WASHINGTON, DC – On April 14, U.S. President Joe Biden addressed the nation from the Treaty Room at the White House regarding the withdrawal of American troops from Afghanistan. In his speech, he also unveiled a significant $39 billion initiative dubbed the American Rescue Plan, aimed at revitalizing the child care industry severely impacted by the COVID-19 pandemic. The funds are intended to assist states, territories, and tribal communities in combating the child care crisis, which has had a profound effect on working families, particularly women.
The pandemic has taken a toll on nearly every sector, but data indicates that working women, especially those without college degrees, have faced unprecedented challenges. Many parents find themselves with limited options if their preferred child care is unavailable; in such cases, the mantra is clear: no childcare, no work.
The Biden administration asserts that this funding is crucial for economic recovery and fostering a more equitable future for women, who have historically contributed significantly to the workforce. However, the pandemic has driven about 2 million women out of the labor market, predominantly due to caregiving responsibilities. This trend threatens to reverse years of progress in workforce participation rates among women, particularly affecting families of color who often rely on mothers as primary earners.
The White House highlighted that child care providers, predominantly small businesses and often women-owned, have also been acutely affected by the pandemic. With enrollment declining and operating costs rising—up to 47 percent higher according to some estimates—these providers are struggling to maintain essential services. Reports indicate that about one in four child care facilities were forced to close during the early pandemic, exacerbating existing disparities in access to care, especially in communities of color.
The $39 billion earmarked by the White House includes $24 billion for stabilizing child care services, ensuring providers can reopen safely, retain staff, and offer mental health support for both educators and children. The remaining $15 billion is designated for flexible funding to make child care more affordable and accessible for families, improve pay for workers, and address various state-specific needs.
For more insights on this pressing issue, check out our other post here.