Table 3. Mothers, 21 to 29 years old, who cited child-care problems, by poverty status,
total number of children, and age of youngest child, 1986
At or below the poverty line ‘Above poverty line
Number of children and Asa percent of ail As a percent of all
itd Number Number
‘ee ofyoungert tthousanaey | Meera gOL | housende) | iabortaree

Total number of children
One... 105 29.5 196 16.4
Two... 164 35.2 202 17.8
Three or more : 145 36.5 it 25.6

Age of youngest child
Less than 1 year old . 87 40.5 63 10.6
1-2 years old ......... 185 37.9 240 228
3:5 years old .......... 103 33.0 174 206
6 years or older... 39 19.4 32 12.0

10 were out of the labor force for all of 1986 and
almost 6 of 10 were poor.

The proportion of poor mothers citing child-
care problems was almost twice as high as among
their nonpoor counterparts. In part, the differ-
ence is attributable to the fact that poor mothers
tended to have more children than other moth-
ers. As the following tabulation shows, one-
third of all poor mothers who were out of the
labor force had three or more children, com-
pared with about half that proportion for their
tonpoor counterparts.

Poor Nonpoor

Total number of children . - 100.0 100.0
lto2 .... 67.5 84.3,
3 or more . 32.5 15.7

Even among women who had one or two
children, however, poor mothers were much
more likely to be out of the labor force due to
child-care problems, as the figures in table 3
illustrate. Similarly, poor mothers whose young-
est children were less than 3 years of age were
also more likely than their nonpoor counterparts
to report child-care problems as the reason for
their absence from the job market.'* Child care
for this age group is very limited in poor neigh-
borhoods.’”

Child-care expenditures

As we have seen, poor mothers were much more
likely than other mothers to be out of the labor
force due to child-care problems. The cost of
child care is probably a major factor behind this
differential. When people say they have a prob-
lem finding reliable child care, they may mean
they have a problem finding quality care at a
price they are willing or able to pay. Poor moth-
ers are often unable to pay for the child care in

order to look for work. They often have lower
levels of marketable skills and frequently do not
have good chances of getting jobs that pay enough
to permit payment for child care; many of these
mothers may be too discouraged about their job
prospects to seek employment.'*

Data from the Youth Survey provide an indi-
cation of how difficult it is for poor families to
pay for child care. A question in the 1986 round
asked respondents about the amount they spent
per week on child care. The following figures are
the means of selected variables and are based on
a subsample of mothers who paid for child care,
had been employed in 1986, and were never out
of the labor force because of child-care prob-
{fems.'* Only a minority of poor mothers paid for
child care.

Poor Nonpoor
Weekly child-care costs . $30 $ 40
Weekly family income . 132 629
Child-care costs as a percent
of weekly income ...........+ 263 8.2

As is evident from these numbers, weekly
child-care expenditures of poor mothers com-
prised, on average, more than a quarter of their
weekly family income. This represents a sub-
stantial proportion of limited funds. Compared
with their counterparts, poor mothers faced a
much more restricted range of child-care options
because far fewer of them could realistically
consider paying for child care.”

MOST STUDIES OF CHILD-CARE issues have fo-
cused on the needs of employed parents. This
might seem to suggest that parents who are not
employed do not have child-care problems. As
recent data from the Youth Survey show, how-
ever, many young mothers who were not em-
ployed reported that difficulty obtaining child

Monthly Labor Review October 1991 7


Child-Care Problems

being out of the labor force had such weak
attachment to the work force. In other words,
women with child-care problems were more
likely than other women to be out of the labor
force for all of 1986."

Incidence among population subgroups. Not
surprisingly, child-care problems were more
prevalent among women caring for 3 or more
children and for those with very young children.
Table 2 shows that, of the women who were not
employed with three or more children, almost
one-third reported being out of the labor force
because of child-care problems; this was one-
and-a-half times the rate for women with one
child. Similarly, among women out of the labor
force whose youngest children were between the
ages of 1 and 5 (preschoolers), the likelihood of
being out of the labor force because of child-care
problems was about twice that if the youngest

children were of school age (6 or older). A large
proportion of mothers with infants less than a
year old reported that pregnancy was the main
reason they had not looked for work; in contrast,
pregnancy was only rarely cited by mothers who
had older children. This helps explain why a
comparatively small proportion of mothers with
the youngest infants reported child-care prob-
lems.

