Why universal childcare is more than just affordability

While knocking on doors this week, I spoke with a mother to two young kids who told me that when they were both in daycare together, the costs were nearly $60,000. She worked all day to pay for someone to watch her kids so that she could work all day.

But, as she pointed out to me, it was still the right call. Even if all of her income went to childcare, she kept her career moving and her skills up to date. And this is why childcare should not be just as an issue of affordability as it often is, and more as a critical component of a modern economy.

Thanks for reading Inside a State Rep campaign! Subscribe for free to receive new posts and support my work.

The impact of not working

I can tell from my own experience how difficult it can be as a working parent, even with childcare.

My son was born around the same time that I launched my startup. Because the startup wasn’t going to pay all the bills, I also was doing freelance political risk consulting (mostly research and writing reports). My wife is a doctor and was working long hours at the hospital once she went back to work after 12 weeks.

One thing about being married to a doctor is that you know that their work days are almost always more important than yours.

She is seeing patients one after another, each of which needs her full attention, who cannot be easily rescheduled, and any mistake could literally kill them. I was sending emails trying to get people to demo my software product.

This meant that whenever our son got sick, or had an appointment, or daycare was shut that day, I was the one that stayed home with him. Luckily, my work was flexible enough that it rarely caused me any significant problems. But it did happen on occasion. And there was nothing I could do but apologize to the client, promise I’d get it done by tomorrow, and take the hit to my reputation for reliability.

But many people aren’t so lucky and they are forced to choose between working and parenting, either fully stopping or cutting back on hours and responsibilities.

As Nobel Prize winner Claudia Goldin and her co-authors on this paper write:

Much of the initial divergence between male and female earnings after a birth is due to a reduction in the hours of paid work of mothers. But a cascading often follows. Fewer hours at work when young result in less lucrative clients, fewer published papers, a lower probability of promotion, and reduced odds of making partner or obtaining tenure, to provide a few examples. Moving to a lower-paying firm for family-friendly benefits and management practices may improve the chance of climbing the career ladder, but at the cost of lower earnings. In addition, with fewer fully-active years of experience, even a static human capital model would predict lower future earnings.

They find that much of the cause of the earnings gap between men and women is caused by the lost opportunities suffered by mothers and the extra opportunities received by fathers who didn’t have childcare responsibilities. The paper studied people born around 1960, when parenting was more clearly divided by gender roles. For 2026, this can be interpreted as the penalty paid by being the primary caregiver.

Economic impact of universal childcare

There is always going to be a time commitment to raising a child that can interfere with work responsibilities. Right now on this campaign I know that as well as anyone. But allowing parents to continue to work, especially for those at the margin of staying home vs not staying home, or taking less hours, is enormous.

A recent paper looked at the expansion of universal pre-k on economic outcomes. Their findings were that:

Impacts vary across settings, with the largest effects in areas providing at least five hours of care per day. UPK increased aggregate earnings by about 0.6% overall, with each dollar spent generating roughly four dollars in additional earnings; this rises to 3%, corresponding to thirteen dollars per dollar spent, for expansions providing five or more hours of care. Accounting for state tax revenue alone, state Marginal Values of Public Funds (MVPF) range from 0.65 to 1.31, while the social MVPF, which also accounts for induced federal tax revenue, ranges from 1.77 to 3.53 across all programs and is infinite for full-time programs that generate sufficient state and federal tax revenue to fully pay for themselves. Results suggest that labor market responses beyond the canonical model that focuses on parents alone lead to sizable economic returns to early childhood education investments.

In short, investments in universal pre-k pay for themselves eventually by generating enough economic growth to generate enough state and federal tax revenues. You can see this in the below chart, where universal pre-k nearly doubles enrollment, leading to declines in time spent caring for children. And employment and hours worked all jumped after the introduction.

In Massachusetts, according to research from the Massachusetts Taxpayers Foundation, we lose $2.7 billion every year from inadequate childcare.

How to build it

Childcare eventually pays for itself. According to a 2022 memo from House Democrats, every dollar invested in early education pays back nine dollars in benefits.

The challenge is finding the money upfront for childcare.

It is an expensive proposition, there is no doubt about it. And as the New York Times showed recently, it’s getting more expensive.

How we build a system that helps families while staying within what the state budget can allow will be for a future newsletter, and certainly a subject for debate within the legislature. But I hope you’ll agree that the cost of childcare is not simply borne by exhausted parents trying to get through their days with as few meltdowns as possible. It’s carried by all of us who live in an economy that is not as productive as it should be if we lifted up those busy raising the next generations.