6 ms·

It's nuts. Living in a big US city, with two young kids, daycare alone for them is $5k/month - so that's about $100k of pre-tax income, not to mention probably

It's nuts. Living in a big US city, with two young kids, daycare alone for them is $5k/month - so that's about $100k of pre-tax income, not to mention probably $2k/month extra spent on a larger apartment than we'd otherwise need. We can afford it, but think of what this does to the income gap and GDP. If either of us made less than $100k/year, it'd make sense for one of us to stop working for a while to look after the kids. This means that already well off people have a big advantage of being able to have a double income, while that's denied to everyone else. It feels like COVID makes this even worse - at least daycare is only a few years before public school takes its place. With that gone, kids need full time care for longer. Does this mean we'll see people dropping out of the workforce in big numbers? What does that mean for recovery? How do other places and countries manage it?

ilstormcloud 6y ago
Third world resident here. $5k a month income would get you living like a king here (with in house nanny) so to hear you have to spend that on daycare alone is insane. If i may ask, What is it about daycare that makes it this expensive? It seems demand is high and the business is profitable if they can charge that much so why isn't competition driving price to be affordable?
- jimbokun 6y ago
  I'm not who you asked, but will add my thoughts anyway. Fundamentally, it is a business that does not scale, as you need a set number of providers per n children, and low values for n are probably going to be associated as better value. There's really no way to get efficiencies or scale, as the personal interaction and attention is what parents are really paying for. So it come down to a question of local real estate prices and prevailing wages for the area, so I'm assuming mindvirus lives in a city with a very high cost of living and real estate costs.
  - ilstormcloud 6y ago
    Makes perfect sense when you put it like that. I didn't realize x kids per carer would mean it can't scale. Thank you.
- mindvirus 6y ago
  Minimum wage is $15/hr (teachers make more), daycare is open 8am-6pm. Law has 4-5 kids per teacher, so that's $1000-$1250/kid minimum, plus floating teachers (can't close a class if one teacher is sick), and there's rent and administrators. So the $2.5k/kid is reasonable given all of that - I doubt the school makes a lot of money. To be fair, you can also get a nanny for about that (going rate is $20/hr or so) which works out with two kids. Still though, my point is that high costs of child care in the city are a wedge that furthers the gap between rich and everyone else.
  - ilstormcloud 6y ago
    Ah, I didn't realize the children per teacher. It makes sense now. Thank you.
  - rukittenme 6y ago
    > Law has 4-5 kids per teacher Is this true? When I was a kid my daycare was like 30 kids per teacher. It was called "Mother's Day Out". I can't remember the cost but judging by the amount of time I spent there it was basically free.
- econcon 6y ago
  > $5k a month income would get you living like a king here (with in house nanny) Comparing just dollar value of services is not of much use across countries. It's like saying, interest rate in India is 6% while in US it's 1% why Americans are not putting their money in India. The info you are missing is inflation. 5k is not a lot in mega US cities and these guys will not move to some cheap city because they'll not find a job that pays that well and gives them ability to support such a high quality of life in smaller/cheaper cities.
- geodel 6y ago
  > Third world resident here. $5k a month income would get you living like a king here Unsurprising, because only king would be earning this kind of income per month.
  - ilstormcloud 6y ago
    A king and people who work for NGOs :)
armandososa 6y ago
Mexican here: the state provides free/cheap daycare for working mom's children starting at ~12 weeks old.
- jscholes 6y ago
  Could you provide more details on this (Spanish sources are fine)? I'm living in Mexico and not aware of it.
- mac01021 6y ago
  This is just a nit, but I assume a single father is able to utilize this too?
thorwasdfasdf 6y ago
And a lot of regulations make it worse than it needs to be by limiting number of kids per classroom/teacher, it just drives up the expenses even more. Here in CA Daycare costs 1800$/mo and 3000$/mo in SF. Out in Houston, where the standard of living is much higher, I hear it's only 600$/mo.
- chomp 6y ago
  You get a range of options, and it definitely depends on the age of your child. $700-800/mo is about what I'd call the middle of the road for childcare here. You can pay less and get a sketchy center that basically gets your kid a bare room and an oversized class for 8 hours, or pay more for really premium preschool with cooking classes and such, or montessori for closer to $1200-$1500. Children to teacher ratios do seem to be lower in California, which is probably what is (partially) increasing those costs.
spacedcowboy 6y ago
