Report | July 20, 2023

The Growing, Annual Cost of the Infant-Toddler Child Care Crisis in South Dakota

Impact on families, businesses, and taxpayers could cost the state $329 million each year

South Dakota working parents know how difficult it is to find child care that’s accessible, affordable, and high-quality. This problem is particularly acute for parents of very young children, as infant and toddler care is typically the least available and most expensive. Further, children under age 3 are experiencing one of the most crucial periods of brain development. South Dakota employers know the economic impact of these child care challenges, that will only worsen as the child care crisis continues.

ReadyNation’s new national study found that America’s infant-toddler child care crisis now costs the nation $122 billion in lost earnings, productivity, and revenue every year. This staggering economic toll impacts working parents, their employers, and the nation’s taxpayers. Our 2018 study found that the crisis was already severely damaging the economy, exacting a cost of $57 billion annually. The crisis is now significantly worse.

South Dakota’s Gross Domestic Product (GDP) represents roughly 0.3 percent of the nation’s GDP. That suggests that the lack of reliable child care for working parents of young children, up to age 3, could come to an estimated $329 million in annual costs for South Dakota.

Beyond its impact on the workforce and economy today, the infant-toddler child care crisis damages the future workforce by depriving children of safe, healthy, educational environments that support brain development while their parents work.

As our data from the past four years shows, a failure to strengthen the country’s fragile child care infrastructure will lead to more and more economic damage to employers, workers, and taxpayers. State and federal policymakers must support evidence-based policies and programs that enhance the availability and affordability of high-quality child care. In particular, South Dakota policymakers must promote health and safety in child care settings and support the child care workforce. With wise investments, policymakers can improve life outcomes for thousands of South Dakota children today and strengthen our state’s workforce and economy both now and in the years to come.

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  1. Child Care
  2. Early Learning