Latest news with #CorrineHendrickson
Time Magazine
3 days ago
- Business
- Time Magazine
Why So Many Childcare Centers Are Closing
For nearly 18 years, Corrine Hendrickson has run a family daycare out of her home in rural Wisconsin, navigating the low pay and long hours because she loves the job. But at the end of August, before a new school year begins, she's shutting down Corrine's Little Explorers for good. With the disappearance of federal and state subsidies that kept her afloat for the last few years, she says, the model no longer works, and she doesn't want to have to choose between raising rates or taking a pay cut. She's not alone: in Wisconsin, other childcare centers are closing ahead of the new school year. 'We're getting to an inflection point,' she says. 'I think enough of us are going to close that they're going to have to do something.' Across the country, childcare centers are struggling as they never have before. A perfect storm of rising costs, worker shortages, and the expiration of federal and state grants makes it extremely difficult for these businesses to operate. Childcare has long been in crisis. Overhead costs like buildings and liability insurance are expensive, and to take care of young kids, centers need a lot of staff, which means they have to spend a lot on payroll. But they also can't charge too much money, or families will drop out. 'Childcare is a textbook example of a broken market,' said Janet Yellen, back in 2021 when she was Secretary of the Treasury. Read More: Why So Many Women Are Quitting the Workforce But for all the struggles of childcare providers in recent years, the pandemic provided an unlikely source of hope. The American Rescue Plan included $24 billion for a Child Care Stabilization program that helped 220,000 centers keep paying wages, benefits, rent, utilities, and other costs. Another $15 billion went to help expand access to childcare. Some of that funding expired in Sept. 2023; the rest expired one year later. And while some states were able to move around federal funds or pass temporary legislation to financially support childcare facilities, that funding is expiring in much of the country. 'It was already a non-sustainable business model, and it got even worse,' says Julie Kashen, senior fellow and director for women's economic justice at the Century Foundation, a left-leaning think tank. 'The pandemic funding really helped prop it up, but ultimately turned into a bridge to nowhere.' Indeed, Corrine Hendrickson said she was actually most solvent during the pandemic; the federal funding even allowed her to hire an extra substitute employee. But, she says, she had been thinking of getting out of the childcare business leading up to the pandemic. She only makes a profit of $20,000 a year, which is an extremely low salary for all the work she does. When it became evident that neither the federal nor state government was going to continue to support childcare providers in Wisconsin, she says, she decided to close her business. The end of funding appears to be leading to many closures. North Carolina, for example, was able to stretch its federal pandemic dollars through June 2024. But after that, 43 centers across the state closed, according to Candace Witherspoon, director of the division of child development and early education in North Carolina. The state was able to release some stopgap funding that lasted through March 2025, but when that ended, even more programs closed. The state has seen 158 programs shutter since the beginning of the year, she says. Read More: 'People Are Going to Die': Cuts Leave Domestic Violence Support Groups Reeling The federal funding allowed many centers to raise pay from $11 an hour to $14, Witherspoon says, but even the higher rate is not enough to attract and retain workers when fast-food restaurants and other businesses pay considerably more. About half of childcare providers in the state aren't able to offer health insurance for their workers, and about 43% of childcare workers in the state are on some form of public assistance like Medicaid and food stamps. Yet demand for childcare is high. 'North Carolina is in crisis because many of our parents are being forced to leave the workforce' since they can't find care for their children, Witherspoon says. In North Carolina, there's only one infant and toddler spot for every five families applying for care. When childcare centers close or parents are unable to find a spot for their children, one parent—usually the mother—often drops out of the workforce to care for the kids. Between the second quarter of 2023 and the third quarter of 2024, the number of people who reduced their hours to part-time or who left the labor force altogether due to childcare rose 43%, according to the Federal Reserve Bank of Kansas City. One analysis of the childcare stabilization funds dispersed during the pandemic found that they helped the mothers with young children stay in the workforce. About 26% of the money spent to stabilize childcare actually ended up back in the government's coffers through tax receipts. As federal and state dollars expire, the childcare business is getting even tougher. Inflation is driving up costs like rent and insurance. Labor is becoming more expensive, and providers are facing more competition from other businesses that can pay better. And roughly 20% of the childcare workforce is made up of immigrants, which means that the Trump Administration's deportation campaign is affecting some workers. One childcare provider in Seattle, for instance, was recently detained by ICE. Read More: Positive Economic Data Is Still Hiding Bleak Reality for Many Families The cost of childcare now exceeds the price of college tuition in 38 states and Washington, according to an analysis conducted by the Economic Policy Institute, a left-leaning think tank. Meanwhile, the median wage in early care and education falls below 97% of other occupations, according to the Center for the Study of Child Care Employment at the University of California, Berkeley. The median wage is $13.07 an hour, but ranges from $10.60 in Louisiana to $18.23 in Washington, D.C. For many providers, raising prices is not an option. Already, prices have grown by 29% since 2020—faster than overall inflation, according to Child Care Aware, an advocacy group. 