US parents face a 50% surge in childcare costs

U.S. childcare costs have surged by as much as 50% in the past year, becoming one of the biggest sources of stress in parents' lives, according to a new survey.

Some 90% of parents lost sleep over care-giving stress, while 80% reported crying, the survey by Care.com found. The stress has also been linked to health issues, and almost a third said they've considered suicide or self-harm, the report said.

A decline in federal aid and a shortage of workers has left the childcare industry on the brink, with more than half of providers aware of at least one program recently shutting down in their communities. During the election, President Donald Trump's campaign said he prioritized expanded access to child care and paid family leave during his first presidency, though details on how it will be tackled in this administration are yet to be seen.

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Family-care centers now charge $344 per week for one infant, up 50% year-over-year, online care-giving platform Care.com said. These facilities — daycares within a provider's home — have traditionally been a more affordable option than a daycare center, but now prices are nearly identical.

The cost for a nanny for an infant is now about $43,000 annually, 8% higher than a year earlier, while for a toddler it jumped about 14% for a roughly $44,600 annual price tag. Daycare center costs also rose between 7% and 8% on the year.

"Unfortunately the trends have worsened, particularly with family-care centers," said Care.com CEO Brad Wilson in an interview. "You're really in an environment where a lot of centers have shut down. In addition, you've had the pool of caregivers decrease and federal funding dried up."

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Child-care prices, which in many cases outpace housing costs, are increasingly squeezing American parents. The end of $24 billion in Covid-era aid in late 2023 was yet another blow to the industry that had already faced an exodus of workers during the pandemic, and been plagued by decades of underfunding.

Nearly half of the providers surveyed by the National Association for the Education of Young Children in January 2024 said they'd increased tuition, blaming staff shortages and higher costs for necessities like rent and insurance. Many operators face stiff competition for workers from other industries like retail or fast food that pay better.

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The financial reality is forcing some families to make tough choices, including causing one parent — typically the mom — to drop out of the workforce. Care.com, which surveyed 3,000 adults in November, also found that a third of parents are dipping into their savings to cover costs.

"Everybody knows how broken it is," Wilson said of the childcare industry. "It's going to be unsustainable."