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

Ali, Umair; Herbst, Chris M.; Makridis, Christos A.

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.

Citation

Ali, U., Herbst, C. M., & Makridis, C. A. (2021). The impact of COVID-19 on the U.S. child care market: Evidence from stay-at-home orders. Economics of Education Review, 82, Article 102094. https://doi.org/10.1016/j.econedurev.2021.102094

• Journal Article Type: Article
• Acceptance Date: Feb 15, 2021
• Online Publication Date: Feb 19, 2021
• Publication Date: 2021-06
• Deposit Date: Jan 28, 2025
• Journal: Economics of Education Review
• Print ISSN: 0272-7757
• Publisher: Elsevier
• Peer Reviewed: Peer Reviewed
• Volume: 82
• Article Number: 102094
• DOI: https://doi.org/10.1016/j.econedurev.2021.102094
• Keywords: Child care, Coronavirus, COVID-19, Early care and education, Stay-at-Home Orders