'If I raise tuition, will I lose too many families to stay afloat? If I don't raise tuition, will I be able to stay afloat?' says Meghann Carrasco, the founder and executive director of Seedlings to Sunflowers, a nonprofit childcare provider in Maine. The center used the pandemic funding to stay open for all but two months during the pandemic, and is now struggling because its Pre-K program is under-enrolled. The center raised prices 16% this year, the most it has ever raised tuition, and lost some families who couldn't afford it, Carrasco says. Even with the tuition increase, Seedlings to Sunflowers was only able to stay open because it embarked on a fundraising campaign in its community, securing $25,000 in interest-free loans and donations. 'The amount of programs closing daily is more than we've ever seen,' Carrasco says. Read More: Why So Many Seniors Can't Afford Long-Term Care Most providers say that without federal or state funding, they do not have a long-term future. Federal funding for childcare was close to becoming a reality in 2021, when the House passed a child care solution in the Build Back Better Act, but it was stripped from the next version of the bill, which became the Inflation Reduction Act. Democrats in Congress introduced a bill in April 2025 that would increase federal spending on childcare, but it's unlikely to go anywhere, especially in a political climate where some Republicans are backing policies that encourage more mothers to stay at home. For now, says Kashen of the Century Foundation, childcare providers have to hope that their states will help them survive. This creates a patchwork system where providers in certain states—often blue states—will stay open and educate more children, while others, in red states, will close or only stay open for people who can afford it. New Mexico, for instance, passed a constitutional amendment in 2022 guaranteeing the right to early childhood education. The state devoted a portion of money from oil and gas development fees to early care and education, amounting to about $150 million a year for early childhood education programs. Vermont passed Act 76 in 2023, which will fund childcare through a 0.44% payroll tax; Massachusetts added half a billion dollars in funding for childcare providers in 2024; and Connecticut passed a bill in 2025 that creates a new endowment for early childhood education. Most states, though, passed nothing at all.
Yahoo
15-05-2025
- Business
- Yahoo
Wisconsin is Cutting State Funding for Child Care. Providers are Taking a Stand.
On Monday, child care providers across the country participated in the fourth annual Day Without Child Care, closing their doors and gathering to demand a better child care system with more public dollars. In Wisconsin, some providers may remain closed for quite a while longer, according to Corrine Hendrickson, owner of a family child care program in Wisconsin, and one of the organizers of a prolonged protest — dubbed 'State Without Child Care' — which intends to push back against the state legislature's cuts to essential child care funding. While direct actions — a form of activism that uses strikes or public demonstrations — by child care providers remain relatively rare in the U.S., it may be an increasingly important arrow in the quiver when fighting for the system children, parents and providers need and deserve. At issue in Wisconsin is the fate of the state's child care stabilization fund, known as Child Care Counts. Wisconsin is one of six states that doesn't fund child care, relying instead entirely on inadequate federal funding. That temporarily changed during the pandemic, when providers began receiving regular payments through Child Care Counts that allowed them to maintain operations and kept parent fees from spiking. With these pandemic funds drying up, Gov. Tony Evers proposed $442 million over two years to continue the fund, but last week the Republican-controlled joint finance committee voted to zero out the child care money. Get stories like this delivered straight to your inbox. Sign up for The 74 Newsletter If this funding ends, there will be massive consequences for children, families and providers, which is one reason providers are engaging in such an unprecedented action. As the Milwaukee Journal-Sentinel reported, 'A quarter of child care providers are more likely to close without further funding from Child Care Counts, and those that remain could be forced to raise their rates, according to a survey released April 10 by the Wisconsin Department of Children and Families.' This does not appear to be hyperbolic: funding reductions to Child Care Counts over the past few years have already caused providers to increase fees and to have more difficulty hiring qualified staff. Providers have seemingly had enough. Hendrickson stated in a press release that, 'While politicians negotiate over our funding and our lives, Wisconsin working families are once again left without. We've done everything we were told to do. We called. We showed up. We shared our stories. And still, lawmakers voted to cut child care from the budget. No plan. No replacement. No respect. We've had enough and we are drawing the line.' Providers across the state began protest actions in Madison on Tuesday, May 13, and according to Hendrickson, some will remain closed until the legislature guarantees they'll restore the child care funding. Single day child care protests are increasingly common. These have been seen in Australia and Ireland, and they have proven useful at garnering media attention — in fact, the 2020 Irish protest is credited with making child care a major campaign issue that year. These have also occurred regionally in the U.S.; for example, in Connecticut in 2022, providers organized a 'Morning Without Child Care,' which became a landmark event that sparked other communities to follow suit via the now national Day Without Child Care. The Wisconsin protest sets itself apart from these one-day actions though, in that the intention is sustaining activism until the state legislature meets a specific demand. Perhaps the most notable modern example of a sustained child care work stoppage comes from Germany. In 2015, German child care staff across the country went on strike for four weeks to protest their low wages, marking one of the