(upbeat music) - Childcare is one of the business sectors the pandemic has hit especially hard.

And when it's in crisis, the effects ripple through the economy, it supports working families and helps ensure employers have an available and talented workforce.

It also provides necessary early childhood development.

We discuss accessibility, affordability, and how to stabilize the pandemic induced childcare crisis on West Michigan Week.

Thank you for joining us on West Michigan Week, the unemployment rate is low and that's a good thing.

And yet there's a worker shortage.

One reason for this is a lack of childcare.

The pandemic and the virus spread closed a number of childcare centers with many closing and workers in the field have moved on to other careers.

For families unable to find childcare, they're staying home with the kids.

For businesses, that's limiting the pool of potential job seekers.

Here to discuss this dilemma and potential solutions are Jessica White, director of operations at Big Steps Little Feet Christian Childcare and Preschool, and Nate Henschel, director of government affairs with the Grand Rapids Chamber.

Jessica, you've been in this for quite some time.

And I think we've all had kids in childcare on this call.

So pre pandemic, what did the landscape look like?

How has it changed and where are we now?

- Pre pandemic we still washed hands.

We still taught personal hygiene and space, but not to the degree and the impact as we have seen in the last two years.

It's been pretty amazing to measure what was going on beforehand, which was more focused on fun and learning and the opportunities at hand that just pop up in the moment that cultivate learning for young children, that is a huge shift away from that to more, are you well, how do you feel?

Do you have a temperature?

Is that a new cough?

Is that accompanied with another symptom?

Can we talk to mom?

Do you have your mask?

It's all of those pieces that don't allow for those more spur of the moment learning opportunities, which unfortunately take some of that joy away from the job.

- How many children are in your care?

- We currently have an enrollment of 175.

Some of those children are full-time and some are part-time and some of them are siblings.

So we get to serve more than one child from the same family.

- How's your staffing level right now?

- I can genuinely say that we have been all right.

We have not had to close any classrooms, which I'm grateful for.

We have really dedicated loyal staff who are awesome individuals that show up everyday for the children and that matters deeply.

So we've had our moments by all means where it has been close, but proper ratio is a non-negotiable.

And thankfully we have been able to maintain that on a daily basis.

- Because you're state regulated like other childcare facilities, have you had turnover with your staff over time since the pandemic?

- Yes.

Yes we have.

Some of it happened pretty quickly where people realized how serious this could impact their family and said I can't work here, this is a too high of a risk of an environment and I'm done.

And then we had individuals who said I can't, but I want to come back later down the road when it's more safe and turnover has definitely been an ongoing concern.

- Can you share any conversations with parents?

I know there's a lot of interaction with parents every single day, right?

You get to know the parents, you get to know their situations, what has happened with them in some of the conversations that you've had over the last two years of this pandemic, what's happening with families?

- They're pretty stressed.

We've had a lot of families express thankfulness that they didn't realize the impact of us being open beforehand and the impact that would have on their work.

But we've also had family ask questions, tell me again, you know, what are you doing?

I know you sent it in an email, but I didn't have time to read it.

So can you just give me the low down?

And we say it as many times as we need to to build that trust with the parents, but it's a lot of stress.

It's a lot of, well, I'm a close contact, so now what do I do with my child?

Can I bring them or not?

And it's the same kind of concerns that they're not necessarily able to do their regular job in the day because they're swamped with these other focus points that are certainly important, certainly we're talking about, but take away from, again, those calm peace moments of being present for your children in a way that was not available yesterday and for the last 18 to 24 months.

- And Nate, you're somebody who also uses childcare.

My kids have moved on from that age group, but I know you're there right now.

So you're also seeing this.

You're also walking through those doorways and seeing it, but from the business perspective, you're really seeing how childcare is the backbone of the economy and for businesses locally and nationally.

- Oh, certainly.

And it's a bit ironic that I sit in this seat now to help try and solve this issue for our members because I lived it at the exact moment the pandemic hit, we found out my wife was pregnant at the end of 2019 and went into the pandemic year trying to sift through not only what was before the pandemic a very tough climate to find childcare, but then during a pandemic, this is, as you said, childcare is the pillar of our economy.

Without childcare, we do not have a workforce.

And so you're seeing, that's why this is a top issue for our members.

It is a workforce development issue and it's also important too, it's not just the workforce side of it, but it's also, we want quality childcare for our kids.

