Minnesota's child care costs among highest in the nation

The average annual cost of child care for an infant in Minnesota is right around $12,000, according to the survey. While Massachusetts has a higher cost, Minnesotans pay more for child care in relation to their income than any other state.

The survey by the Association of Child Care Resource and Referral Agencies finds Minnesotans pay an average 15 percent of their income for child care. Ann McCully, director of the association's Minnesota network, says the survey's findings are not an argument for lower child care costs.

"That really would be the opposite direction," says McCully. "One of the key things about quality, which in turns leads to school readiness, is this issue of having a smaller group of kids, a well-educated provider, a good environment -- those all cost money."

McCully says the higher price reflects positively on the state's efforts to improve the quality of child care.

State and federal governments really need to step up ... help families pay for that high quality child care that we know gives their children the right start in life.

"One of the things that's strong in Minnesota is the ratio of provider to the children. And since so much of the cost of child care is the labor, then when you have very few providers matched with very few children your costs go up. We think that's a good thing," says McCully.

Minnesota, for instance, requires one caregiver for every four infants. Some states allow double that ratio.

McCully says those costs are a steep burden on low and middle-income parents trying to make ends meet. Parents, she says, cannot be squeezed any more, but neither can the day care providers.

"This is a field that operates on such a thin profit margin. Centers operate on less than 1 percent, in a study done by the Department of Human Services a couple of years ago," says McCully. "Family child care providers, when you average out the true hourly wage, it looks like something like $3 an hour."

That leaves added support from federal, state and private contributions to fill in the gap. Chad Dunkley, president of the Minnesota Child Care Association, says the report is further affirmation that investment pays off.

"Investing in children at their earliest ages is the best investment that a state can make, and a society can make," says Dunkley. "I think this report really focuses on state and federal governments really need to step up, and not pay for all their child care costs, but help families pay for that high quality child care that we know gives their children the right start in life."

Dunkley says Minnesota's child care investment is part of the reason the state has a higher median income, lower crime rate, and higher educational attainment than other states. But Dunkley laments the population of Minnesotans who are left behind by the high cost of child care.

Wilder Research released its own study on Minnesota child care last fall. That study backs up the current findings that the high and rising cost of child care hurts low-income parents more.

"On average it costs about 10 percent of household income in this state. But for low-income families, it's a bigger burden on their income," says Richard Chase, a consulting scientist with Wilder. "It's about 28 percent of their income. It can cost as much or more as college tuition."

Chase says the Resource and Referral Agency survey puts Minnesota among states that have good reputations for early education effort.

"It's good company to be in -- the states that are ranked near the top. New York, California, Massachusetts, New Jersey, Virginia, Wisconsin, Pennsylvania. It seems like these are states that value education," says Chase. "I think some of those states are leaders in preschool education and funding for young children, early care in education."

Chase interprets the survey's findings as an indication of a commitment to care at an early age, that professionals say has a substantial payback.

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