and counties eye a step popular among working families. Connecticut recently passed a bill making child care free for those families earning under $100,000 per year and no more than 7 percent of income for those earning more. New York mayoral candidate Zohran Mamdani has proposed no-cost universal child care.

    Big savings for families

    Taos special education teacher Allyson O’Brien expects to save around $12,000 a year in child care bills for her son Otis, who is nearly 2-1/2. She and her husband Shawn O’Kelly, a truck driver, earn a fraction above New Mexico’s previous income cap for free child care, which was about $129,000 per year for their family of four.

    “We’ll be able to go on vacation, we won’t have to decide what bills we’re going to pay, like, are we going to do propane or the mortgage?” O’Brien said.

    To achieve a fully universal system, New Mexico must create nearly 14,000 more child care slots and recruit 5,000 educators, according to its Democratic-run government. The state is establishing a $12.7 million low-interest loan fund to construct and expand child care facilities. It is also increasing reimbursement rates to providers that pay entry-level staff a minimum of $18 per hour, above the state’s $12 hourly minimum wage, and offer full-time care.

    Alison McPartlon, director of the University of New Mexico-Taos Kids’ Campus child care center, said her waiting list is so long some children do not get in before they start kindergarten. She said higher reimbursement rates will help her retain and recruit educators.

    “There will be more centers coming up,” said McPartlon, describing the shift to universal child care as “incredible.”

    Addressing poverty

    New Mexico Governor Michelle Lujan Grisham told reporters child care was “the backbone of creating a system of support for families that allows them to work, to go to college, to do all the things they need to do to continue to lift New Mexico out of poverty.”

    Nearly 18 percent of New Mexicans live below the poverty line, according to the U.S. Census, making it one of the poorest states. Slightly larger in area than the United Kingdom, with only 2.1 million people,

    The state will fund universal child care, estimated to cost $600 million annually, largely with interest from its Early Childhood Education and Care Fund. The fund has grown to around $10 billion primarily from oil and gas taxes since it was set up in 2020.

    The sector generates about half of total state revenue.

    It will also draw from another large trust fund and seek appropriations from the Democratic-controlled state legislature.

    Research shows quality child care lifts education outcomes, especially among low-income families, according to Philip Fisher, a professor of early childhood learning at Stanford University.

    Reading levels of New Mexican students fall far below the national average when children are first tested around age 8 or 9, according to studies by Neal Halfon, professor of pediatrics at the University of California, Los Angeles.

    The Annie E. Casey Foundation has, for years, ranked New Mexico last among states in both education and child well-being.

    New Mexico joins countries such as Norway and Belgium that offer free universal child care for children under 3, and Bulgaria, where early childhood education is free for all children until elementary school. New Mexico is going further by offering no-cost child care for children up to age 13.

    Critics such as New Mexico State Representative Rebecca Dow, a Republican, say families should be given a choice between a monthly $1,200 state tax credit for a parent to stay home with a child – the equivalent cost of state-funded child care – or free child care. She said research showed the best place for a young child was at home in a healthy, safe household. Dow, the founder of a daycare center, supports targeted state-funded care where that is not the case.

    “Why not try a conservative approach of an equal tax credit for mom to be home?” said Dow, who sees a shortage of daycare slots hampering the universal program. “There is no capacity. People are going to be disappointed.”

    Reporting by Andrew Hay in New Mexico; editing by Donna Bryson and Rod Nickel

    Reuters

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  • Manufacturing Companies Are Helping Employees With Child Care. Should Your Company Join Them?

    Manufacturing Companies Are Helping Employees With Child Care. Should Your Company Join Them?

    Child care remains a constant concern for American workers, as costs soar and some companies insist on return-to-office mandates, backing away from some of the more childcare-friendly remote and hybrid working models that were adopted almost universally during the Covid pandemic. Now a new report says that, in response to changing child care demands from employees, some big manufacturers are directly investing in child care support for employees. It’s a shift that might prompt you to reconsider some of the workplace perks your company offers, in the hope of helping your staff and also attracting talented job applicants. 

    The report, at industry news site HRDive, includes a story about a human resources worker at Iowa-based agricultural equipment maker Sukup Manufacturing Co. struggling to juggle work, commuting and child care — because the care facility was 45 miles away from her workplace. Emily Schmitt, chief administrative officer and general counsel at Sukup told HRDive that the struggle eventually became too much for her and she left. Schmitt also said that at the time the company was “having issues of people not being able to stay employed in our Sheffield location because there wasn’t child care availability” nearby, or at all — the report says about 23 percent of state residents live in “child care deserts.”

    So Sukup formed an alliance with the local school district and bank, sought and won a matching grant from the state to complement the $1.25 million the group was injecting into creating a new child care center, and built their own facility, with space for 112 children.

    The report notes that this small manufacturer is just one example of a slow-developing trend, with major companies like Toyota and Intel in the lead. These big name manufacturers are said to be “expanding their partnerships with child care providers,” partly to boost workplace culture (working parents are likely to be less stressed if they know their children are being looked after nearby during the working day) and also to retain workers. The report quotes a study from the Manufacturing Institute where almost half the respondents said working hours flexibility (friendly to ever-changing childcare needs) was an “important” reason for them to remain with their particular employer.

    But it’s not just in the manufacturing industry that leaders are thinking about better support for working parents. In March this year, Citigroup CEO Jane Fraser landed her financial services company in the spotlight for good reasons: Fraser had made a deliberate choice to shun the industry’s RTO trend and instead retain some flexible working rules that had been in place during the pandemic. It wasn’t merely a phase, Fraser said, and it was instead a “new way of working.” Fraser also said that she was using the policy as a way of attracting working parents to her company — it offers Citi a “competitive advantage” in the job market, Fraser says, because it’s appealing to talented working mothers who may not be keen to return to work under rival banks’ stricter in-office working rules.

    In May an Associated Press report also noted numerous U.S. companies were offering on-site child care due to the “fraught” child care landscape.

    All of this may prompt savvy company leaders to ponder if they’re supporting their staff with children properly. Because there are numerous benefits to be had. In April last year, a report from Small Business Majority, a small business advocacy group in Washington D.C., found that 59 percent of small business owners said that barriers to child care access were impacting their business, blunting growth opportunities.

    A quarter of founders admitted they’d had to shut down their companies and return to working in more traditional employee roles because they couldn’t juggle child care and work. And in July an expert reported that some companies are seeing an effective return on investment of $4 for every $1 spent on supporting their working parent employees. 

    In a tumultuous working world, rocked by stresses like layoffs, ever-encroaching AI and other social and political upheavals, supporting your working parent staff may be a very sound business policy—those workers are stressed enough without having to worry about who’s looking after their kids.

    Kit Eaton

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