We want a strong workforce.

We want strong, good, safe childcare moving forward.

And our members are clamoring to help their employees to navigate this.

And it's becoming not just an issue that their employers are facing, but it's becoming a talent attraction and retention tool.

Just as much as 401k's, retirement plans, health care benefits, are the benefits people are looking for.

Add in childcare and businesses are realizing that and companies and job providers all over just how important that is.

- How short are we of facilities?

I don't know where that data lies.

I don't know, Nate if you've quantified this or Jessica, if you can quantify it, there is definitely a shortage.

We need more care.

- Yeah.

I saw a recent study that I was looking through that said the Michigan League for Public Policy and Kids Count released a study showing the childcare woes that we're facing here in Michigan, 44% of kids in Michigan live in childcare deserts.

Those are areas where the ratio of kids under five to licensed childcare provider is greater than three kids per childcare spot.

Statewide that ratio is 1.9 kids per childcare spot.

And here in Kent County, specifically, we're 1.7 kids per child care spot.

So it's clear that there's a major shortage and it's exactly why we're tackling this issue.

- We can look at policy in a minute, but Jessica, what are you doing?

What are other childcare providers doing to try to attract talent just in childcare itself?

I mean, we're seeing wages going up, but I know that there are structural issues within childcare, it's not cheap.

I mean, we've been there.

So what is it, how do you attract, how do you retain that talent just within childcare itself?

- There is not a large profit margin in childcare, especially if you provide care for infants and toddlers as the majority of who you serve, because the ratio for child to adult is quite low.

And when you look at what can we do then to retain talent, to promote the industry, to elevate the profession, we have to look outside of that.

Yes, we have increased wages and are grateful for the opportunity to do that.

But we also consider shortening our hours.

There's the quality of life piece that has to be considered for the childcare employee as well.

And we don't all of a sudden walk out of the building just because there's no children here anymore for the day.

There's tons of cleaning that needs to be done at the end of the day, reorganizing of the room, thinking ahead and planning ahead for the next day.

So the shift extends beyond just the time that children are here and so shortening the hours so that they have some more time with their own families is something that we've done, offering free training, offering the opportunity to increase their education through a CDA if they don't have it or a bachelor's degree, those are all supports that you have to consider.

Even simple things like providing great snacks and great drinks in the staff fridge and that refreshment moment that's needed throughout the day.

Those are all elements that speak to the mental health of your staff, the quality of the relationships with your employees.

And then if you feed into them, they can then feed more into the children that they provide care to every day, which really is the bottom line.

- I would exit poll some of the staff back when my girls were going through childcare.

And I'm like, where is the cost?

And I never had this confirmed, but staff would tell me it's insurance.

And it's typically in the meals, like that's where a lot of the money goes.

You're saying yes, is that pretty much the majority of the cost and where the expenditures go?

- And wages, and then also supplies.

So if you provide meals within your center or within your home to children, you provide supplies that accompany all of that, all within the licensing rules, which are reasonable and doable and absolutely needed, and give really good guidance on how to operate, but there are costs associated to all those things.

And if you want to, again, think about how can you make this job truly a career, then you also provide tools for your staff to be able to teach and nurture the children well, and that means new toys, that means different equipment.

That doesn't necessarily have to take up the majority of your budget, but it should be a significant line item.

- And you want that career growth element also for your staff?

- Yes, absolutely.

We want this to be a long-term thing.

It matters deeply what happens within the first five years of a child's life, and the majority of that time, if they come from a home where there's two working parents is spent within a childcare environment.

- Nate, I know you've been talking with business leaders.

So on the other end of the spectrum, they're desperate for workforce.

And we have families who are staying home for a number of reasons.

It can be because their children are under the age of five, they're unvaccinated, they're not certain if childcare is what they want.

So they're staying home.

Other simply have to go into work.

They don't have that virtual flexibility.

So what's the business community communicating to you?

What's happening?

And then we'll get into the solutions here, because I know you're working with leadership in Lansing, and also you have a pilot program that I think we're about a year into now that may be showing some results.

So what are you hearing from the business community first?

- What we're hearing are all options are on the table.

And it really depends on even employer specific.

Some are looking at developing their own centers on site.

Some are looking at, as we'll discuss in a minute, the program and pilot program Tri-Share, which is a cost sharing program.

Some are asking their employees, what do they want?