Minority mothers—particularly Hispanics—
were more likely to be out of the labor force
because of child-care problems'* than mothers
who were poor and lacked high school diplomas.
(See table 2.) Among mothers who did not have
high school diplomas and were out of the labor
force, one-third cited child-care problems as the
primary reason for their status. Mothers without
high school diplomas who were out of the labor
force because of child-care problems tended to
have serious labor market difficulties. Seven of

Table 2. Mothers, 21 to 29 years old, not in the labor force, by selected
characteristics, 1986
Mothers not in the labor force because
Total, all mothers of child-care problems
not In the
Selected characteristics labor force Number Aa a percent of ai
thousands} mothers not in the
( i) (thousands) labor force
Total. 4,726 1,109 23.5
Age
21-24 years old . 1,472 356 24.2
25-29 years old . noes 3,254 753 23.1
Race or Hispanic origin’
Hispanic origin 66.00... eee eee 433 176 40.6
Black .. : 860 250 29.0
White vee bett eee eee 3,433 683 19.9
Age of youngest child
Less than 1 year old 981 71 17.4
1-2 years old 1,807 509 28.2
3-5 years old . 1,362 351 25.8
6 years or older 576 78 13.5
Total number of children
One... 1,854 376 20.3
Two... 1,912 428 22.4
Three or more ee 961 305 31.8
Poverty status?
At or below poverty line 1,217 44 34.0
Above poverty line........... 2,763 509 18.4
Marital status
Single parent ween 1,532 464 30.3
Married, spouse present 3.194 645 20.2
Educational attainment?
No high school diploma 1,157 372 32.2
High schoo! graduate 3,547 727 20.5
‘In this research, the groups—Hispanic origin, blacks, and whites—are treated as mutually exclusive categories.
® Data refer to persons who provided complete information regarding family income.
* Data reter to persons who provided complete information regarding educational attainment.

6 Monthly Labor Review October 1991


Child-Care Problems

care was the major reason they were unable to
enter the labor force. This was especially true for
poor mothers. Paying for child care was not a
realistic long-term option for most poor moth-
ers, and this restricted the child care available to
them. This implies a “catch-22” situation: with-
out child care, they could not look for work, and

Footnotes

without work they could not pay for child care.
Itis also true that many mothers who were out of
the labor force because of child care problems
did not have high school diplomas. For these
young women, child-care problems were just
one of the serious disadvantages they faced in
the labor market. oO

' Data from the Current Population Survey show that in
1990, the labor force participation rate for mothers with
children less than 3 years old was 53.6 percent. A little more
than half of all children who were less than 6 years old had
mothers who were in the labor force in 1988.

2 For a summary of child-care trends, see Child Care:
A Workforce Issue, Report of the Secretary of Labor's Task
Force (U.S. Department of Labor, April 1988); Sandra
Hofferth and Deborah Phillips, “Child care in the United
States, 1970 to 1995," Journal of Marriage and the Family,
August 1987, pp. 559-71; and Donald J. Hernandez and
David Myers, “Family composition, parents’ work, and the
need for child care among preschool children: 1940-1987,"
paper presented at the Population Association of America
meetings, New Orleans, April 21-23, 1988.

Legislation concerning child-care policy and earned
income tax credit was enacted in the Omnibus Budget
Reconciliation Act of 1990, P.L. 101-508. The child-care
package contained in the Reconciliation Act includes an
expansion of the earned income tax credit, the Child Care
and Development Block Grant, a new “wee-tots” tax credit,
child health insurance credit, and a family support (Title
IV) grant.

* Some examples of child-care research that has fo-
cused on employed parents include Greg J. Duncan and
Saul D. Hoffman, “Child care arrangements and fertility:
an analysis of two-earner households,” Demography. No-
vember 1985, pp. 499-514; Who's minding the kids? Child
care arrangements, Current Population Reports, Series P-
70 (Bureau of the Census, July 1990); and Harriet Presser,
“Shift work and child care among young dual-earner Ameri
can parents.” Journal of Marriage and the Family, Febru-
ary 1988, pp. 133-48.