I and my sister both had our first kids within 14 days of each other, she's in the UK, I'm in the US. She: - Elected for a home birth, so the NHS put an ambulance on stand-by outside her house once the midwife said things were coming to a head, in case things went south. - Had regular home-visits by the nurse after the birth until she was happy without them, which focus was both the child and my sister's well-being. no question too foolish to ask, practical advice, that sort of thing, you know ... support. - Got 6 months paid off work (state + company perks) - Got free daycare when the kid was young. - Gets child-support payments from the government every 2 (?) weeks. Not much, but every little counts. - Gets free-at-the-point-of-need healthcare, of course. - Gets excellent free schooling, all the schools are rated above average where she lives, in a Northern city not known for its largesse. I: - was kicked out of hospital in 3 days because that's what the insurance would pay for - had the nurses give me stuff to handle the first few days (bottles, nappies, etc.) under the table because they weren't actually allowed to. - Got no support after we left the building - Got 2 weeks paid leave. - Almost had a nervous breakdown because of what we didn't know, had parents fly out to help and finally got some sleep after 2 weeks (he's an "active child"...) - Had to bump up the insurance costs significantly from X+Spouse to X+family, because there's no X+Spouse+1, so we're indirectly paying for those with X+spouse+4 - Paid a fortune for daycare in the valley when it became time. - Realised that our designated local school was bloody awful (3/10) despite being in a "good school district". Didn't win the lottery. So we pay for private school, currently about $15k/year I can afford it, but the difference between the "people before profits" approach the UK takes, with its much more diverse social safety net, and the "profits über alles" approach the US takes is stark. The only reason I'm still in this country is because my partner wants to stay, if I had my way, I'd be living on the beach in the UK, probably retired... Oh, and she's an air-hostess for BA, her partner works for telecoms companies doing their wiring at the top of poles. THey're not particularly well off (I have a lot more disposable income as a FANNG s/w engineer) but their actual life is a lot easier.
- Engineering-MD 6y ago
  I’m a big supporter of nationalised healthcare, but the UK doesn’t have a great fertility rate, comparable to the USA, suggesting this doesn’t have that much of an impact on people’s desire for children.
dgut 6y ago
Is that the case everywhere in the US? In Spain, a good private nursery ("guarderia") cost tops €250-350 per month anywhere outside of Madrid and Barcelona. Children of low income households have free public daycare. From the age of 3y, children go to "school" and it's 100% free from that point on. You have the choice between public (secular education), consertado (semi-private with more emphasis on Christianity, science is not discriminated), or private (usually bi- or trilingual). The last option isn't free and can cost €400-1000 monthly. Books aren't free unless, again, low-income. Giving birth, check-ups and the like is free. In hindsight, it's quite perfect -- but the economy is currently in a terrible state.
JamesBarney 6y ago
Why is day care so expensive? If you had an adult who watched just 6 kids they'd make 180k a year which seems like an insane amount of money to make sure a kid doesn't stick his/her finger in a socket. If instead they made closer to the median salary then childcare would be closer to $500/month per kid which seems much more reasonable.
RestlessMind 6y ago
A big city in the US is going to have a lot of reasonable-sounding regulations like: minimum wage of $15/hr, requirement of max 4 kids per teacher until the age of 2, insurances, square footage etc. (An example of 26-page regulations in California[1]). Say you need 9 hr care every day from 9-6. That adds up to 45hrs/week. Even pooling 4 kids together, you are looking at ~700$/week cost per teacher at minimum wage. Have 1.5-2x factor for more experienced or more skilled teachers. Add another 2-3x for rent, insurance, utilities, admin expenses, backup teacher expenses etc. And you are looking at 2K-4K per teacher (or 500-1K per kid) expense per week, or 2-4K per month per kid. Completely aligns with my experience in SV, across childcare centers of various qualities. [1] https://www.cdss.ca.gov/Portals/9/Regs/1cccman.pdf?ver=2019-07-02-111907-160 https://www.cdss.ca.gov/Portals/9/Regs/1cccman.pdf?ver=2019-...
- mindvirus 6y ago
  From an individual perspective yes it makes sense, but from a societal one it seems harmful. It means that anyone who makes less than $100k/year - a lot of money - has financial incentive to either not have kids or to drop out of the work force. And given the wage gap, the people who drop out will disproportionately be women. It also means that couples making more than that each end up with an even bigger advantage, since they can stay in the workforce and continue to grow their careers.
  - RestlessMind 6y ago
    > but from a societal one it seems harmful Why? You can always subsidize childcare via taxes. You can see that happening in the rich countries with dwindling populations. It won't happen in the US yet because the population is still growing thanks to immigration and also due to the ideological opposition to any public spending by a major party.

