As Childcare Costs Spiral, Here’s What Parents In MN Are Paying

MINNESOTA — Babysitters, nannies, and daycare workers in Minnesota are among the best paid in the country, according to a new report that looks at the rising cost of child care.

The 2024 Cost of Care Report by Care.com compared child care costs across all states, the District of Columbia, and Puerto Rico and ranked them, with No. 1 being the lowest rates and No. 52 being the highest. The online platform aims to help families find caregivers for children and other family members.

Here’s a look at childcare costs in Minnesota:

• The average rate for babysitters ranks 20th-highest with hourly rates of $21.15 and weekly rates of $169.17
• The average rate of nannies ranks 18th-highest with hourly rates of $18.53 and weekly rates of $741.26
• The average rate for child care centers ranks 18th-highest with hourly weekly rates of $228.04

As part of its 11th annual report on childcare costs, released earlier this month, Care surveyed 2,000 parents. It showed that, on average, families spend nearly a quarter (24 percent) of their household income on child care. Nearly half (47 percent) spent more than $18,000 on daycare and babysitting in 2023.

The average burden on the household budget for child care is three times more than the 7 percent deemed affordable by the U.S. Department of Health and Human Services, the report noted.

To pay for child care, many parents dip into savings. About a third (35 percent) of survey respondents said they used their savings, on average depleting about 42 percent of the money they banked.

The report is based on the first available public data on the impact of what’s called the “child care cliff” — that is, the disappearance of childcare programs with the expiration last September of federal pandemic-related assistance.

• Related: ‘A Moment Of Reckoning’ For U.S. Child Care System

The survey found that 39 percent of parents are paying more now because their provider lost federal assistance. And 79 percent expect to see rates increase in 2024. Among those, 54 percent expect to pay about $7,000 more this year. About 43 percent of respondents had more trouble finding childcare last year than in prior years.

About 65 percent of parents surveyed reported being on a waitlist, with 81 percent juggling multiple waitlists and 43 percent waiting four months or longer. Since September, 62 percent of those on a waitlist said the centers had closed.

As they wait, more than half of respondents on a waitlist said they’re paying about $200 a week more for child care.

Most respondents said mounting childcare costs should be an issue in the 2024 presidential election, with 88 percent saying their votes will be influenced by a candidate’s position on childcare access and affordability.

The childcare crisis should be a major red flag for everyone, not just parents, Brad Wilson, CEO of Care.com, said in a news release.

“Within the first five years of their child’s life, parents are being forced into a financial hole that is nearly impossible to climb out of,” Wilson said. “A healthy economy depends upon the ability for people to save and spend, but given the crushing weight of childcare costs, those pillars are crumbling. … It is a systemic failure that will impact our nation’s economic growth, and that affects us all.”