Child care is a question thousands of parents across Idaho must answer. Prices for child care have increased since 2020 and instability in the child care sector has resulted in thousands of Idahoans going part time or leaving the workforce to fill the gap.
While not the sole contributing factor, the cost of child care remains a major barrier for a significant portion of Idaho’s potential labor force.
Idaho is still experiencing historic labor market tightness despite recent softening. From January to December 2024, the unemployment rate in Idaho increased from 3.3% to 3.8% while the U.S. rate increased from 3.7% to 4.1%.
When unemployment rates are this low it means workers are in short supply. This can create an unfavorable climate for businesses since they must compete by raising wages at the cost of profits. Learning about the child care cost barrier can help employers struggling to find and keep workers.
Workforce participation
In 1870, when Idaho was still just a territory, there were about 2,000 women in the state out of a total population of 13,000. As a mining state first, there were 7,273 people in the industry — only two of whom were women — out of 10,879 total employed.
In the 1940s and 1950s, the winds began to change with more women participating in the state’s workforce. By the end of the decade, the percentage of women in the workforce jumped from 16% to 24% [4]. This trend would continue well into the 2000s, peaking at 59% and remaining stable thereafter [1][3].
The entrance of women into the workforce also meant new solutions to child care had to be created. One of these solutions — day care — is becoming less popular today due to rising prices.
The increasing cost of child care has accelerated woes for working families. Back in 2012, child care for all ages was available at a median cost of around $100 a week or just over 7% of a family’s income.
From 2015 to 2022, the labor cost of the industry began to rapidly increase as unemployment dipped below 4% and day cares increased prices to cover the cost of employment. This resulted in a 2022 median weekly cost of $166 for full time infant care at the highest and $135 for school age children at the lowest.
As a percentage of family income, the U.S. Department of Health and Human Services considers 7% to be the benchmark for affordable child care [6]. As wages have not kept up with the cost of child care, prices have surpassed 7% for all age groups since 2019, as seen in Figure 1 below [9].
Figure 1: Income and cost of child care
Source: National Database of Childcare Prices
As affordability has decreased, the day care industry has begun to feel the impact of people looking for alternative child care situations, especially when both parents work. In 2023, 63% of married couples in the U.S. with children under 6 years old were both employed. For families with the mother as the head of household, 70.4% of them were employed [2].
The lack of affordable child care access disproportionately affects mothers, most of whom work, either from the direct cost of child care or forgone wages. The establishment of a stable and affordable child care system could be the key to helping parents who want to remain in the workforce and for employers looking to fill their job openings.
In 2022, day cares were the third most popular child care arrangement after relative non-parent caregivers and “no arrangement” — meaning a parent stayed home to take care of the child or the child was old enough to care of themselves after school [8]. “No arrangement” was the most popular option at 55% of Idahoans, followed by 26% receiving care from relatives and 12% using a day care center. For younger children under 4 who typically require more care, 40% of parents used care from a relative, 30% had no arrangement and 20% used a day care [5].
Child care provider struggles
The child care industry in Idaho has had its share of post-COVID-19 pandemic struggles. A net of 32 day care centers were lost at the beginning of the pandemic, concluding the period of industry growth. Day cares saw a brief restoration period that ended again by the third quarter of 2023 after the early termination of federal COVID-19 grants. The final quarter of 2023 saw a brief recovery followed by a downward spiral by the end of 2024 with the net elimination of 45 day cares statewide.
There was a net loss of day cares in every region of Idaho, but it was primarily driven by losses in southwestern Idaho, the region with the most day cares. Southeastern Idaho lost 16% of its day care centers during this period — the highest percentage among all the regions.
In late 2023, day care employment levels flattened out to around 4,500 employees statewide, but this was reduced to 4,200 by year’s end. Regionally, 201 of those employees were lost in southwest Idaho. Generally, across regions, 2023 initiated a shedding of employment while 2024 deepened the trend in line with what is expected from day care closures.
The end of the federal COVID-19 grants also caused declines in day care employment in 2023. Figures 2 and 3 below paint a picture of day care centers struggling to pay their workers without the grants, leading to a reduction in workforce. Since it is required by law that there must be a certain number of caregivers for a given number of children, fewer caregivers available would then reduce the number of children allowed to be enrolled.
Figure 2: Number of day care centers in Idaho
Source: Idaho Department of Labor (IDOL)
Figure 3: Number of day care centers in Idaho by region
Source: IDOL
Child care access troubles
In the U.S., the number of individuals who reported part-time work due to child care issues increased from 1.1 million in January 2021 to 1.3 million in January 2025, according to census estimates [7].
Figure 4: U.S. part-time work due to child care issues
Source: Integrated Public Use Microdata Series (IPUMS)
In Idaho, there was a more unique trend. The number of people reporting part-time work schedules due to problems with child care hit its peak in January 2024 with an estimated 20,000 Idahoans — 17,000 of whom were women.
While part-time numbers for women in Idaho reached the thousands, incomplete data for men showed a peak of 3,500 reporting part time in February 2023.
The end of the COVID-19 grants also caused a large spike in part-time work in August 2023, as shown in Figure 5. [7]. This trend also coincided with the employment trend observed in the third quarter data in Figure 2 above.
As mentioned before, the loss of COVID-19 grant money and the limit to how many children could be enrolled at a single day care caused a supply shock— in order for day cares to stay open, prices had to increase.
Figure 5: Idaho part-time work due to child care issues by sex
Source: IPUMS
Tracking the number of day cares open with the number of people reporting part-time work due to child care issues, there were 28 closures in the second and third quarter of 2023.
As day cares began to readjust in the last quarter of 2023 with many reopening, something interesting happened — day cares started closing through most of 2024 but there was no associated increase in part timers.
While the loss of grant money in 2023 could be called a supply shock, 2024 could be considered a demand shock as adjustments to the loss of federal funding meant higher prices being shouldered by parents in Idaho. This could have caused many parents to be priced out and led to them seeking alternative arrangements such as care from a relative or leaving the workforce altogether.
There was a net closure of 48 day care centers statewide in 2024 [7]. Once data for 2023 and 2024 child care prices become available, further light will be shed on the issue of child care price increases in Idaho.
Figure 6: Idaho part time work due to child care vs change in number of day cares
Source: IDOL, IPUMS
Brandon.Duong@labor.idaho.gov, regional economist
Idaho Department of Labor
208-236-6715
Sources:
Bureau of Labor Statistics Employment Characteristics of Families 2024 [2]
Decennial Census [4]
Household Pulse Survey Data [5]
Integrated Public Use Microdata Series [7]
Most Parents Don’t Have Any Formal Child Care Arrangements [8]
National Database of Childcare Prices [9]
This Idaho Department of Labor project is funded by the U.S. Department of Labor for SFY25 as part of a Workforce Information grant (40%) and state/nonfederal funds (60%) totaling $885,703.
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