* See Child Care: A Workforce Issue; and Douglas
Besharov, “The politics of day-care,” The Washington
Post, Aug. 21, 1988, p. C5.

* David Blau and Philip Robins, “Child care costs and
family labor supply,” Review of Economics and Statistics,”
August 1988, pp. 374-81; David Blau and Philip Robins,
“Fertility, employment and child-care costs," Demography,
May 1989; Rachel Connelly, “The effect of child care costs
on married women's labor force participation,” Survey of
Income and Program Participation Working Paper 8918
(Bureau of the Census, July 1989); and Rachel Connelly,
“The importance of child care costs to women’s decision
making,” paper presented at the Carolina Public Policy
Conference on the Economics of Child Care, University of
North Carolina, May 16, 1990. These studies build on
pioneering work by James Heckman, “Effects of child-care
Programs on women’s work effort,” Journal of Political
Economy, March/April 1974 (Supplement).

7 See Blau and Robins, “Child care costs and family
labor supply.”

* See Connelly, “The effect of child care costs on
married women's labor force participation,” and “The im-
portance of child care costs to women's decision making.”

8 Monthly Labor Review October 1991

* Of nonemployed mothers in the 1977 Current Popu-
lation Survey, 17 percent said they would look for work if
child care were available at a reasonable cost, compared
with 13 from the 1982 survey. See Harriet Presser and
Wendy Baldwin, “Child care as a constraint on employ-
ment: prevalence, correlates, and bearing on the work and
fertility nexus," American Journal of Sociology, May 1980;
and Martin O'Connell and David Bloom, “Juggling Jobs
and Babies: America’s Child Care Challenge,” Population
Trends and Public Policy, February 1987. Similar percent-
ages were obtained in response to similar questions in other
surveys. See Katherine Dickinson, “Child care,” in Greg
Duncan and James Morgan, Five Thousand American Fami-
lies—Patterns of Economic Progress (Ann Arbor, Survey
Research Center, University of Michigan, 1975), vol. 3, ch.
6, pp. 221-56; and Karen Oppenheim Mason, “The per-
ceived impact of child care costs on women’s labor supply
and fertility,” Research Report, Series 87-110 (Ann Arbor,
Population Studies Center, University of Michigan, June
1987).

" Harriet B. Presser and Wendy Baldwin, “Child care
as a constraint on employment,” p. 1205.

"Data concerning start and stop dates of job search are
not provided in the Youth Survey. While this information
is necessary for determining whether respondents were out
of the labor force at any time during 1986, in practice,
identifying start and stop dates of job searches is problem-
atic, both for survey interviewers and for job searchers. In
contrast, periods when employment started and stopped
can be identified more precisely, and the Youth Survey
provides this information. On this basis, it is possible to
identify mothers who had periods of nonemployment in
1986, determine who was out of the labor force during each
period, and examine their reasons for being out of the labor
force. This study assumes that, for all respondents who
experienced nonemployment in 1986, their time out of the
labor force also included 1986. This assumption might be
wrong for some respondents, those for whom non-
employment in 1986 was part of an uninterrupted period of
nonemployment that covered one ot more contiguous years.
For this group, it is conceivable that some were out of the
labor force during an adjacent year, but looked for work
continuously throughout their period of nonemployment in
1986. The data do not allow one to determine how many
respondents fit this description, but it is reasonable to
assume they were few.

" Interviewers coded the answers according to prede-
termined categories. Responses that were ambiguous were
recorded verbatim and were coded later. Many of these
ambiguous answers were coded as “Other.” To be coded as
“Child care problems,” a respondents answer had to be
quite precise and include an indication that she wanted to
work, but was prevented from doing so because she could
not locate or afford adequate child care. Despite this pre-
caution, answers given by some respondents were probably
misinterpreted and misclassified; there is no way of know-
ing how many. In particular, the distinction between “per-
sonal/family reasons” and “child care problems” was prob-
ably difficult to make in some instances.



Peter Cattan

Peter Cattan is an
economist in the Office of
Employment and
Unemployment Statistics,
Bureau of Labor Statistics.

