The Children’s Center, a nonprofit child care provider in the Hampton Roads region, is among thousands of Virginia facilities running at a deficit amid the COVID-19 pandemic.
After more than a year of navigating the COVID-19 pandemic, Rosalind Cutchins is braced for a busy June as she prepares to reopen two Head Start programs at her child care centers across the Hampton Roads region. But she’s been confronted by a staffing shortfall — 22 unfilled positions across eight different locations.
It’s a challenge providers are facing across the commonwealth as businesses reopen and Virginia moves into the recovery phase of its post-pandemic economy. In many ways, it’s already ahead, with a revenue surplus and an unemployment rate, at 4.7 percent, that’s more than a full percentage point lower than many of its closest neighbors.
But when it comes to its labor force, Virginia is still in a period of decline. From February 2020 to April 2021, participation dropped by nearly 4 percent. With only 62.7 percent of Virginians currently employed or actively seeking work, participation is lower than it was in July 2020, when emergency restrictions were still in place across the state.
“I think that comparing the April 2016 labor force to the April 2021 labor force is useful because it indicates zero growth,” wrote Timothy Aylor, a senior economist for the Virginia Employment Commission, in an email last week. “Or, put another way, that pandemic-era trends have erased all labor force gains made since 2016.”
Experts worry that staffing shortages among child care providers could make the situation worse. The industry isn’t the only one reporting a dearth of interested workers, but Cutchins said it could affect the availability of services.
Statewide, nearly 10 percent of Virginia’s 6,047 licensed child care facilities were still closed as of May 28, according to data from the Virginia Department of Social Services. But even when centers reopen, they may be doing so with less capacity. The industry is still subject to the same masking, sanitation and distancing guidelines put in place last year. And because children younger than 12 still aren’t eligible for the COVID-19 vaccines, Cutchins said facilities are still required to cohort children and employees in smaller groups.
“The bottom line is that it makes staffing and staffing patterns more difficult,” she said. Before the pandemic, for example, it was possible for one employee to watch two children from different classes if they arrived before the school day started. But under the current guidelines, those children would need to stay separate to lower the potential risk of exposure.
As a result, most providers need more staff than usual to reopen fully. Currently, many of those positions are going unfilled. Rich Schultz, president of Smart Beginnings of Greater Richmond, a nonprofit coalition focused on early childhood education, said his coalition began polling local providers and found that — of the 26 child care programs they’ve reached so far — 85 percent reported staffing shortages. In total, there were 114 open teaching positions across all of the facilities.
“If our community can’t access quality child care, that’s a problem our employers should care about,” he said. Many providers are reducing their enrollment numbers to comply with pandemic guidelines and the teacher-to-student ratios already required by the state.
“We just don’t have enough staff right now to open at full capacity this year,” Cutchins said. “So it absolutely has an impact. And how many people we can hire is going to determine how many classrooms we can open up this summer into the fall.”
In many ways, the current staffing challenges have been a long time coming for the industry. Even before the pandemic, experts widely acknowledged that the costs of providing child care — from employee salaries to facility costs to food and other supplies — met or exceeded what most facilities earned. Some federal and state funding is available, largely through waivers for low-income families, but parents generally subsidize those expenses with tuition payments.
But there’s a limit to how much families are able — and willing — to pay for child care, Cutchins said. And with thin margins at most facilities, wages for employees are notoriously low. As of 2019, the median pay in Virginia was $10.96 an hour — a seven percent increase since 2017, according to data from the University of California, Berkeley.
Emily Griffey, policy director for the child advocacy group Voices for Virginia’s Children, said the pandemic made it even more difficult to offer competitive wages. Now that hundreds of employers are raising salaries and offering sign-on bonuses to new workers, the problem has only gotten worse. Cutchins rolled out her own bonus for open positions, including teachers, bus drivers and custodians, but said she’s still having difficulties filling slots.
“I think the entire field would love to be competitive,” she said. “We know our industry comes in low. We also know you can’t charge parents the amount of money we would have to pay to be competitive without some kind of extra subsidy or support.”
Child care has been an emphasis on the part of many state and federal leaders. The first CARES Act set aside $70 million for Virginia to expand an existing grant program for providers. After some initial difficulties — including a quickly-exhausted funding stream — Cutchins said Virginia offered four rounds of grant applications for open facilities with additional federal dollars.
On Friday, Gov. Ralph Northam also announced $3 million in funding for a broader grant program aimed at helping small businesses recruit new hires. The fund, open to companies with fewer than 100 employees, will match up to $500 in payments to any worker hired after May 31 as long as the position pays at least $15 an hour. It’s designed to help Virginians “transition back into living wage jobs,” according to a news release — “particularly in the child care industry.”
Virginia’s share of the American Rescue Plan also includes huge set-asides for the field. According to Griffey, that includes $488 million for child care stabilization grants — 90 percent of which must go directly to providers — and an additional $305 million aimed at expanding family waiver eligibility or making system improvements. Currently, the state is approaching a deadline to decide how to allocate and distribute the stabilization grants. She’d like to see an emphasis on wages — offering higher salaries as a condition of the funding, for example, or including additional money as an add-on to providers who promise to raise pay for employees.
“It’s been an option for them to use funding for higher wages and things like hiring bonuses, but it hasn’t been emphasized,” Griffey said. “But if the state says, ‘You’re heroes who deserve the extra pay, too,’ I think that message would be even more resonant.”
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