What's Happening?
A new report titled 'Growing with Care: Child Care and Economic Opportunity in Lancaster County,' produced by First Five Nebraska, indicates that inadequate child care is costing Lancaster County $288.8 million in lost business output annually. The report estimates
these challenges contribute to 1,115 fewer jobs, $264.2 million in lost labor income, and $10.44 million in lost state income tax revenue. For families, the average annual cost of care for one child is $15,392, rising to nearly $28,000 for families with more than one child. Cost is the most frequently cited barrier, with nearly one-third of parents experiencing difficulty finding care. Families earning under $100,000 annually are three times more likely to report significant difficulty. The number of licensed child care programs has declined by nearly 26% since 2019, from 442 to 329 in 2026, largely due to a 35.2% decrease in home-based providers. Despite this, total licensed capacity has remained stable, but the county still needs capacity for an additional 736 children.
Why It's Important?
The report highlights the significant economic and social costs of inadequate child care in Lancaster County. The substantial financial losses in business output, jobs, and tax revenue underscore that child care is not merely a family issue but a critical component of the regional economy. When parents struggle to find affordable and accessible care, it limits their workforce participation, reduces productivity, and can lead to increased financial strain on households. The decline in home-based providers, often a more affordable option, disproportionately affects lower-income families. Addressing these child care challenges is crucial for supporting the local workforce, fostering economic growth, and ensuring that families can thrive. The findings provide a data-driven basis for local leaders to prioritize investments and policy decisions aimed at strengthening the child care system.
What's Next?
Local leaders in Lancaster County are expected to use the report's findings to guide future investments, partnerships, and policy decisions. The City of Lincoln has already allocated over $2 million in local and federal funding towards early childhood care, education, and workforce initiatives. Lincoln Littles has invested more than $5.1 million since 2019 to improve access to quality child care, and Lancaster County's Childcare Grant Program offers financial assistance to families and supports facility improvements. Continued investment and cooperation are deemed necessary to address the persistent challenges of affordability, access, and quality. The goal is to strengthen the child care system to better support Lancaster County's workforce and economic well-being.
Beyond the Headlines
The report's detailed economic impact figures reveal the hidden costs of a struggling child care sector, often overlooked in broader economic analyses. The decline in home-based child care providers points to a systemic issue where smaller, often more flexible and affordable options are becoming unsustainable, potentially due to rising operating costs, staffing challenges, and regulatory burdens. This trend could further concentrate child care options in larger centers, which may not always meet the diverse needs of families, especially those with non-traditional work schedules. The disparity in access for families earning under $100,000 highlights a growing equity gap, where quality child care is increasingly becoming a luxury. This situation could perpetuate cycles of poverty and limit social mobility, underscoring the need for comprehensive policy solutions that consider the varied economic realities of families and providers.
