Blog | February 23, 2022

Addressing Child Care Challenges Key to South Dakota's Economic Recovery

A new report details the damage caused by a lack of access to affordable, quality child care for children under age 3

As South Dakota emerges from a devastating pandemic, a lack of child care for working parents is preventing the state’s economy from regaining its footing, negatively impacting businesses, families, and children in the process. That’s the top-line message of a just-released research report, Want to Strengthen South Dakota’s Economy? Fix the Child Care Crisis.

The report outlines the hefty child care challenges faced by South Dakota families as the state emerges from a pandemic and aims to grow its economy. ReadyNation released the report on Tuesday, February 22 via a virtual roundtable and discussion forum featuring Tom Johnson, President and CEO of Elevate Rapid City, and Nicole Weiss, Early Learning Director for the YMCA of Rapid City, and Dr. Sandra Bishop, Chief Research Officer for Council for a Strong America. Kate Schaefer, Senior Associate for ReadyNation, moderated the event.

Dr. Sandra Bishop opened the forum by sharing data from the new report, noting that South Dakota is home to approximately 36,000 children under age 3, and 78 percent of the mothers of these infants and toddlers work outside the home. The state has 223 licensed child care centers, 403 registered family child care homes, and 50 licensed group family child care homes. But nearly half (43 percent) of South Dakotans live in a child care “desert,” where there are more than three children under age 5 for each licensed child care slot. Typically, availability is especially limited for families who have infants and toddlers, work evening and night shifts, or live in rural areas.

Local business leaders agree that the child care crisis is having a significant impact on the state’s economy. “Low startup costs and a lack of corporate and individual income taxes give South Dakota a very business-friendly climate. Business owners benefit from no corporate income tax, no personal income tax, no personal property tax, and no business inventory tax,” said Tom Johnson. “But we face a number of challenges as well. We are hearing every day from business leaders who say they have jobs, but they can’t get workers. And we all know that one of the reasons why is because parents can’t find safe, quality child care.”

“The pandemic exposed the vulnerability of child care,” added Nicole Weiss. “And, even though it looks like we’re through the worst of it, the need for more quality affordable child care is urgent, and we need to make a commitment as a state and a nation to support that need.”

South Dakota families are also struggling with child care affordability: Infant care in a center in South Dakota averages $6,500 per year, not much less than public college tuition ($8,700). This high cost makes child care unaffordable for many families, particularly those with low incomes.

Quality of child care facilities is also an issue. Just 28 percent of South Dakota’s child care providers are licensed or registered, so the quality of care received by many children is unknown. South Dakota is currently developing a Quality Rating and Improvement System (QRIS), the Quality Framework. The draft plan includes requirements for provider training specific to infants and toddlers.

“The business leaders of ReadyNation South Dakota call on state and local policymakers to support families’ access to affordable, high-quality infant-and-toddler care,” the report states. “Businesses can play a role as well, through on-site child care, funding for employees or to child care providers, and advocating for sound child care policies. Effective, well-funded policy initiatives, as well as continuing innovations at the state and local levels, will yield a child care system that will support a more productive workforce and economy for South Dakota, both now and in the future.”

A recording of the event may be found below: