U.S. Department of Health and Human Services

Day Care Centers: 1976-1984--Has Supply Kept up with Demand?

William R. Prosser

Office of Social Services Policy, U.S. Department of Health and Human Services

May 1986

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This paper was prepared by the Office of Social Services Policy (now the Office of Disability, Aging and Long-Term Care Policy) within the U.S. Department of Health and Human Services. For additional information, you may visit the ASPE home page at http://aspe.hhs.gov. The ASPE Project Officer was William Prosser.

The views expressed in this technical analysis paper are those of the author and should not be construed as necessarily representing the official position or policy of 'the Department of Health and Human Services or any office therein.

INTRODUCTION

This paper analyzes the growth of day center capacity in the United States over two points In time, 1976 and 1984, and compares it to the change in potential demand for day care caused by the increased numbers of mothers with young children who were in the labor force. It concludes that day care center supply increased more than the number of young children who have mothers in the labor force.

BACKGROUND

Over the last several decades the labor force participation of women, particularly mothers with young children, has substantially increased. In 1976 the labor force contained 5.4 million mothers with 6.4 million children under the age of six. By 1984 there were 8.0 million women in the labor force who had a total of 9.3 million children under six years of age---a 45 percent increase in the number of children.

As shown in Table 1. surveys of mothers in the labor force indicate that they use a variety of child care arrangements for children under six, as well as for older children. Generally, these arrangements were made in informal situations---other peoples' homes (40%) or the children's own home (30%), more often with relatives than non-relatives---rather than in child care centers (15%). However, the trend since 1965, when the first data on child care arrangements of working women became available, has shown an increasing use of group (center) care. Group care accounted for about six percent the arrangements for children under six years of age in 1965 and about 15 percent in 1982. Mothers working full-time were about twice as likely to use center care as mothers working part-time.

While these data clearly indicate that day/child care is not synonymous with center care, the general public often views it that way. This paper, while not wishing to perpetuate this misconception will analyze only the supply of child care provided by day care centers.

Recently, the Children's Defense Fund (CDF) published Child Care: Whose Priority? A State Child Care Fact Book 1985. The fact book contains data for 1984 obtained by telephone interviews with state officials responsible for licensing child care. Data on the number of centers is reported for 49 states and the District of Columbia. (Alaska is not reported.) The licensed capacity (number of children) for these centers is reported for 34 states and D.C. In 1978, Abt Associates published Day Care Centers in the U.S. A National Profile 1976 - 1977. This report contained the estimated number of day care centers, their capacity, and the estimated accuracy of state licensing lists for all 51 jurisdictions.

The following section compares the state day care center data from these two reports to analyze the apparent growth in the child care center industry.

ANALYSIS

CDF reports that in 1984 there were 61,926 centers on state licensing lists. For the 35 jurisdictions with data on center capacity, there were slots for 2.47 million children. No adjustments were made to the reports given by state licensing officials to compensate for the accuracy of such lists.

In 1976, Abt conducted a study to estimate the total U.S. supply of day care centers and the characteristics of these centers. They found that licensing lists contained a number of facilities which at that point in time did not meet their definition of day care center---provides non-live in child care, has a capacity for 13 or more children, has at least one child enrolled for 25 or more hours per week, was operating at the time of the survey, is open at least 9 months of the year, and enrolls a majority of non-handicapped children. When calling a sample of names on licensing lists from each state, they found nationwide that about 62 percent of the facilities listed met their definition. We do not know whether problems like those found in 1976 still exist in 1984. Lists could be better or worse. However, we believe that it is more accurate read prudent to adjust the 1984 figures downward. This analysis uses the Abt adjustment factor for each state. Adjusting the CDP 1984 data, we conservatively estimate 39,293 centers with a total capacity in the same 35 jurisdictions of 1.61 million slots.

For 1976, Abt reported 18,307 centers with a total capacity of 1.01 million slots (51 jurisdictions) and 0.77 million slots in the same 35 jurisdictions as reported by the Children's Defense Fund. (See Table 2. above and Appendix Tables A.l.-A.4. for state-level data.)

Estimating the capacity of centers in the 16 states that did not report capacity data was accomplished using two methods: (a) the 1984 average capacity (48 children) of day care centers found for the 35 jurisdictions reporting data multiplied by the number of centers; and (b) the average capacity found in 1976 for each of the 16 missing states multiplied times each state's number of centers. These two procedures give estimates of an additional 0.76 to 0.83 million slots; which brings the total estimated slots for 1984 to about 2.1 million slots; compared to 1.0 million in 1976.

The number of centers and their capacity have more than doubled f rom 1976 to 1984. In several states like Connecticut, Iowa, New Hampshire, South Carolina, and Texas the increase has been even more substantial. (However, the data look like there might be an error in the CDF estimate of number of centers in New Hampshire. See Table A.3.)

There is only one state, Arkansas, where the capacity may have decreased. (However, the number of centers in Arkansas did increase. If capacity actually declined, it was caused by a decline in the average number of children per center.)

Day care centers predominately serve children under the age of six. The Abt study reported that the centers' age mix included about 85 percent of children under this age. Since 1976, parents have increased their use of center care for school age children. But, parents also have increased their use of center care for infants. So, centers probably retain approximately the same age mix with at least 80 percent of children served under the age of six.

The increase in capacity nationwide can be compared with the increase in the number of children younger than six whose mothers work to estimate the change in the availability of center care for this population. In 1976 centers could serve 15.6 percent of these children (1.02 million slots/6.4 million children), while in 1984 centers could serve 22.6 percent (2.1 million slots/9.3 million children). This calculation of growth in the day care center industry uses very conservative assumptions. It is quite possible thai the growth has been even more significant than shown here. On the other hand, since we have not compared the growth in centers with the growth in working mothers by state, we can not say whether the change,in supply has been more pronounced in some states over others.¹

CONCLUSION

Whether this increase in supply is sufficient to reasonably satisfy the demand for center care is a hotly contested issue. No doubt the growth has been uneven from community to community. It also must be noted that cost can be a barrier to the accessibility of center care to some parents, particularly, those with lower incomes, and that an increase in slots, therefore, does not guarantee an increase of center care availability for all children. However, generally it appears that the availability of center care for children under six whose mothers work has improved rather than deteriorated since the mid-seventies.

NOTES

1. In a recent paper---Sandra Rofferth and Deborah Phillips, "Working Mothers and the Care of Their Children: 1970 to 1995," NICHD/NAEYC, 1986 (unpublished manuscript)---the authors multiply the unadjusted number of centers, 61,079 (not including an estimate for Alaska), reported by the Children's Defense Fund, times an average enrollment of 75 children (based on their personal communication with R. Neugebaur) and estimate in 1985 that centers could enroll slightly over 4.5 million children. Their estimate is more than twice the estimate made in this paper and would imply that there was enough center..slots on a nationwide basis to serve over 40% of the children under six years of age whose mothers work.

APPENDIX