Most New Yorkers can’t afford childcare, driving young families out of the city, report finds

More than 80% of New York City families can’t afford childcare even as providers are struggling to survive and closing in increasing numbers, a think tank report finds.

The report, which was released by 5Boro Institute on Tuesday, calls on the Adams administration to address the growing childcare affordability crisis that the institute says is driving young families — particularly Black families — to leave the city. The report comes as the city deals with rising rents and eviction rates, surging child poverty numbers, and a safety net riddled with delays and limited services.

“The future of our city depends on the availability of affordable, high-quality childcare," said Grace Rauh, the institute's executive director, in a statement.

The report claims childcare is the largest monthly expense for many families, and that its costs often exceed their rent or mortgage. According to federal affordability guidelines, families shouldn't pay more than 7% of their household income to care for one child.

Yet the median cost of center-based childcare in Queens makes up a third of a family's income and nearly half of a family's earnings in the Bronx, according to the report. That often results in parents — usually mothers — leaving their jobs to care for their children and giving up on their long-term earning potential.

The city’s Economic Development Corporation estimated a $23 billion economic impact in disposable income and tax revenues from parents leaving the workforce or downshifting careers due to childcare issues.

“Access to affordable childcare is critical for today's workforce; without it, we risk losing the top talent we need to grow our local economy," said Jessica Walker, president and CEO of the Manhattan Chamber of Commerce.

The report finds that there also aren’t enough childcare providers to meet demand. There are more than twice as many children under 5 years old in the city than there are licensed childcare slots, and providers are struggling to keep their doors open.

More than 3,500 childcare programs closed across the state between 2020 and 2022, and that pattern is continuing, according to the report. Many are small businesses run by women and people of color that operate on thin margins.

The number of childcare workers dropped by 20% during the pandemic and a quarter of childcare workers — who are among the lowest-paid professions — live in poverty, the report says.

The 5Boro Institute is recommending the city help bolster the childcare workforce by prioritizing staffing vacancies and making it easier for providers to operate in the city. It is also calling on the Adams administration to expand access to free and low-cost care and better connect families to open seats in publicly funded programs regardless of their immigration status.