In a classroom at Creative Schools in Morrisville, 3 and 4-year-olds roll out Play-Doh, then smash it flat and use cookie cutters to make shapes. The well-lit room has all the distinctive elements of a pre-K class. Letters and numbers in bright colors hang around the wall, and kids sit in chairs too small for adults.
Kimberly Covington directs this school and has been in the child care industry for almost a quarter century.
"I started out as a teacher and worked my way all the way up," Covington says. "So I know the business from the ground up."
When the pandemic first hit, some child care facilities stayed open to care for the kids of essential workers. With unemployment high and enrollment down, there were enough teachers to staff these facilities. As the economy picked up, Covington says staffing levels struggled to keep pace with the bounce-back in enrollment.
"Some days it's a guessing game, especially if you have staff that quit," she says. "Because it's easy to get burned out. You know, we're short-staffed so teachers have to work longer hours, [and] they get burned out really quick."
Federal pandemic relief funds distributed more than $2 billion to 4,400 child care facilities across North Carolina. Schools used some of that money to pay teachers more, which helped to keep staff in schools. But that funding is going away at the end of this year, and if it's not backfilled in some way, Covington says it's going to hurt staff retention.
"If there's not a plan in place at schools and they have to reduce teacher salaries, it's going to be a major hit to the field," she says.
Commerce experts say failing child care centers would hurt the state's economy. Debra Derr, the North Carolina Chamber director for government affairs, says good child care is vital to support a good workforce.
"This is not a women's issue, and I bristle when I hear people say that," she says. "This is a family issue. It becomes a workforce issue; it becomes an economic development issue."
North Carolina's 3.4% unemployment rate has stayed low even as the Federal Reserve raises interest rates. As child care becomes inaccessible for many, it drives even more young workers out of the labor market. Derr says that makes finding workers even harder.
"It doesn't matter where you sit," she says. "If you sit at the bus stop or if you sit in the C-suite. The problem impacts people in every ZIP code, in every tax bracket and every political party."
Findings from a recent Chamber survey back that up. Four out of five registered voters said child care is important to strengthen the economy.
"And I would say people are looking for action, too," said Meredith Archie, president of the N.C. Chamber Foundation which conducted the survey. "And that was something that was really interesting to see from the survey, was that 80% agree that North Carolina should invest in solutions."
At the legislature, that's exactly what some advocates have been calling for. The President of Child Care Services Association Kristi Snuggs is calling on state lawmakers to make up $300 million for federal stabilization grants that are going away.
"That's a lot of money. But in the big scheme of things it's not," says Snuggs. "And we know that there are reserves in North Carolina."
Snuggs has identified one easy way to find that money. There's a plan to lower state income taxes to below 4% by 2027. The Republican-led Senate budget proposal would put that lower rate in place by next year.
"And by accelerating that, they're wiping out all of the funds that they could use to invest in child care," she says.
Earlier this year, the state did increase reimbursement rates for facilities that serve low-income families. Advocates say that helps, but they consider it more of a routine increase, not funding to backfill pandemic-era stimulus.
Additionally, the Senate budget proposal allows for some unused pandemic relief money to be diverted to child care facilities. But budget analysts say that would cover only about one-third of what advocates are asking for. And the House budget doesn’t include any help.
