Long before reaching their third trimester, many Americans find themselves already languishing on multiple childcare waitlists.
Not because she was careless or disorganised or late to understand how the childcare market works. Because she had done exactly what every experienced parent in her city had told her to do: get on the lists early, get on multiple lists, and be prepared for the reality that the earliest available opening might not align with when she actually needed care. The advice was good. The market was still impossible.
The earliest available opening at any of the three centres she had applied to was fourteen months out from her expected due date. Her baby would be walking, possibly running, before any of the spots she was competing for became available. And the cost, when those spots eventually opened, would be $1,650 per month. Per child. Which is $19,800 per year. Which is more than in-state tuition at the University of California system, which charges approximately $14,300 per year in tuition for undergraduate students at its nine campuses.
This comparison — between the cost of infant care and the cost of a university education — is not a rhetorical flourish. It is a data point that the American Enterprise Institute's 2025 childcare regulation and affordability report documents with precision: infant centre-based care in California averages $19,547 per year and in New York averages $19,584 per year. In Massachusetts, the figure reaches $20,913 annually. In Washington DC, it exceeds $24,000 per year. These are not the prices for luxury care in the most exclusive providers. These are the average prices for centre-based infant care, across providers of varying quality, in the markets where working families are trying to cobble together arrangements that allow them to maintain their careers and raise their children simultaneously.
The Price That Defines the Crisis
Average annual cost of infant centre-based care in New York State — comparable to or exceeding in-state tuition at the state's public universities. At this price, childcare is unaffordable for most of the families who need it, by any reasonable definition of affordability.
How the Price Got Here: The Structural Failures
Understanding how infant care came to cost more than college in the most populous states in the country requires understanding the structural features of the childcare market that make high prices both predictable and persistent — even in the absence of any intent to gouge families or any simple mechanism for reducing costs.
The labour cost paradox. Quality childcare requires a high ratio of trained adults to young children. Infants and toddlers, by every regulatory standard that reflects the developmental research on child safety and quality care, require more adult supervision per child than older children. The regulatory staff-to-child ratios for infant care — typically one adult for every three to four infants in most states — mean that the labour cost per child served is inherently high relative to care for older children. At the same time, the families purchasing that care are budget-constrained in ways that limit what they can pay. The result is a market in which providers cannot charge enough to pay workers adequately while remaining affordable for families, and cannot pay workers adequately without charging more than families can afford.
The St. Louis Federal Reserve's state-by-state analysis of childcare's economic impact documents the wage dimension with clarity: the median hourly wage for a childcare worker in the United States in 2023 was $14.60, compared to $23.11 for the median worker across all occupations. This wage differential is not a market signal that childcare workers are less valuable than other workers. It is a market signal that the childcare market is broken — that the price families can bear and the price required to adequately compensate workers are incompatible without external subsidy, which is why the countries that have solved this problem have solved it through public investment rather than market competition.
The regulatory cost structure. State childcare regulations — including staff-to-child ratios, square footage requirements, facility standards, and staff qualification requirements — add meaningful cost to childcare provision. The AEI's analysis of childcare regulation and affordability finds that regulatory costs are a significant contributor to the price of childcare in high-cost states, and argues that regulatory reform could reduce prices without compromising quality in some regulatory dimensions. These arguments deserve engagement, alongside the recognition that many regulatory requirements exist because quality childcare, particularly for infants, is genuinely expensive to provide safely.
The real estate dimension. In the urban markets where childcare costs are highest, commercial real estate costs represent a significant portion of operating costs for childcare centres. A centre operating in San Francisco or Manhattan is paying a very different occupancy cost than a comparable centre in rural Arkansas, and those differences are reflected in the prices families pay. The geographic concentration of high childcare costs in the major metropolitan areas where both employment and housing costs are highest creates a compounding challenge for the dual-income families who are most dependent on centre-based care.
The market concentration that limits competition. In many urban markets, the supply of quality infant care is so constrained relative to demand that the market operates closer to a seller's market than a competitive market, which removes the usual price-moderating effect of competition. When families are waiting fourteen months for an opening and would pay whatever the opening costs, the market dynamic does not produce the downward pressure on prices that competitive markets typically generate.
The Single-Parent Calculus: Where Impossible Becomes Clearest
The arithmetic of infant care costs in high-cost states is difficult for dual-income households. For single-parent households, it is simply impossible in the mathematical sense of the word.
A single mother earning $60,000 per year in California, which is below the state's median income, takes home approximately $4,200 per month after federal and state taxes. Infant centre-based care costs an average of $1,629 per month in California. That is 39% of her take-home income, devoted entirely to childcare before rent, food, transportation, or any other expense is considered. The US Department of Health and Human Services defines childcare as affordable when it costs no more than 7% of family income. The actual cost, at 39% of take-home income, exceeds that standard by a factor of more than five.
For single mothers, who represent 28% of all mothers with young children and who are disproportionately in lower-income employment, the childcare affordability calculation does not produce a difficult budgeting exercise. It produces a decision between working and not working that is made on the basis of pure arithmetic, with results that the KPMG Great Exit report has documented in aggregate: mothers are leaving the workforce in record numbers, and the childcare economics are a primary driver.