Child-care problems:
an obstacle to work

The lack of affordable, quality child care

was the reason an estimated 1.1 million young mothers
did not seek or hold a job in 1986, according to data
from the National Longitudinal Survey of Youth

ver the past 3 decades, millions of
O women with children entered the Ameri-

can labor force, changing family life
in fundamental ways. Now only | of 3 mothers
stays at home and provides full-time care for her
children, and even mothers of very young chil-
dren are likely to be in the labor force. Indeed,
about half of all preschoolers spends at least part
of the day in the care of adults other than their
parents.!

Growth in the number of day care centers and
other forms of nonparental care for children has
accompanied this increase in working mothers.”
But for many families, finding affordable, qual-
ity child care can be a problem. Good care with
persons other than relatives is often difficult to
find or is too expensive, especially for families
with low incomes. Relatives and friends are not
always able to help out, especially if they do not
live nearby or if they are in the labor force
themselves. For poor mothers, lack of child care
can be a particularly serious obstacle in obtain-
ing and holding a job, compounding the eco-
nomic disadvantages they often face because of
inadequate training, educational attainment, and
work experience. These factors can prolong
parents’ spells of joblessness, preclude sustained
employment, or effectively bar them from jobs
that pay higher salaries.

For many years, interest groups have lobbied
the Federal Government for legislation that
would provide increased assistance to parents
with child-care needs. In 1990, after considering
more than 100 bills with child-care components,

the 101st Congress enacted legislation intended
to make child care affordable for more parents.*
Parts of the new legislation target poor, single
parents who are not employed, providing them
with temporary child-care assistance during pe-
tiods of subsidized job training and during tran-
sitional periods after such training. This legisla-
tion recognizes that the lack of affordable child
care is a serious barrier to the labor force partici-
pation of many parents, especially those who are
poor.

There have been only a few studies which
focus on mothers who are kept out of the labor
force by child-care problems, and their situation
is only beginning to receive more analysis. This
article briefly reviews past research and presents
newly available data on the extent to which
young mothers report being out of the labor force
because they cannot arrange for child care.

Past studies

Most child-care research conducted in recent
years has concentrated on the child-care needs of
parents who are employed.* Some analysts have
suggested that parents who are not employed are
unlikely to need child care, or that the high labor
force participation rate of women with pre-
schoolers and its rapid rise in recent years indi-
cate that women who need child care have had
relatively little difficulty obtaining it.’ These
views fail to recognize that the lack of affordable
child care can be a major obstacle, preventing
mothers of young children from seeking or hold-

Monthly Labor Review October 1991 3


© This proportion is much higher than that found in
early studies (see footnote 9). However, the results are not
comparable because of differences in how samples were
defined, how interview questions were formulated, and the
reference periods of the studies. It is likely that the propor-
tion derived from the Youth Survey is higher because
Youth Survey respondents are younger (and therefore had
younger children and greater child-care responsibilities
than mothers in other samples) and because these Youth
Survey data cover all of 1986 rather than one point in time
(mothers are more likely to have time out of the labor force
due to child-care problems over the course of a year than
during a given week)

“4 All statements of comparison in this article are sig-
nificant at the .10 level or better. Standard errors for all
estimates are available from the author on request.

'SIn this research, Hispanics, blacks, and whites are
treated as belonging to mutually exclusive categor

'* Differences in nonparticipation rates between poor
and nonpoor mothers were not significant at the .10 level
for mothers with three or more children and for mothers
whose youngest children were 3 years of age or older.

" Rebecca Maynard, Ellen Eliason Kisker, and Stuart
Kerachsky, Child Care Challenges for Low-Income Fami-
lies (New York, Rockefeller Foundation’s “Into the Work-
ing World” series, 1990).

' As Sonenstein and Wolf note, “A factor affecting a
mother’s entrance into the work force may be the wages she
can earn relative to what she must pay for child care
... Poorly educated women with little work experience
make low wages, and unless they find subsidized, afford-

able or free child care, employment may not make eco-
nomic sense to them.” See Freya L. Sonenstein and Dou-
glas A. Wolf, “Caring for the children of welfare mothers,”
paper presented at the meeting of the Population Associa-
tion of America, New Orleans, April 21-23, 1988.

