Childcare costs have been rising since 1990 and far outpacing even the high rate of inflation, an audit firm report determined.
The report published Tuesday by accounting giant KPMG showed childcare costs skyrocketed 263% between 1990 and April 2024. During the same time, the consumer price index, a parameter used for measuring inflation, rose by 133%.
"The childcare crisis, which was simmering prior to the pandemic, has come to a boil," researchers said in the report.
In an interview with Marketplace, Diane Swank, chief of economist at KPMG, noted: "It really gets to the issue that parents are really stuck in right now — the largest generation, I might argue, of 30-somethings we've ever seen."
"We've got 12,000 millennials turning 35 every day. And they're in the thick of this, trying to pay for childcare costs," she said, pointing out the government has said "you should pay maybe 7% of your income for child care costs."
Women who have younger kids also have a lower labor force participation rate when compared to others, KPMG's research found.
For example, moms with children younger than 6 had a labor participation rate of 69% last year, compared with 95% of similar fathers. Similarly, women with kids between 6 and 17 had a labor participation rate of 78% compared with a 92% rate for men, The Hill reported.
The consumer price index published in February showed childcare costs increased by 3% between December 2022 and December 2023. Preschool and daycare costs rose by 4.5 % during the same period.
"This report provides a deep dive into the childcare crisis, its breadth, who it is hitting the hardest and how it is undermining potential business and overall economic growth," KPMG wrote in an introduction to the stats. "Recent economic gains are only papering over a much more deep-seated problem. There are solutions, with companies and states stepping up to the plate."
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