Washington state is losing $1.5 billion in taxes because many parents have stopped working and are taking care of their children at home, according to a new report.
Child care costs have reached record highs in the period of inflation that arrived after the COVID-19 pandemic. According to the U.S. Census Bureau, in 2021, child care ranged from $4,810 a year for a school-age child to $15,417 for infant care, depending on the location.
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“Washington residents in this regard are facing the concerns that many other parents are in states across the country,” Alex Beene, a financial literacy instructor for the University of Tennessee at Martin, told Newsweek. “Child care costs have increased substantially over the past two decades, leaving some parents to drop out of the workforce because that’s actually the more financially viable option for them.”
Those costs are making a significant impact in Washington, where the lost family income, turnover and absenteeism was estimated to cost $6.9 billion in 2023, according to a report from public policy research firm ECOnorthwest.
When split among all 7.95 million Washington residents, that would amount to a cost of $870 each, and a gross state product loss of $6 billion. In all, looking at lost state, federal and local taxes, Washington parents not working because of child care needs cost nearly $1.5 billion, the report found.