' It was redundant to exclude mothers who were out of
the labor force because of child-care problems; virtually no
mother who was out of the labor force because of child-care
problems paid for child care

The weekly income figures reported here come from
estimates of each respondent’s annual household income—
the sum of the earnings of all household members for 1986
and all other sources of income for the calendar year. To
estimate weekly income (in the tabulations presented here)
income was divided by 52. Figures for child-care expendi
tures as a percentage of incomes were calculated for each
respondent in the subsample as defined in the text. Re-
ported here are the means of these percentages.

2 The findings presented, in this article, of child-care
expenditures as a percentage of income by poverty status
are similar to those of other researchers: Hofferth, who used
similar data in the 1985 National Longitudinal Survey of
Youth; Maynard, Kisker, and Kerachsky, who used data for
three major urban areas; and O'Connell, who used data on
respondents to the Survey of Income and Program Partici-
pation (stPP) who were employed during a 3-month period
prior to the fall 1987 interview. See Sandra L. Hofferth,
“Statement on child care in the U.S.,” delivered before the
Select Committee on Children, Youth, and Families, July 1,
1987; Rebecca Maynard, Ellen Kisker, and Stuart Ker-
achsky, Child Care Challenges for Low-Income Families;
and U.S. Bureau of the Census, Who's minding the kids?

Monthly Labor Review October 1991 9


Child-Care Problems

ing employment. Investigating the scope of this
problem has been difficult because there are
scarce recent data on the reasons that mothers
are out of the labor force.

A few studies have examined the issue of
affordability in detail, deriving estimates to de-
termine how important child-care costs are rela-
tive to demographic and socioeconomic factors
in keeping mothers out of the labor force. This
research suggests that potential child care costs
are a deterrent to labor force participation. The
magnitude of this effect varies, depending on the
population sampled and the methodology used
to estimate child-care costs.

Because mothers who are out of the labor
force typically do not pay for child care, some
assumptions must be made to determine what
they would have to pay if they were to enter the
labor force. Using data on married women in the
Employment Opportunity Pilot Project for 1980,
David Blau and Philip Robins assigned each
family the average cost of child care (per child)
in the area where each family lived. The assump-
tion behind this indicator was that families liv-
ing in the same area face the same cost of child
care. Blau and Robins found that the costs of
child care were inversely related to the employ-
ment of married mothers.’ They estimated that if

National Longitudinal Survey of Youth

The National Longitudinal Survey of Youth (Youth Survey) was
designed to represent the population of youth born between 1957 and
1964. Three independent probability samples were drawn for the
Youth Survey: (1) a cross-sectional sample designed to be represen-
tative of the noninstitutionalized civilian segment of American young
people 14 to 21 years old as of January 1, 1979; (2) a supplemental
sample designed to reach a given number of Hispanic, black, and
economically disadvantaged non-Hispanic, nonblack youth; and (3)
amilitary sample. Interviews were conducted each year beginning in
1979, at which time there was a total of 12,686 respondents. The
research summarized in this report involved linking data from two
recent Youth Survey interviews (the eighth round in 1986 and ninth
round in 1987) and selecting pertinent information which covered the
1986 calendar year. Data from each interview year contain a weight
specific to that year. When this weight is applied, the number of
sample cases is translated into the number of persons in the population
which that observation represents.

The population subgroups used in this report were derived by
selecting all women, 21 to 29 years of age, with children in 1986. In
unweighted terms, this yielded slightly more than 3,000 respondents,
about | percent of whom had to be dropped from the sample because
of incorrect or missing data on children’s ages and mothers’ labor
force experience. Of the 3,000 women with children, 1,787 spent
time out of the labor force during their period out of employ-
ment in 1986 and 507 spent time out of the labor force because
of child-care problems.

4 Monthly Labor Review October 199]

child care had been free for all married mothers,
87 percent of them would have been working in
1980. By contrast, if the price of child care had
been $40 per week—~higher than the average in
1980—they estimated that only 19 percent of
married mothers would have been working.

