There has never been a better time in history to be an Ohioan. We have an abundance of resources and variables working in our favor, including a low cost of living and a high quality of life. Our gross domestic product is the seventh largest in the United States, and if Ohio were a separate country, it would be the 21st largest economy. We are now entering a manufacturing renaissance unlike anything witnessed by any other state, and with the kind of economic wins we’ve seen just in the last two years, the best is yet to come.
While there is much to be proud of in Ohio, the state and its policymakers must also focus on laying the foundation for continued investment and creating economic growth. When we canvass our members on their greatest challenges, the universal response continues to be workforce. We recognize that to have a qualified, reliable and thriving base of employees, any discussion of workforce must also include access to transportation, affordable housing and perhaps the single biggest throttle to employment entry or re-entry, childcare.
To assist with this effort, the Ohio Chamber published our Blueprint for Ohio’s Economic Future, a constructive look at policy areas where Ohio can better capitalize on opportunities and position itself as a leader. That document revealed several worrisome statistics, beginning with Ohio’s average childcare costs being more costly than rent, with the ratio of childcare to rent at 103%. This places our state as one of the worst in the nation in terms of cost. When doing the math, it’s no wonder that many parents opt not to return to the workforce.
This cost problem is exacerbated by the limited availability of childcare options. Thirty-nine percent of overall Ohioans live in a childcare desert, which is a census tract containing more than 50 children under age 5 where no childcare providers are available, or any tract with more than three times as many children as childcare slots.
The problems with childcare access and affordability are holding back individuals from returning post-pandemic to Ohio’s workforce. Given both the existing statewide job openings and the tens of thousands of jobs in the pipeline, our state has a window of opportunity and necessity to address these barriers.
This problem has not fallen entirely on deaf ears, as the Ohio General Assembly has twice raised the Federal Poverty Level (FPL) for publicly funded childcare over the past two budget cycles from 130% to 142% in 2021, and recently to 145% in 2023. While the increases sound encouraging and allow for more working families to utilize childcare services, among all states, Ohio remains second to last in FPL threshold.
While expanding the eligibility helps Ohio’s employee base, the Ohio Chamber has cautioned that an access bottleneck exists, as we lack a corresponding increase in providers. Combating this phenomenon will involve increasing staff at childcare facilities. For example, to attract personnel, Children’s Discovery Center, a public and private childcare provider with six Ohio locations, provides a 60% childcare subsidy to employees. Additionally, in the recent state budget, the legislature appropriated $15 million for an Infant and Toddler Infrastructure Grant Program, which has already helped expand programming and create 2,000 new openings.
When it comes to increasing capacity, many best practices exist both inside and beyond Ohio’s borders. In Ashland County, a public/private collaborative known as the Women’s Fund Childcare Initiative is expanding access to high-quality, affordable childcare in that community. A newly formed nonprofit will own and operate the planned center, which will offer both income-based and employer-supported tuition assistance, as well as grant funding and endowment to ensure ongoing affordability and sustainability.
Not all of Ohio’s childcare capacity issues will be solved by constructing centers, however. In rural Ohio particularly, these needs may be best met by stimulating the creation of more in-home providers. One company making great progress in this vein is Wonderschool, which has worked with entrepreneurs, businesses, and governments across the US to develop or serve nearly 40,000 childcare programs. In Ohio, we can use companies like this to harness the potential of our parents, educators and retirees, walk them through the licensing process, retrofit their homes and navigate our state’s provider requirements to increase capacity.
With childcare remaining a pervasive workforce challenge, Ohio’s solutions must be three-dimensional, sustainable and elastic over time. This effort will take many complex conversations among policymakers, business leaders and families about provider regulations and how best to incentivize people to enter the caregiver profession and keep them in service. It’s no longer a discussion about luring companies to Ohio or improving quality of life; the existing need is pronounced, and we must create new trajectories to accommodate the dramatic economic growth arriving in just a few years.
Steve Stivers in the president and CEO of the Ohio Chamber of Commerce.