nation's largest post-reunification labor actions and making international headlines. (The strike ended with a modest salary increase.) Similarly, in 2004, Scotland saw a strike of 5,000 child care educators that dragged on, in some localities, for more than three months. One structural element that has made direct child care actions in the U.S. less common than in other nations is the fact that there is less government involvement to begin with. Both German and Scottish child care workers are largely hired by — and have their wages set by — municipalities, and most workers belong to a labor union. In the highly privatized and fragmented American system, there is little unionization and the divisions between employers and employees can be fuzzier; in fact, in many cases it is the owners of U.S. child care programs that are protesting. However, both Connecticut and now Wisconsin have been able to tie their demands to state legislative action, with the presence or lack of state funds for child care acting as a sort of stand-in for collective bargaining. That said, the Wisconsin providers face challenges ahead. While the movement has received support from the community organizing group Community Change, the providers are not unionized. There is no standing strike fund, and for programs operating on thin margins, every day the doors are closed poses a significant loss of revenue. And of course, the participants would much rather be providing care and learning to the children in their programs. Participating in sustained closures is emotionally fraught. For early educators, it's difficult to deprive families of a vital service they rely on. For families who will feel the impact, it's expected that reactions will vary, but looking at Connecticut as an example, parents made it clear that given the choice between a temporary stoppage and permanent closure, reduced quality, or unaffordable fee hikes, they will generally stand alongside their child care providers. Child care providers in the U.S. have long advocated passionately for more support, but have rarely engaged in prolonged protests. In Wisconsin, we're about to find out whether sustained activism is a tool that can sway policymakers.
Yahoo
14-05-2025
- Business
- Yahoo
Republicans favor expanding employer child care tax credit; providers skeptical
Corrine Hendrickson, child care provider and advocate, waits to speak at a rally in front of the state Capitol Tuesday, May 13. (Photo by Erik Gunn/Wisconsin Examiner) Republican lawmakers have filed a proposed bill expanding an existing state business development tax credit related to child care. Child care providers who want to see a permanent state investment in their work said the bill was an inadequate gesture. The state's current business tax credit for child care applies only to capital expenditures for an employee child care program. The proposed bill would expand that to include other costs, including operating a child care program for employees, reimbursing employees for child care costs and other costs related to child care benefits. 'These changes will increase the number of available child care slots and provide more options for families,' wrote Sen. Howard Marklein (R-Spring Green) and Rep. Karen Hurd (R-Withee) in a memo seeking cosponsors. 'While not a silver bullet, these changes are another step in the right direction to address the child care issue in Wisconsin.' Critics dismissed the measure as inadequate. In a press release Rep. Randy Udell (D-Fitchburg) sent out after the Assembly's floor session Tuesday, he noted that last week the Legislature's Joint Finance Committee 'shot down 612 budget items including $480 million in childcare funding, and they proposed a childcare tax credit in its place that would benefit corporations instead of childcare providers under threat of closure.' Shawn Phetteplace, national campaigns director for Main Street Alliance, sent a memo to lawmakers Tuesday also dismissing the proposal. 'Providing a 15% refundable business tax credit for businesses providing child care benefits will not appreciably increase access to child care for Wisconsin workers,' Phetteplace wrote. 'It will simply be another tax break for large corporations. A similar credit exists at the federal level, the 45F credit, which is widely regarded as not achieving the goal of increasing affordability and accessibility to childcare for employees.' Corrine Hendrickson, co-founder of Wisconsin Early Childhood Action Needed (WECAN), said at a Capitol rally Tuesday she would like to meet with Marklein, who cochairs the finance committee, as well as Rep. Mark Born (R-Beaver Dam) the other cochair. The business tax credit is refundable: The credit recipient receives the full value of the credit back from the state, even if it is more than what the recipient owes in taxes. Hendrickson criticized the lawmakers for 'refusing to do the same for our hard-working families with the child and dependent tax credit.' The state's child and dependent care tax credit for families, which was expanded in legislation enacted in March 2024, is not refundable. That effectively makes the tax credit worth much more to people with higher incomes than to those with lower incomes, as the Wisconsin Examiner has previously reported. 'We are not going to accept anything more that will entrench the wealthy and well connected into our system of having success in life,' Hendrickson said. Born issued a statement this week that declared Republicans were focusing on other alternatives to the proposal for $480 million in subsidies for child care providers. 'Legislative Republicans have consistently supported a targeted approach to helping families afford child care, build provider capacity, and support recruitment of child care professionals,' Born said. 'Parents are best equipped to make decisions about the needs of their children and Legislative Republicans are committed to providing parents with options, helping families directly make child care more affordable.' Born said the Legislature spends 'almost $1 billion' for child care. Hendrickson said that virtually all that money is from the federal government and simply passes through the state budget. Only about $24.4 million comes from the state as a required match. SUBSCRIBE: GET THE MORNING HEADLINES DELIVERED TO YOUR INBOX