ilstormcloud 6y ago

Third world resident here. $5k a month income would get you living like a king here (with in house nanny) so to hear you have to spend that on daycare alone is insane. If i may ask, What is it about daycare that makes it this expensive? It seems demand is high and the business is profitable if they can charge that much so why isn't competition driving price to be affordable?

jimbokun 6y ago
I'm not who you asked, but will add my thoughts anyway. Fundamentally, it is a business that does not scale, as you need a set number of providers per n children, and low values for n are probably going to be associated as better value. There's really no way to get efficiencies or scale, as the personal interaction and attention is what parents are really paying for. So it come down to a question of local real estate prices and prevailing wages for the area, so I'm assuming mindvirus lives in a city with a very high cost of living and real estate costs.
- ilstormcloud 6y ago
  Makes perfect sense when you put it like that. I didn't realize x kids per carer would mean it can't scale. Thank you.
mindvirus 6y ago
Minimum wage is $15/hr (teachers make more), daycare is open 8am-6pm. Law has 4-5 kids per teacher, so that's $1000-$1250/kid minimum, plus floating teachers (can't close a class if one teacher is sick), and there's rent and administrators. So the $2.5k/kid is reasonable given all of that - I doubt the school makes a lot of money. To be fair, you can also get a nanny for about that (going rate is $20/hr or so) which works out with two kids. Still though, my point is that high costs of child care in the city are a wedge that furthers the gap between rich and everyone else.
- ilstormcloud 6y ago
  Ah, I didn't realize the children per teacher. It makes sense now. Thank you.
- rukittenme 6y ago
  > Law has 4-5 kids per teacher Is this true? When I was a kid my daycare was like 30 kids per teacher. It was called "Mother's Day Out". I can't remember the cost but judging by the amount of time I spent there it was basically free.
econcon 6y ago
> $5k a month income would get you living like a king here (with in house nanny) Comparing just dollar value of services is not of much use across countries. It's like saying, interest rate in India is 6% while in US it's 1% why Americans are not putting their money in India. The info you are missing is inflation. 5k is not a lot in mega US cities and these guys will not move to some cheap city because they'll not find a job that pays that well and gives them ability to support such a high quality of life in smaller/cheaper cities.
geodel 6y ago
> Third world resident here. $5k a month income would get you living like a king here Unsurprising, because only king would be earning this kind of income per month.
- ilstormcloud 6y ago
  A king and people who work for NGOs :)

armandososa 6y ago

Mexican here: the state provides free/cheap daycare for working mom's children starting at ~12 weeks old.

jscholes 6y ago
Could you provide more details on this (Spanish sources are fine)? I'm living in Mexico and not aware of it.
mac01021 6y ago
This is just a nit, but I assume a single father is able to utilize this too?

thorwasdfasdf 6y ago

And a lot of regulations make it worse than it needs to be by limiting number of kids per classroom/teacher, it just drives up the expenses even more. Here in CA Daycare costs 1800$/mo and 3000$/mo in SF. Out in Houston, where the standard of living is much higher, I hear it's only 600$/mo.

chomp 6y ago
You get a range of options, and it definitely depends on the age of your child. $700-800/mo is about what I'd call the middle of the road for childcare here. You can pay less and get a sketchy center that basically gets your kid a bare room and an oversized class for 8 hours, or pay more for really premium preschool with cooking classes and such, or montessori for closer to $1200-$1500. Children to teacher ratios do seem to be lower in California, which is probably what is (partially) increasing those costs.

