The impact of COVID-19 on the U.S. child care market: Evidence from stay-at-home orders. (June 2021)

• Record Type: Journal Article
• Authors: Ali, Umair; Herbst, Chris M.; Makridis, Christos A.
• Is Part Of: Economics of education review. Volume 82(2021)
• Publication Date: 2021-06
• Subjects: Child care -- Coronavirus -- COVID-19 -- Early care and education -- Stay-at-Home Orders; H75 -- J21 -- I28; Education -- Economic aspects -- Periodicals; 370
• DOI: 10.1016/j.econedurev.2021.102094
• Languages: English
• ISSNs: 0272-7757

Abstract

Abstract: Stay-at-home orders (SAHOs) were implemented in most U.S. states to mitigate the spread of COVID-19. This paper quantifies the impact of these containment policies on a measure of the supply of child care. The supply of such services may be particularly vulnerable to a SAHO-type policy shock, given that many providers are liquidity-constrained. Using plausibly exogenous variation from the staggered adoption of SAHOs across states, we find that online job postings for early care and education teachers declined by 16% after enactment. This effect is driven exclusively by private-sector services. Indeed, hiring by public programs like Head Start and pre-kindergarten has not been influenced by SAHOs. We also find that ECE job postings increased dramatically after SAHOs were lifted, although the number of such postings remains 4% lower than that during the pre-pandemic period. There is little evidence that child care search behavior among households was altered by SAHOs. Because forced supply-side changes appear to be at play, our results suggest that households may not be well-equipped to insure against the rapid transition to the production of child care. We discuss the implications of these results for child development and parental employment decisions.