Using a different approach, Rachel Connelly
analyzed data on the actual child-care expendi-
tures of working mothers in the 1984 and 1985
panels of the Survey of Income and Program
Participation. From these data, she assigned es-
timates of child-care costs to all families, includ-
ing mothers who were not working. For unmar-
ried mothers, Connelly found that child-care
costs had a substantial effect on labor force
participation. For married mothers, Connelly
concluded that higher child-care costs also re-
duced the likelihood of labor force participation,
but less dramatically than Blau and Robins found.
If child care were free, Connelly estimated that
61 percent of married mothers would have been
working.*

Rather than estimating the effect of child-
care costs on labor force participation, other
studies have taken a more direct approach, using
supplements to the Current Population Surveys
of 1977 and 1982, which asked nonem-
ployed mothers whether they would work “if
satisfactory child care were available at reason-
able cost.” Substantial portions answered affir-
matively, especially among mothers who were
single, poor, or lacked a high school diploma.’ A
limitation of these interviews is that posing hy-
pothetical questions might have encouraged re-
spondents to “overestimate their readiness to
seek employment.” An alternative approach,
one which asks mothers an open-ended question
as to why they are not looking for work, is more
likely to give respondents the freedom to express
their own reasons. This approach is used in the
following analysis.

Data

The data for this report focus on young mothers
out of the labor force and are derived from the
National Longitudinal Survey of Youth (or Youth
Survey), an ongoing sample of persons in the
United States who, in 1986, were 21 to 29 years
old. A subsample of respondents from the Youth
Survey was selected for use in this study. It
consisted of mothers who neither worked nor
looked for work for at least part of 1986 (that is,
they were out of the labor force for part of the
year).'' For each period out of employment, the
respondent was asked whether she spent the
entire time looking for work. If she spent any
time not looking for work, she was asked the
open-ended question, “What would you say was



Table 1. Distribution of mothers 21 to
29 years oid, by selected
categories of labor force
experience and extent of
employment in 1986

Number

Labor force experiance |nousands)| Percent
-—

Total........ . | 8,232 100.0

With time out of the

Jabor force ........... 4,726 57.4

Never employed in 1986. | 2,245 27.3
Did not look for work
because of:
Child-care problems 726 88
Other reasons .. . 1,519 18.5
Employed tor part
of 1986.2... 2,481 30.2
Did not look for work
because of:
Chitd-care problems 383 47
Other reasons .... 2,098 25.5
In the labor force
continuously ........... | 3,506 42.6
Never employed
in 1986... 13 2
Employed for part
of 1986 ... 7 379 46
Employed continuously .. | 3,114 378

the main reason that you were not looking for
work during that period?” The answers were
coded into the following categories:

Did not want to work

Ill, disabled, unable to work
School was not in session for this period
Armed Forces

Pregnancy

Child-care problems
Personal/family reasons
Vacation

Labor dispute/strike
Believed no work available
Could not find work

In school

Other

eoeceeseveeenesn

These answers made it possible to estimate
the number of young mothers who thought of
themselves as being out of the labor force be-
cause of child-care problems.’ It is, of course,
impossible to determine from these data how
many mothers who cited child-care problems
would have looked for work if satisfactory child
care had been accessible and affordable. These
responses are important, however, because they
reflect these mothers’ own interpretations of
their situation. (See box for more information on
the Youth Survey and how data for this research
were derived.)

Frequency of child-care problems

Overview. An estimated 1.1 million mothers
in the 21 to 29 age group said they were out of the
labor force because of child-care problems in
1986. They represented almost 14 percent of the
total population of mothers 21 to 29 years old
(chart 1) and accounted for 23 percent of those
who were out of the labor force in that year."

While the focus of this study is on mothers
with time out of the labor force, it is important to
reaffirm that despite this finding, the labor force
attachment of young mothers was strong. As
table 1 shows, most were employed for all or part
of 1986.

Mothers reporting child-care problems had
very often not worked at all in 1986. In fact, as
the following tabulation shows, two-thirds of
them were never employed during the year:

Child-care Other
problems reasons

Total . . 100.0 100.0
Employed for part
Of 1986... 2. .e eee 34.5 58.0
Never employed
im 1986 2... cece 65.5 42.0

In contrast, only about 40 percent of their
counterparts who identified other reasons for

T Chart 1. Percent distribution of mothers
21 to 29 years old by selected
categories of labor force
experience in 1986

|

|

‘Mothers. with time out of thé labor force
‘With. child care.
problems:
Other raasons.

_

Monthly Labor Review October 1991 5