spacedcowboy 6y ago

I and my sister both had our first kids within 14 days of each other, she's in the UK, I'm in the US. She: - Elected for a home birth, so the NHS put an ambulance on stand-by outside her house once the midwife said things were coming to a head, in case things went south. - Had regular home-visits by the nurse after the birth until she was happy without them, which focus was both the child and my sister's well-being. no question too foolish to ask, practical advice, that sort of thing, you know ... support. - Got 6 months paid off work (state + company perks) - Got free daycare when the kid was young. - Gets child-support payments from the government every 2 (?) weeks. Not much, but every little counts. - Gets free-at-the-point-of-need healthcare, of course. - Gets excellent free schooling, all the schools are rated above average where she lives, in a Northern city not known for its largesse. I: - was kicked out of hospital in 3 days because that's what the insurance would pay for - had the nurses give me stuff to handle the first few days (bottles, nappies, etc.) under the table because they weren't actually allowed to. - Got no support after we left the building - Got 2 weeks paid leave. - Almost had a nervous breakdown because of what we didn't know, had parents fly out to help and finally got some sleep after 2 weeks (he's an "active child"...) - Had to bump up the insurance costs significantly from X+Spouse to X+family, because there's no X+Spouse+1, so we're indirectly paying for those with X+spouse+4 - Paid a fortune for daycare in the valley when it became time. - Realised that our designated local school was bloody awful (3/10) despite being in a "good school district". Didn't win the lottery. So we pay for private school, currently about $15k/year I can afford it, but the difference between the "people before profits" approach the UK takes, with its much more diverse social safety net, and the "profits über alles" approach the US takes is stark. The only reason I'm still in this country is because my partner wants to stay, if I had my way, I'd be living on the beach in the UK, probably retired... Oh, and she's an air-hostess for BA, her partner works for telecoms companies doing their wiring at the top of poles. THey're not particularly well off (I have a lot more disposable income as a FANNG s/w engineer) but their actual life is a lot easier.

Engineering-MD 6y ago
I’m a big supporter of nationalised healthcare, but the UK doesn’t have a great fertility rate, comparable to the USA, suggesting this doesn’t have that much of an impact on people’s desire for children.

dgut 6y ago

Is that the case everywhere in the US? In Spain, a good private nursery ("guarderia") cost tops €250-350 per month anywhere outside of Madrid and Barcelona. Children of low income households have free public daycare. From the age of 3y, children go to "school" and it's 100% free from that point on. You have the choice between public (secular education), consertado (semi-private with more emphasis on Christianity, science is not discriminated), or private (usually bi- or trilingual). The last option isn't free and can cost €400-1000 monthly. Books aren't free unless, again, low-income. Giving birth, check-ups and the like is free. In hindsight, it's quite perfect -- but the economy is currently in a terrible state.

JamesBarney 6y ago

Why is day care so expensive? If you had an adult who watched just 6 kids they'd make 180k a year which seems like an insane amount of money to make sure a kid doesn't stick his/her finger in a socket. If instead they made closer to the median salary then childcare would be closer to $500/month per kid which seems much more reasonable.

RestlessMind 6y ago

A big city in the US is going to have a lot of reasonable-sounding regulations like: minimum wage of $15/hr, requirement of max 4 kids per teacher until the age of 2, insurances, square footage etc. (An example of 26-page regulations in California[1]). Say you need 9 hr care every day from 9-6. That adds up to 45hrs/week. Even pooling 4 kids together, you are looking at ~700$/week cost per teacher at minimum wage. Have 1.5-2x factor for more experienced or more skilled teachers. Add another 2-3x for rent, insurance, utilities, admin expenses, backup teacher expenses etc. And you are looking at 2K-4K per teacher (or 500-1K per kid) expense per week, or 2-4K per month per kid. Completely aligns with my experience in SV, across childcare centers of various qualities. [1] https://www.cdss.ca.gov/Portals/9/Regs/1cccman.pdf?ver=2019-07-02-111907-160 https://www.cdss.ca.gov/Portals/9/Regs/1cccman.pdf?ver=2019-...

mindvirus 6y ago
From an individual perspective yes it makes sense, but from a societal one it seems harmful. It means that anyone who makes less than $100k/year - a lot of money - has financial incentive to either not have kids or to drop out of the work force. And given the wage gap, the people who drop out will disproportionately be women. It also means that couples making more than that each end up with an even bigger advantage, since they can stay in the workforce and continue to grow their careers.
- RestlessMind 6y ago
  > but from a societal one it seems harmful Why? You can always subsidize childcare via taxes. You can see that happening in the rich countries with dwindling populations. It won't happen in the US yet because the population is still growing thanks to immigration and also due to the ideological opposition to any public spending by a major party.