We have a great panel assembled to talk about child care, workforce issues.

And joining us in our Lexington studios are Mike Hammonds, vice president of Advocacy and Learning Grove and Northern Kentucky.

Sarah Vanover policy and research director at the Kentucky Youth Advocates.

And Kate Shanks, senior vice president of public affairs with the Kentucky Chamber.

Good to have you all.

Thank you for being here.

Ms.. Kate Shanks with the Kentucky Chamber.

You all are focused, laser focused on workforce issues and child care issues and the emergence, the nexus of those two.

What role does the child care industry in the workforce play in Kentucky's overall economy?

How important is it?

That's a great question.

It's extremely important, and I like to think of it as two sides of an equation.

So the chamber does work on creating jobs, and we've seen some significant job growth in Kentucky over the past few years.

We have worked hard advocating on policies that really put Kentucky on the map to create those jobs.

But the other side of the equation is we have to have the workers to fill them.

And that's where we focus just as much time from a policy and programmatic side.

Otherwise, we're not going to see the economic growth or our economic potential that we hope to see.

And so I tell people, when when you see the Chamber of Commerce working on an issue, do you think why is the business community interested in that?

Chances are it's because we are dealing with one of the drivers of our low workforce participation.

We sit among the bottom ten of states in terms of our workforce participation, which is just simply the percentage of people over the age of 16 that are working or are not working, but looking for work and are technically in our workforce.

We have been among the bottom ten of states for years.

This has been a very, very stubborn problem for us to fix.

And when we started kind of peeling back the layers of this problem and trying to better understand it, there's there's so many drivers for it.

We work on substance use disorder, work on skills development, we work on health issues.

Are people too sick in certain instances to work?

And then, of course, child care.

Child care is absolutely a barrier for some to work.

And it could be, do I even have child care facilities or, you know, providers in my community?

Can I afford it?

Do I have providers that serve when I'm working?

Maybe I'm working a third shift.

What kind of what kind of challenges do I face as somebody who wants to work but can't because of childcare?

And so we recognize that this was a problem.

I mean, it's certainly not a new challenge.

When I when I had children who were in the child care age, it's been a while.

The 15 year old, 11 year old, I remember when, you know, you had to go get on the list to get your name on the list.

And sometimes you did that before you told people you were having a child.

Right.

Right.

And it was absolutely a second mortgage payment back then.

Well, since my children have aged out of child care, we're down 17, 1800 child care facilities in Kentucky.

So the problems that I faced have gotten even more difficult for people.

I think it's fair to say.

So we come at this problem from from multiple angles.

I mean, we talk about the workforce challenges in every sector of our economy is struggling with workforce challenges.

And of course, the childcare sector is as well.

And I think that they have some unique challenges.

And, you know, Dr. Vanover mentioned the issues with with wages and that you can go work in so many other jobs and make more money.

And I think some sectors have found ways that, you know, wages have gone up, but let's automate, let's increase efficiencies.

Well, how do you do that in a child care center?

How do you automate?

You know, you can't.

So they have some unique challenges there.

We also look at it from the standpoint of affordability and as well as making sure that there aren't barriers in place and that there are incentives to create new childcare facilities where they are needed and really to to ensure there's different types of child care providers in different communities.

This is not just a golden triangle problem.

This is something that we look at from a statewide standpoint.

And we know rural parts of the state, especially Kansas, can struggle with the childcare deserts.

So we're coming at it from all different angles.

That is a driver of our work flow workforce participation.

It is a barrier for some to work.

And so it's certainly something that we've been focusing on.

So Dr. Vanover, you once worked for the state and you were the director of Kentucky's Division of Child Care, and there you spearheaded what's been called an out of the box solution to help with the child care worker shortage.

Tell us about that and how it's going.

Well, it's going very well when we receive the American Rescue Plan money.

We were looking for innovative ideas that could prevent Kentucky's child care structure from collapsing.

And every state is looking for that right now.

But so many of us, we've done the same thing for for so long.

And that idea has been always to help parents pay the cost and to try and pay child care providers more.

But those wages haven't seem to be going up.

