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Licensed Child Care in Washington State: 1998 

Executive Summary

Washington State's Department of Social and Health Services (DSHS) subsidized care for about 54,000 children in each month of 1998. These children are from low-income families with parents who are working, going to school, homeless, or in some other DSHS program. The number of children receiving DSHS subsidies has tripled in the past decade. About two-thirds of DSHS-subsidized children are cared for in licensed family homes or child care centers.

Federal regulations require that Washington State tie their subsidy rates to a local market survey of child care rates conducted at least every two years. To comply with this regulation DSHS conducts a biennial survey of all child care centers and a sample of licensed family home providers. In addition to child care rates, the surveys provide information on the child care industry. This report describes the surveys conducted in the spring of 1998. A total of 1,137 child care centers and 1,527 family home providers were interviewed.

Major Findings:
Findings About Child Care Rates

• Over the period 1990 to 1998, the inflation-adjusted cost of care increased 22% in centers and 20.5% in homes. In the past two years (1996 to 1998), the price of full time family home care after adjusting for inflation climbed by 3% (from $396 to $406) and that of centers went up 4% (from $433 to $453).

• Child care rates vary by geographic areas and the age of the child.

• Geographic region is a strong predictor of child care rates: average prices tend to be higher in Western Washington than in Eastern Washington. Average rates are highest in King County (Seattle).

• In general, centers charge more than licensed family homes.

• Child care centers that provided health insurance to their employees, were for-profits, or had less than 5% of their children subsidized by DSHS charged higher rates.

• Family home providers who had some college education charged higher rates than family home providers without any college education.

Findings About Child Care Market

• An estimated 170,200 children in Washington State were in licensed care in spring of 1998. Almost 70% of these children were in child care centers and the remaining 30% were in licensed family homes.

• Licensed providers in 1998 grossed almost $700 million dollars and employed approximately 29,400 people.

• Estimated total revenues for the entire child care industry (licensed and unlicensed) in Washington exceeded $1 billion dollars in 1998.

• After six years of growth, there was a decline in the number of licensed family homes from 8,600 in 1996 to 7,861 in 1998. The number of centers, on the other hand, rose from 1,796 in 1996 to 1,840 in 1998.

• The number of children in licensed care increased 4% per year from 1996 to 1998.

• Children of preschool age (between 2½ and 5) were much more likely to be in licensed care than children of other ages. About one out of every three preschoolers (39%) attended a licensed home or child care center. Only 9% of infants were in licensed care.

Findings About Child Care Centers

• The number of children in child care centers grew by 38% in the eight year period 1990 to 1998, from 85,000 in 1990 to 116,900 in 1998. Between 1996 and 1998, the number of children in child care centers rose 17%.

• Forty-one percent of children in child care centers in 1998 were preschoolers; 4% were infants.

• The vast majority of centers provide full-time care for preschool age children (77%), while only about one-third of centers provide full-time care for infants (32%).

• Fifty-six percent of children in centers in 1998 received full-time care.

• The proportion of centers with vacancies declined from 66% in 1996 to 57% in 1998.

• The vacancy rate (number of vacancies/total capacity) declined from 16% to 12% from 1996 to 1998.

• Pay for teachers at centers averaged $7.73 per hour; aides averaged $6.34 per hour.

• After adjusting for inflation, there has been no increase in average wages since 1992.

• Only 8% of centers were open before 6 in the morning; 4% were open until 7 or later in the evening.

Findings About Licensed Family Homes

• The number of children in licensed family homes has declined recently from 60,100 in 1994 to 53,300 in 1998.

• Thirty-five percent of children in licensed family homes in 1998 were preschoolers; 6% were infants.

• Most licensed family homes provide full-time child care for preschoolers (77%), while less than one-quarter of family homes provide full-time care for infants (24%).

• Fifty-nine percent of children in licensed family homes in 1998 received full-time care.

• Somewhat more than half of family homes (56%) had been in operation for four years or more.

• Thirty-seven percent of family homes had vacancies, virtually the same as in 1996.

• The 1998 vacancy rate of 14% for family homes (number of vacancies/total capacity) was unchanged from 1996.

• Since 1992, the share of family home providers with formal training in early child education or child development has increased from 56% in 1994 to 74% in 1998.

• Assistants in family homes earned $6.43 per hour on average. Assistants' wages (after adjusting for inflation) have increased approximately 2% per year since 1992.

• Sixty-nine percent of family homes had liability insurance in 1998, compared to 58% in 1996.

• Over three-quarters of licensed family homes (77%) participated in the USDA food program in 1998

• Only 15% of licensed family homes were open before 6 in the morning; 9% were open until 7 or later in the evening.

Findings About DSHS-Subsidized Child Care

• Child care was subsidized for 104,500 children over the course of federal fiscal year 1998. An estimated 54,500 children per month received subsidized care in either licensed or exempt settings in 1998.

• An estimated 32,400 children received subsidized child care in either a licensed family home or child care center in April and May of 1998.

• Eighteen percent of children in centers and 20% of children in family homes received care subsidized by DSHS in the spring of 1998.

• Eighty-seven percent of centers cared for at least one DSHS-subsidized child in 1998.

• Fifty-two percent of licensed family homes cared for at least one DSHS-subsidized child in 1998.

• Three-quarters of centers that serve DSHS children say that the parents of subsidized children generally paid their portion of the fees on time. A substantial majority of centers (60%) report that the payment problems for subsidized families are the same as those for non-subsidized families with the remaining 40% divided over which families were worse.

• In child care centers, 76% of all children are non-Hispanic whites, 9% are black, and 7% are Hispanic. In licensed family homes, 78% of all children are non-Hispanic whites, 12% are Hispanic, and 4% are black.

• The ethnic composition of both children and providers in licensed family homes is similar to the ethnic composition of children under five in the state as a whole. Centers have a slightly higher proportion of black children than their proportion in the state overall.

• Licensed family home providers tend to serve children who share their ethnicity: 85% of the children cared for by white providers are white; 63% of the children cared for by Hispanic providers are Hispanic; and 62% of the children cared for by black providers are black.

• While 78% of all children in licensed family homes are white, only 55% of children in licensed family homes who are subsidized by DSHS are white. Over half of all black and Hispanic children in licensed family homes are subsidized by DSHS.

• Child care centers with a high proportion of children subsidized by DSHS are more ethnically heterogeneous than the state as a whole. While about one-third of children that attend centers go to centers where at least 25% of the children are subsidized by DSHS, over half of all Hispanic, Black, and Native American children that attend child care centers go to such centers.

Modified: Thursday November 17 2005

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