Are they gonna include some benefit?

Like we said earlier, similar to a 401k payment to families as a childcare benefit that they could then go and use and get childcare wherever they choose.

The conversations around that is then what happens to employees without children, right?

Is it similar to not taking health insurance in receiving that payment as paid out rather than using it for childcare.

But all options are on the table.

And we are fortunate to have many great employers at the table looking at all the options, because like I said earlier, it is a talent recruitment and retention piece of the puzzle to this workforce.

- It's a hefty expense for parents too, working parents, it is expensive and it does seem to fit into that benefit piece.

But it also seems as though everybody has a hand in this.

And so would you consider it some kind of a social program if we got into this or how would you best describe getting through this so that it works for everyone involved?

- And I think that's part of the problem.

It's not a one size fits all approach, especially as you look at regionally throughout the state, Kent County in West Michigan, our struggles with childcare can be very different than say in Northern Michigan or rural parts of the state where transportation's a barrier.

Even in large cities with bus systems, it's hard to take a childcare seat on a bus.

I mean, it's finding a solution that isn't necessarily just one silver bullet.

I think there's many different fixes and options.

And you'll see, I believe employers moving to the systems that work best for them.

But then we also need to find a way to catch folks who maybe don't have an employer who provides any sort of benefit.

So I think it's a multi-pronged approach, certainly.

And there's no one single answer if you will, that's why we need to be creative in the way we think about this and who we're looking at in where they live.

- So what are some of the getting creative?

And you're saying that there are different possibilities here.

One is you go to Lansing.

What are some of the policies that, I believe the house, there's some house bills and they're moving on to the Senate now, what has been proposed in Lansing to help facilitate correcting this childcare?

- Yeah, well, we are really fortunate, the Grand Rapids Chamber and a large coalition of business leaders and elected officials, they came together to create really a first in the country style pilot called Tri-Share.

Tri-Share is a childcare pilot program.

And it's innovative because it's a public and private partnership that equally shares the cost of childcare between employers and employees in the state of Michigan, equally divided up into thirds.

This was launched in March of '21 with $1.1 million of funding, West Michigan representative, Greg VanWoerkom championed that legislation.

And we're extremely grateful to his work on that front and the entire legislature and the governor for making this happen.

Currently, there are three pilot regions that serve as the facilitator hubs between employers, employees, and then the state.

Families get to choose their childcare location.

The facilitators are there to help with payments, sort of the accounting, the backend.

And currently they're at 23 employers right now that are taking advantage of this program.

just even in September.

So just a few short months after we got a $2.5 million appropriation into Tri-Share, and we were able to extend the grant deadline to the end of this year.

So December 2022.

Since this is a pilot, we will then look back and say next year, what were the successes, what were the failures?

And then hope to launch this in a scalable statewide format someplace down the road.

But this is step one, getting the pilot and seeing what we can learn, cause there will be lessons learned.

And then hopefully rolling that out to the state.

- Jessica, when you heard about this program, what was your first reaction?

- Excitement.

I think it's so smart.

And I think it brings along providers who may not have an opportunity to tap into something like this had it not been orchestrated in such a well thought out, planned, intentional, purposeful way.

- It's having that skin in the game too.

You've got the state involved business and working families.

- Yes.

It was very intentional from the Chamber's perspective and working with the leaders in our community to make it happen and opening it very broadly.

It wasn't just for particular providers, the whole state had the opportunity.

And so it was really nice to see providers who may not be interested in participating, but still included in the conversation.

Still thoughts gathered, perspective gathered on how this could work.

And the chamber did a really great job with getting perspectives of current providers, current businesses, local leaders, to make this roll out in a well thought out purposeful way.

I think it's great.

- Nate, what has been some of the initial reaction?

I know you're still gathering information, but just initially, and in particular, from some of those 23 businesses who have invested in this, what has been their reaction so far?

- Well initially it was how do I sign up?

When people heard about this and employers, they wanted in.

And I think that's when you saw in mid September, another infusion into Tri-Share and moving forward where we do not currently have a site in Kent County, but I think we are getting close.

I had an update call last week, both with the governor's office and the women's commission who houses Tri-Share as the pilot to get an update and signs are promising thus far, it is a very creative solution, but there's also administrative pieces to figure out using the hubs.

But we're excited about it moving forward and certainly want to see this as the standard, as something that can be rolled out statewide, but hopefully we'll get one in Kent County.