The problem is we were paying child care providers more with the AARP money, but everybody else started to pay more, too.

And all of a sudden retail went from starting at $11 to starting at $17 an hour in child care programs do not have the capital to make that kind of investment.

People were leaving child care to go work at Target or Starbucks or other businesses where they could start off at 15 or $16 an hour.

But then they had to pay for their own children to be in child care.

Mm hmm.

And knowing that the cost is astronomical for one child, it can be around anywhere $11,000 a year.

Rivals community college tuition.

Yeah, right.

Community college tuition for an infant.

Average toddler care throughout the state is about 8000 a year.

So when you think about that cost, is that enough for the gap between the two?

Also, a lot of people that work in child care, they they want to be around children.

That's always been a goal.

They want to be around their own children when they're little.

When I was a director, my children were very little and they were down the hallway from me and I could go to class parties and that could go on the pumpkin patch field trips with them.

And it was a perk of being there in the building.

So if you can take somebody who wants to work with children, who's skilled and trying to do it and say, okay, so the wages are fantastic, but what if you didn't have to pay child care?

What if we waived that cost regardless of your overall household income?

Most child care providers, maybe not most.

A good chunk of our child care providers qualify through the subsidy program at low income that may be their partner or their spouse, and the house would tip them over the scale or if they work at one of the programs that has increased wages and they've hit that cliff where they lose their benefits, but they're still not making enough to be really productive.

So we're taking that out of the factor.

We're excluding income completely from the equation and saying if you work 20 hours a week in a child care program, you will get a subsidy for your child and then you can actually take home your wage and and benefit from that.

Now it that program has more benefits than just for the parents.

The parent of the child who's working in the child care program can come back to the center.

And that's fabulous that they don't have to pay child care.

But prior to that, a lot of centers were subsidizing their employees on their own.

Maybe they would give them a 50% discount.

But if you're a child care provider who is desperately trying to pay their bills every month, waiving 50% tuition for multiple people is going to affect your bottom line.

So if the state took that over and they could get their full income and be more financially stable and they're bringing more people into their center, it's a huge boost for the child care programs themselves.

The other is to think on the return on investment for the state of this program, ratios in child care ranged from one adult to five infants in an infant classroom all the way up to one adult, 214 four year olds in a classroom.

So let's say for every adult and a child care program, we get an average of eight other children in the community that they're caring for.

If you're looking to increase your workforce like the Chamber was talking about and you say, I can get this adult to come back to my center, and then they're going to watch children of eight more working parents in the community.

Right.

And so that number is increasing as we bring those in.

Last month, the numbers for this program after just a year of being open is that 5700 children were enrolled through the program and 3200 employees were utilizing it in child care programs.

So that's 3200 employees that could leave or did leave, but decided to stay because of this.

We know contextually that if your child is in child care through an employee based child care program, whether it's the center you work in or whether it's Toyota's program, if they're happy, you're less likely to leave, even if you get more money somewhere else.

You want to think about your child as well as yourself.

And so the program has lots of lots of different benefits that it's bringing in.

And Kentucky was the first state in the U.S. to do this.

And we are getting so much national attention right now.

37 states have reached out and asked about it.

New Jersey, I think, is getting ready to drop legislation on it in the upcoming weeks.

And lots of other states are drafting bill language right now that they want to see go into effect because it's one of those programs that you just think, why didn't we think of this before?

It makes sense.

And why haven't other states already done it as well?

Exactly.

And so right now we set a trend.

And for Kentucky, usually the trends we set aren't something everybody else wants to model.

Usually like the Chamber was talking about, we're talking about we're in the bottom ten more right now.

We that this program has got us.

Everybody looking at us.

What's the cost of the program?

Well, you have to think about how much tuition costs.

So it varies.

If you think infant care could be $250 a week all the way up to after school care is usually less than $100.

Might be 75.

And so it really varies on how many full time kids you have, Things like that.

With the numbers that cabinet just released for what they think would be good money in the budget session, we're estimating that if we look at the current enrollment, the 5700, that it would be a $30 million request over the next two.

That's over the next biennium.

But again, think of those eight children being cared for by working parents.

For every provider that is offered the service.