Kiley Russell, founder of Kemit Academy in Chicago’s Hyde Park neighborhood (Photo Provided).
By Nicole Jeanine Johnson
Rosia Watson has been in the childcare industry for nearly 25 years. She’s watched generations of children go from learning to walk to walking across stages at graduations.
“I do it for the love of the children and their parents.”
Watson prides herself on the quality of care she offers her children. Before starting her Englewood-based home childcare business, she worked the graveyard shift at the Cook County Hospital.
There, she noticed how distressed parents looked coming into work, lamenting over leaving their children with people they didn’t know. She wanted to help alleviate parents’ burdens, allowing them to be confident that they left their children with someone who made them feel loved and cared for.
“We treat them [children] like they’re family.”
Watson primarily serves Black children but recently started caring for children who come from Spanish-speaking homes. When the pandemic shed light on the fragility of the childcare industry, the federal government sent $52 billion to states to keep childcare centers and home centers open, retain staff and offer services. This funding is expected to expire on Sept. 30.
However, Senate lawmakers introduced the Child Care Stabilization Act, which could maintain the funding that is at-risk. The bill would provide a $16 billion annual federal investment.
Despite this possibility, Gov. J.B. Pritzker has championed innovations arising from these federal relief funds, which will give greater sustainability to the existing childcare workforce and fortify a pipeline for those seeking a secure career.
A Historic Investment
The pandemic and society’s critical dependence on essential workers revealed that available and affordable child care is a linchpin to our society and promotes the vitality of our economy.
“I kept my doors open during the pandemic, even with limited capacity. My parents had to work; they were essential,” Watson recalls.
Congress’ 2021 childcare investment was the largest in the nation’s history. Providers could use funds to pay for overhead costs such as rent/mortgage, staff wages, equipment and additional personal protection equipment.
“I gave my staff and myself a bonus and hired a Spanish-speaking educator so I can speak to my students and their families. I’ll have to cut down my assistant’s hours and possibly let go of my Spanish instructor,” she laments.
Between 2021 and 2022, through multiple disbursements, Illinois granted close to $73 million to Black Chicago area providers or nearly 8% of the $980 million in federal funding leveraged to help the childcare industry recover and stabilize throughout the pandemic.
Average grant sizes were $60,000 and $12,000 for daycare and home daycare centers, respectively. The gap in average grant size alludes to the disparity in the support offered to centers versus home childcare providers.
Across Chicago’s Black communities, just under 4,000 home daycare centers are primarily founded by Black women.
For most, like Tina Hammond, founder of Tina’s Treasures Childcare, located in her West Englewood home, their centers are their primary, if not sole, source of income. This leaves little money to support themselves once the center’s operational costs are met.
“Once I pay everything: bills, workers and food, I find that my husband and I still have to split our copay between his income and mine.”
Tina Hammond, founder of Tina’s Treasures Childcare in Englewood (Photo Provided).
Even Watson cautioned that she didn’t want to share how much she made after expenses.
“I might get away with $1,000 a month, sometimes.”
According to Rachel Otwell, Illinois Department of Human Services Director of Communications, the department “is in the process of evaluating the existing model through extensive surveys and focus group conversations with child care providers.
The cost model will be used to determine award amounts necessary to support providers in raising wages to a wage floor.”
According to a 2019 report from the Center for the Study of Child Care Employment at the University of California-Berkeley, 75% of Black home child care educators earn less than the national median income, compared to 59% of all other races and ethnicities.
Inadequate Childcare Investment Creates Industry Instability
In 2022, IDHS increased the maximum daily subsidy rates to $67.00 and $47.96 per child for Cook County daycare and in-home centers. Funds are intended to pay for children’s food, equipment, staff and any costs associated with maintaining safe and quality operations, including rent/mortgage and utilities. The meager amounts amplify a source of instability for the industry.
According to a 2021 report from the Illinois Commission on Equitable Early Childhood Education and Care Funding, the state’s current investment meets only 14% of the need.
Some daycare centers, like Hyde Park Kemit Academy and Pediatric Therapy, have the flexibility to diversify their source of income to offer an enhanced educational experience for their children and families.
Founder Kiley Russell shared that her center has a yearly investment of $25,000 per child.
Russell started her center 17 years ago when she realized there weren’t adequate services for her child, who had special needs at birth. At the time, children with childcare subsidies were the bulk of her budget. But due to political instability in Springfield, she’s shifted her business model so that out-of-pocket payment contributes to 90% of her budget.