Again, that is sort of one of my big tasks for the next quarter here to try and get that here so we can really show people how it works.

And childcare is expensive, right?

Trust me, I know, but we want good quality care.

And this is a good piece to solve that cost puzzle, dividing it up equally of thirds because we don't want the level of care to go down.

We want to help keep it rising and get the great centers like Jessica's that I know from personal experience, my daughter is a sponge right now.

She's learning.

This isn't I just drop her off and she colors and it's fine.

She comes home and she starts pointing at the wall and counting things.

They are teaching her, as much as I would love to be doing that during the day, they are doing that.

And they're helping her development, which is critical up until as we know, that five-year mark where this is the important time to catch the kids now.

And so we want quality care.

So this is a huge, huge resource to help keep quality care, but also lower cost for families and increase access.

- Well it also piggybacks off of the state's commitment to early childhood development.

I would imagine that's a great selling point with the Tri-Share program, right?

Because the state has made this commitment.

- Absolutely.

But they are, and it's showing that, again, you said it earlier, the skin in the game and credit to the governor and the state legislature for again, and at the end of last year, they passed another historic $1.4 billion infusion into childcare.

And that went into direct payments to workers' bonuses, but it also raised the eligibility of those that qualify for state assistance for childcare.

Again those changes are temporary for the next several years.

And there's a decreased set, but we would like to see that stay the same or maybe increase moving forward.

So we're catching and providing a safety net for those who, again, may not have an employer who can participate in Tri-Share or who doesn't.

So again, sort of looking at all options, but yeah the investment from Lansing and the governor, Greg VanWoerkom, representative, and the entire state legislature was huge in this.

And I think we'll see, hopefully in a year's time at this point again, recapping Tri-Share, and looking at the successes and hopefully looking to roll it out.

- How does the Tri-Share program help with the people problem?

And that is getting the staffing levels that we need, and even creating more centers to kind of alleviate that two to one gap that we're seeing.

- Well definitely increased demand, right?

And that's one thing we need to look at moving forward is how do we then, you know, Jessica and I talked about this several times of how we need to encourage folks to go into early childhood development and catch them in high schools and career readiness.

It's a whole nother piece of the workforce issue that we need to find solutions for moving forward.

So what has been done is great.

Tri-Share is a piece to the puzzle.

I did a listening session last week with some folks around the state and we asked folks when they logged on what were they there to talk about as it related to childcare.

And it was always either access or cost.

And this is one piece of the cost puzzle.

We now need to then begin to look at the access, and not just access from cost barrier, but from provider standpoint.

So those are things that we'll certainly be looking at moving forward.

There are a couple of regulatory type bills in the state Senate right now, they passed the state house, and they provide fixes and changes, creating some networks for in-home childcare providers, some programs within Department of Education, trying to then take a bite of the apple of the supply side of the problem if you will.

- Jessica, what advice do you have for helping to stabilize this issue?

- Continue to focus on the industry as a whole, continue with things like the stabilization grant that really promotes the industry, it recognizes it as significant, needed, continue to talk to providers, help parents reach providers, even just to talk through what do I do next If I can't enter your center.

Keep the conversation going because ideas spark from that.

Motivation sparks from that support and collaboration sparks from all of those things.

And it's exciting to be part of it and to think about solutions to this situation.

- Has the pandemic been a wake up call?

Because it seems as though childcare was an issue before the pandemic and it has really become an issue now that we're in a pandemic.

- Yes, I would say it has been, absolutely.

It is harder to go through something like this, absolutely.

All the way around, it is not fun.

And it's been pretty deep and dark in some days, but that isn't where we stay.

And for the sake of our next generation, for the sake of the health of our communities, we can't stay there and we can't stay here in this moment either.

If we're going to nurture children to think of ways so that we can get out of this going forward should it ever happen again, we need quality providers.

We need the people who care deeply about our future generations in those five years where it matters so much what they learn, who they're with and how much time they're spending there.

- It's a good way to end this.

I want to thank both of you for being here.

Jessica White, Big Steps Little Feet, Nate Henschel with the GR Chamber.

Thank you both so much for joining us.

And I'm hoping maybe this brings people in behind the scenes of what's taking place in childcare.

Thank you both so much.

I appreciate it.

- Thank you.

- Thank you.

- And thank you for joining us.

We'll see you again soon.

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