What It Looks Like When It Works: Lessons From France and Scandinavia
The countries where childcare costs do not consume a substantial fraction of family income have not discovered a way to make quality childcare cheap. They have instead decided that the difference between what quality childcare costs and what families can reasonably pay is a public cost worth bearing, because the benefits of universal access to quality early care are widely distributed and because a society that says it values children and families should be willing to fund the care that makes both possible.
France's crèche system provides publicly subsidised centre-based care for children from birth to age three, with fees calculated on a sliding scale based on family income. The OECD's family policy analysis for France documents that maximum fees for high-income families cap out well below the unsubsidised market rate, with fees for lower-income families significantly less still. The difference between that fee and the actual cost of providing care is borne by the French family allowances system and by local municipalities. The result is a childcare system that is genuinely accessible to families across the income spectrum and that supports one of the highest rates of maternal workforce participation in Europe.
Sweden provides publicly subsidised childcare for all children aged one to five through its förskola system, with fees capped at a maximum of approximately 3% of family income. The OECD's analysis of Swedish early childhood education and care confirms that no family in Sweden pays more than roughly 3% of their income for childcare, regardless of the actual cost of providing it. The difference is funded through the Swedish tax system, reflecting a societal decision that early childhood care is a public good that should be broadly accessible rather than a private market commodity accessible only to families who can afford market prices.
Denmark provides publicly funded childcare with fees capped at 25% of the full cost of care, with the remaining 75% funded publicly. The OECD's comparative early childhood data shows the Danish approach consistently produces some of the highest rates of access to quality early care among OECD nations.
None of these systems are free. They are publicly funded, which means their costs are distributed through taxation rather than concentrated in the direct fees paid by the families using the services. The research on the economic returns to public investment in early childhood care and education — including the NBER lifecycle benefits study of early childhood programmes by Heckman, García, and colleagues, which found an overall return of 13.7% per annum and a benefit-to-cost ratio of 7.3 — consistently finds that the long-run returns to high-quality early childhood investment exceed the public cost by a significant margin, primarily through improved educational outcomes, higher adult earnings, and reduced expenditure on remedial education and social services.
What States Are Trying
In the absence of federal action adequate to the scale of the childcare cost crisis, several states have implemented programmes that represent meaningful attempts to address specific dimensions of the problem.
California's approach to expanding access to subsidised care is documented in Early Edge California's overview of the Master Plan for Early Learning and Care, which provides a roadmap for significantly expanding subsidised care and increasing the income eligibility threshold for childcare subsidies. California has also implemented wage supplements for childcare workers through its Child Care Initiative, which represents an attempt to address the labour cost paradox by increasing worker compensation without requiring providers to raise prices.
Massachusetts has raised its childcare subsidy income eligibility threshold to 85% of the state median income, significantly expanding the population of families eligible for subsidised care. The Massachusetts Department of Early Education and Care provides information on eligibility and application for childcare subsidies in the state.
New York City has implemented universal pre-K for four-year-olds and is expanding access to publicly funded care for three-year-olds through its 3-K for All programme, representing a meaningful investment in publicly funded early education that reduces the cost burden on families for the years the programme covers.
What You Can Do in the System That Exists
Research your state's childcare subsidy programmes. Most states have childcare subsidy programmes with income eligibility thresholds above the federal poverty line. Child Care Aware of America's guide to help paying for childcare maintains a directory of childcare financial assistance options by state. Apply if you may qualify.
Get on waitlists immediately. The market reality in high-cost cities is that quality infant care requires waitlist placement well before the baby is born. Start the research in the first trimester, not the third.
Understand your federal tax benefits. The Dependent Care FSA, the Child and Dependent Care Tax Credit, and the Child Tax Credit together can reduce the effective cost of childcare for eligible families. IRS Publication 503 covers the full range of available benefits and their eligibility requirements.
Consider care models that reduce cost. Nanny sharing, family daycare homes, and co-operative care arrangements can significantly reduce the per-family cost of quality infant care relative to centre-based options. Care.com and Sittercity are platforms for connecting families with caregivers for both traditional and sharing arrangements.
Advocate for policy change. Child Care Aware of America's policy and advocacy resources provide guidance on how to engage with state and federal policymakers on childcare affordability. The economic and social case for treating childcare as public infrastructure is strong. The political will to act on it requires sustained constituent pressure on the people who make the decisions.
Where It Went Wrong, and What It Would Take to Fix It
The childcare cost crisis did not arrive from nowhere. It is the predictable consequence of decades of policy choices that treated childcare as a private market commodity rather than a public good, that failed to fund the care workforce at a level that would attract and retain qualified workers, and that left the arithmetic of quality infant care incompatible with the income of the families who needed it most.
What it would take to fix it is not mysterious. The international evidence is clear about what works: public subsidy sufficient to bring the cost of quality care within the reach of all families, combined with adequate compensation for the workers who provide that care. The barrier is not knowledge. It is the political decision to treat the care of very young children as someone else's problem, which has produced, in the most expensive childcare markets in the country, a system where infant care costs more than college.
The baby on the waitlist does not wait for the policy conversation to resolve. She needs care in fourteen months, when the opening becomes available, at the price that the market has set. The market has set it at $1,650 per month. And the question of whether that price is something the country is willing to change is a question about values, not about capacity.
