This report explores the implications of a hypothetical policy change that makes child care assistance provided through the Child Care and Development Fund (CCDF), the nation’s primary public child care subsidy program for families with lower incomes, more available to parents in school or training (student parents). This hypothetical policy change would: 1) provide sufficient funding to serve all eligible parents who want assistance to attend school or training, 2) relax current education and training-related eligibility constraints, including eliminating work requirements for student parents, and 3) ensure resources can be used to pay for the kinds of child care student parents need. Using the Urban Institute’s Analysis of Transfers, Taxes, and Income Security (ATTIS) microsimulation model, we find:
- About 110,000 student parent families nationwide received child care assistance in 2018, a small share of about one million families receiving subsidies that year, according to an analysis of CCDF caseload data. Only one in eight (13 percent) student parents who were eligible for child care assistance under state rules are estimated to have received subsidies, an estimate that excludes student parent families who receive Temporary Assistance for Needy Families (TANF) assistance and whose education and training were likely linked to TANF program requirements.
- Implementing the hypothetical policy change described above in 2021 would have significantly increased both the number of parents who were eligible for and the number of parents participating in CCDF. Specifically, we find:
- More than 1.1 million student-parent families would have been eligible, a 33 percent increase from 2018 (the most recent year with the data required for our analysis).
- About 485,000 student parent families would have received subsidies, more than four times the number of families receiving subsidies in 2018. About 60 percent of the families receiving subsidies in 2021 would have been Black, Hispanic/Latinx, or AAPI.
- Parents who earned their credential because of child care subsidies would have increased their annual earnings by 26 percent in the year after completing it compared to what they would’ve earned without a credential. As a result of these earnings gains, child poverty in these families would decline by 4 percentage points.
The findings suggest that (1) additional federal investments in child care, (2) a focused effort to relax state eligibility restrictions for student parents including eliminating work requirements in states that require student parents to also work, and (3) steps to ensure that student parents can use their subsidies to purchase the various forms of child care that meets their needs including relative care and home-based options that are most likely to be available to them for the schedules they need are policy actions that could not only improve the employment and earnings of parents seeking further education and training, but could also reduce the poverty among their children. However, although child care is a necessary support for many student parents and the hypothetical policy outlined in this report could make a difference in their financial well-being, research also suggests that it will be necessary to address other barriers to education and training faced by student parents, particularly parents of color.
Read the accompanying fact sheet: Expanding Child Care Subsidies to Parents in Education and Training