“I’ve been doing this for so long, and I’ve dived into the numbers to figure out how to provide an awesome and affordable program.”
However, this proves to be a challenge.
“They [the state] pay $67 a day. So, if you divide that by ten hours in daycare, that boils down to $6.70 an hour per child. No one is going to work for that wage.” Russell decries that providers are being paid “slave wages essentially.”
“There’s no way you can provide care for a child for $6.70 an hour.”
Uncertain Economic Future
Like the children they serve, many childcare providers are aging out of their prime working years.
At age 67, Watson would like to retire, but it won’t be the “desired retirement” that offers peace of mind. “[I want to be able] to have something to put aside for myself to retire, but I don’t have a [traditional] retirement [plan].”
“I’ll get a little part-time job doing something. Something that’s not strenuous that I don’t have to do a lot of work at.”
Hammond, 57, shared that she will have minimal retirement benefits from her previous employer, but it’s not substantial enough to fully support her. She’s considering closing her home center and getting a job at Chicago Public Schools to pay into social security and have more benefits.
The economic insecurity also makes it challenging to hire and employ qualified workers.
“I’d like to pay my assistant what she’s worth,” Watson said. But the state’s investment doesn’t make that possible.
In recent years, Russell has run into unsavory practices with her hired staff.
“You have people that will daycare hop. They’ll stay long enough if you are offering a bonus or whatever incentive, and then they’re on to the next daycare to try to negotiate the same. And they can do that because there’s such a widespread shortage. Everyone in the world is still short of staff, but as the world has been able to find solutions, there aren’t many [solutions] for childcare providers. And cutting federal spending makes it even worse.”
In the UC Berkeley report, 84% of Black daycare center educators nationwide earn less than $15 an hour. In recent years, Illinois became the fifth state to adopt a $15 minimum wage.
The scarce investment incentivizes daycare workers to take their labor and follow the money. This creates a precarious work environment and makes operating a center unstable.
Russell wishes she could pay her workers a commensurate salary based on their education and credentials. But “all of that would be fair if the state paid child care providers a fair wage, and they do not.”
The UC Berkeley Center for the Study of Child Care Employment reports that 53% of childcare workers across the country rely on public income support to supplement their childcare wages to support themselves and their families.
Pritzker’s Move to Stabilize the Industry
Gov. J.B. Pritzker speaking at one of his Smart Start Illinois education tour stops (Photo Provided).
For the 2024 state budget, Gov. Pritzker championed the Smart Start Initiative to eliminate preschool deserts and stabilize the childcare workforce, among other priorities.
In this initiative, $130 million of state dollars, with additional federal funding, would be allocated for the Early Childhood Workforce Contracts. This investment will increase childcare workers’ wages and is the first of its kind in the nation.
The ECWC will likely draw more childcare workers to acquire credentials and pursue a career in this field. In the August 2023 Early Childhood Access Consortium for Equity (ENCASE) report, higher education early childhood programs saw a 17.9% increase in enrollment, totaling almost 500 new students. The majority of the 2,700 students maintained their enrollment in either a bachelor’s degree or an applied associate’s program.
“The cornerstone of Smart Start Child Care is funding to help child care providers to meet a required wage floor for staff that is higher than what providers can typically offer with current revenues,” IDHS states.
In addition to the initial 2024 investment in the Smart Start Initiative, the state is working to ensure long-term investment in 2025 and beyond. The initiative will allow providers like Ms. Watson to offer competitive wages to more qualified staff, increase her take-home pay, and possibly contribute to her retirement.
Overall, this will ensure a qualified talent pipeline to provide children with an enriching educational experience during a critical developmental stage.
“I must say that Governor Pritzker has been the best governor that we’ve had that’s supported child care,” Watson said, beaming.
Nicole Jeanine Johnson is a writer and emerging multi-media journalist specializing in issues at the intersection of politics, race, equity, education, and wellness. She is also a published author of her debut inspirational memoir, Of All the Lives I’ve Lived: This Is My Favorite (New Degree Press, 2022), under the pen name Lotus Hale Hill. Nicole holds a Master of Science in Education Policy from the University of Pennsylvania, a Master of Arts in Teaching from National Louis University, and a Bachelor of Arts in Political Science from the University of Michigan.