The cost of childcare has risen by 41% during the pandemic with families spending up to 20% of their salaries

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Inflation is a hot topic these days, but it’s not just the cost of candy that’s rising. Since the start of the pandemic, childcare costs have gone through the roof. Across the U.S., parents are seeing an average annual cost increase of 41% for center-based childcare providers, and spending an average of $14,117 annually, up from $9,977 pre-pandemic, according to data from a recent LendingTree report. Households with children younger than 5 were hit hardest by these increases, the report found.

Using data from the Center for American Progress on the costs facing center-based childcare providers and data from Child Care Aware of America on household childcare expenses, LendingTree quantified the household impact of ensuring kids are cared for while parents are at work.

Since the pandemic began, center-based care providers for 3- and 4-year-olds have seen their annual costs increase by 57%. Costs for center-based care providers for kids under 2 grew by 37%.

Care providers for 3- and 4-year-olds in Georgia, Florida, and Louisiana saw the biggest jump in expenses, with an annual average increase of at least 144%.


As for the direct impact on households, Indiana families with kids under 5 put the biggest chunk of their income—20%—toward childcare, with the average family spending $11,212 a year. Vermont families are close behind, with 19% of their paycheck—an average of $13,538 annually—going toward childcare.

Families in New Jersey, Mississippi, Kentucky, Texas, and North Dakota pay the lowest portion, at 11%. But they may also be seeing a jump in their costs in the near future; in each of those states, the average care center saw its expenses increase by over 50% during the pandemic.

The bulk of the increased costs stems from staffing, which the Center for American Progress says makes up 70% of a childcare provider’s total budget.

“Keeping kids safe during a pandemic isn’t cheap,” Matt Schulz, LendingTree’s chief credit analyst, said in the report. “So much more is being required of these centers during the pandemic, and these new, tougher safety guidelines from governmental agencies have forced them to ramp up their spending in order to comply.”

In order to abide by a state’s safety measures, many centers have had to limit enrollment This leads to fewer paying families, which in turn leaves the centers with little choice but to pass the costs on to the families who stay, Schulz said.

“For many parents, removing a kid from their day care is the last option they’d want to consider,” Schulz said. “The unfortunate reality for many American families is that one of the few realistic ways to reduce costs on childcare is to have one of the parents stay home with the child full-time.”

These increased costs have disproportionately impacted working mothers, who, according to a Pew Research Center study released last week, are significantly more likely to leave their jobs when families lose access to childcare.

These women make up a large portion of workers taking part in the Great Resignation. About one in three moms has left her job since the beginning of the pandemic, according to an August 2021 survey by consulting firm Seramount, which focuses on workplace inclusion.

For many parents, the child tax credit, which expired this month, went toward covering childcare costs. Without it, parents are once again forced to reevaluate their spending to see if they can afford childcare.

“Without the monthly money from the child tax credit, there would be no way we could afford my son’s day-care bill,” Pasha Benjamin, mother of a toddler, wrote in a Fortune op-ed. “I’m dreading the day when my son’s day care begins to eat up too much of our budget. I’ll have no choice but to leave my job to take care of him full-time.”

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