The Kentucky Chamber of Commerce says the state could help more residents enter the workforce — and boost one of the nation's lowest workforce participation rates — by addressing ballooning costs for child care and access to those services.
A study the group published in August found that if average child care costs were reduced by $500 a month, around 16,000-28,000 Kentucky adults could enter the state's workforce. That boost in workers could generate up to $1 billion in new wages.
Charles Aull is the vice president of policy for the Kentucky Chamber. He said while the connection between child care costs and workforce participation has always been broadly talked about, the state business advocacy association wanted to provide in-depth analyses of the direct impact lowered costs could have on the Commonwealth's economy.
"There's never really been an in-depth study to actually try to quantify how many parents could realistically join the workforce and get employment if childcare were more available and more affordable – and then if those parents join the workforce, what types of economic impacts might that see," Aull said.
In addition to spurring economic growth, adults entering or re-entering the workforce would help increase the state's adult workforce participation rate. According to the chamber's findings, Kentucky's average workforce participation rate of 80% is currently the eighth lowest in the nation.
Along with analyzing data about Kentucky's child care gaps, the Chamber of Commerce's study also suggested solutions to help reduce average cost of child care in the state.
Jennifer Washburn, who owns and operates iKids Childhood Enrichment Center in Marshall County, was part of a group of child care providers in the state who advised the chamber on how to go about lowering costs.
One solution the Kentucky Chamber study suggested was retooling and promoting state government initiatives like the Employee Child Care Assistance Partnership. That program has been active since 2023, and lets employers pay a portion of workers' child care costs, which the government then matches.
Although state government programs like this do not always cover the entire cost of care, Washburn said it helps alleviate some of the financial burden on working parents.
"Not always does the employer's amount and the state's amount together cover the entire cost of child care, but what it does do is it offsets that cost for that family, so that they do have some support," Washburn said.
According to the chamber's findings, a reduction of around $200 a month in costs could still bring in 11,000 new workers for the state. This means that if employers supply $100 a month, the total cost after state aid could provide a significant boost to the state's workforce.
The chamber notes, however, that costs of child care is only one of the problems Kentucky faces with child care. Another problem is the availability of care, especially in rural areas that primarily consist of smaller, privately-owned facilities.
According to a report conducted by the Buffet Early Childhood Institute, roughly 200,000 Kentucky children under the age of 6 with working parents are in need of care. The majority of those children live in rural areas.
Aull said to solve this problem, there needs to be a push for better childcare legislation in the state — which he says starts with first having clear, concise data that shows the benefits of investing in child care.
"The first part of fixing this problem starts with good data. We really need to be able to identify with clear precision where child care is most lacking and where it might most be needed. And we think this new study takes a really good step in that direction," Aull said.
Although the road ahead for some legislative action is long, Washburn said statewide awareness of child care challenges through these studies and initiatives such as Kentucky Pre-K for All show that Kentucky is "working to be a trailblazer" when it comes to bettering its child care system.
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