Report | January 14, 2021

Home-Based Child Care: A Surprising Key to Keeping the California Workforce Strong

Policymakers must support the child care system used by most families

Surprisingly, the vast majority of child care in the United States is home-based. Nationwide, home-based child care (HBCC) accounts for 97 percent of all child care settings and serves almost two-thirds of the children ages birth to five who are in care. HBCC is particularly important for infants and toddlers, children from families with low incomes, and those living in rural areas. HBCC is an essential support for the California workforce, with many parents relying on this care so that they can go to work and support their families.

HBCC includes several types. These types differ in several respects, including as to whether the provider is paid, listed on a registry, and has a prior relationship with the children in care. Parents choose HBCC for various reasons, including availability, affordability, trust, and flexibility to accommodate non-traditional work schedules. Paid HBCC generates $1.4 billion in revenue in California annually, as well as spillover economic activity in other sectors. However, HBCC also faces several challenges, and the number of licensed child care homes has dropped 30 percent in recent years in California, contributing to the shortage of child care, particularly for infants. The current pandemic poses an additional, significant threat to HBCC and the entire child care industry. Given HBCC’s vital role in supporting our state’s workforce and economy, it is critical that California policymakers develop and enhance supports for home-based child care.

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  1. Child Care


  1. California