Childcare Disruptions Are Costing the U.S. Up to $70 Billion a Year. But Companies Supporting Parents Can Turn It Around
That childcare is cripplingly expensive has been well-established: It can consume up to 40% of household spending, totaling about $30,000 a year as a family’s largest expense. It’s why even families making $400,000 are struggling with childcare, and why it now costs over $300,000 to raise a child to the age of 18 in the U.S.
And it’s not only the bane of every parent’s existence, but of most businesses, too.
Thats because childcare disruptions — a shuttered daycare, a sick nanny, no affordable last-minute sitter — are costing the U.S. up to $70 billion a year in lost productivity, turnover, and absenteeism among foundational workers (in healthcare, education, manufacturing, retail, and hospitality), according a report released Wednesday by Moms First, a nonprofit fighting for paid leave and affordable childcare.
“As companies race to adopt AI, the foundational workers our entire society depends on aren’t going anywhere,” said Reshma Saujani, founder and CEO of Moms First, in a press release. “Without childcare, they can’t work. When a nurse can’t find last-minute care, that’s a shift missed. When a teacher’s daycare closes, a classroom goes unstaffed. If companies want a chance at growing in an era of disruption, investing in childcare is one of the smartest bets they can make.”
The “Foundational Workers Report” was released by Moms First’s National Business Coalition for Child Care, a growing network of companies prioritizing childcare, with analysis by McKinsey & Company. It draws on a national survey of 1,700 working parents, plus census and labor market data and interviews with leading employers across the nation — within the context of U.S. companies facing historic instability due to AI, automation, and global chaos.
What better way to create some stability, the report concludes, than to make reliable and affordable childcare accessible?
At the core of that opportunity, the research shows, are foundational workers, who account for about 80% of the U.S. workforce — and approximately $35-45 billion of that $70 billion loss, which is roughly the size of Netflix’s annual revenue. That, the report notes, makes access to reliable and affordable childcare a necessity for the stability of the American workforce and economy.
Key findings of the Mom’s First report include that…
- Foundational workers account for $35-$45 billion, or 60 percent, of total employer losses from childcare disruptions.
- Nine in 10 parents say childcare disruptions have caused them to miss work, reduce hours, leave a job, or exit the workforce.
- Addressing the gap would have an economic impact comparable to adding roughly one million full-time workers to the U.S. labor force.
- Targeted employer-interventions can have an average return on investment of 5-300% or more
While addressing this country’s childcare crisis depends upon a huge change in public policy, the report shows how companies can take — and are taking, in many cases — practical steps to ensure their workers have childcare.
Examples of pioneering companies already walking the walk include:
- Chobani: The yogurt and oat milk maker, which has around 4,000 U.S. employees, offers 10 days of backup care a year and a $1,200 annual stipend through a platform called Upwards.
- Hilton: The hotel brand, with over 500,000 employees, partners with online care coordination service Wellthy to match workers with a dedicated care coordinator who can deal with tasks from arranging backup childcare to finding a therapist for your teen.
- JBS: A food company with over 150,000 U.S. employers, JBS offers discounted care with extended hours aligned to shifts, plus transportation and summer programs.
- Simple Modern: This retail company provides a $6,000 annual childcare stipend to its employees.
- The University of Arkansas for Medical Sciences: UAMS opened a Child Development Center run by Bright Horizons in 2024, providing full-time care for kids up to 5 for any employee or student combining employer subsidy with a sliding scale and state vouchers.
“We often think about infrastructure as roads, ports, or power grids — but childcare plays a similarly critical role,” said Ramya Parthasarathy, Partner at McKinsey & Company. “It enables millions of workers to participate in the economy each day, and when access is disrupted, businesses see the impact through absenteeism, turnover, and lost productivity.”