As White House officials weigh potential financial incentives to encourage childbirth—such as a proposed $5,000 “baby bonus”—experts say soaring child care costs may be causing many families to reconsider having children.
According to the latest annual report from Child Care Aware of America, released Wednesday, the cost of child care has surged by 29% between 2020 and 2024. At the same time, the U.S. Centers for Disease Control and Prevention (CDC) reports that the nation’s fertility rate remains near historic lows. In 2024, there were 54.6 births per 1,000 women of reproductive age, a slight increase of less than 1% from the 2023 record low, but still significantly below previous years.
A U.S. government agency noted earlier this year that declining birth rates may be partially driven by escalating expenses related to both health care and child care.
“Although research offers varying conclusions, rising costs could be a factor in the nation’s declining birth rates,” noted a March brief from the U.S. Department of Health and Human Services. “Between 2010 and 2023, the annual birth rate dropped by 17%, falling from nearly 13 births to under 11 births per 1,000 people.”
Christine Davis, a 37-year-old single mother and private investigator from Connecticut, the financial and logistical burden of child care is becoming a major concern as she prepares to return to work after her maternity leave wraps up this summer.
To manage in the short term, she plans to rely on a rotating group of family members to care for her 11-week-old son until he begins part-time day care in August—a service she says will cost over $200 for just two days a week.
Davis said she feels fortunate to have the support of her family. “That was something I seriously considered before deciding to have a child,” she told CNN.
Stephanie O’Sullivan, 43, a clinical mental health practitioner and mother of two, is relieved to have moved past the early years of paying for child care—costs she says once felt like taking on a second mortgage. Her youngest child is now 8, but she knows the need for child care doesn’t end when children start school.
What do families do during summer or school breaks?” she told CNN. And because I own my own business, I don’t get paid time off—if I’m not working, I’m not earning.”
Sending her daughter to camp is a major financial burden, she added. “It’s extremely stressful and expensive. And sometimes it feels like society is sending women the message: ‘Maybe you shouldn’t be working.’ But I’m the primary earner in my household.”
Child Care Costs Outpacing Inflation
According to the latest analysis from Child Care Aware of America, child care expenses have risen 29% between 2020 and 2024—surpassing the overall inflation rate of 22% during the same period. In 2024, the average annual cost of child care nationwide reached $13,128.
That figure now consumes 35% of a single parent’s median household income, up from 32% the year before. This far exceeds the U.S.
Care.com is an online platform that connects families with child care, senior care, and other caregiving services, while also helping caregivers find employment. Jamele represents the interests of the company’s users by advocating on Capitol Hill for families and parents nationwide.
Jamele has recently concentrated his advocacy efforts on tax policy. “When you really examine the situation facing working parents and families in this country, tax policy is virtually the only tool they have to lower the cost of care and improve access,” he told CNN.
“There’s broad agreement—on both sides of the aisle—that the rising cost of care needs to be addressed,” he added.
Currently, much of the policy conversation in Washington is centered on the Child Tax Credit. “There’s been relatively bipartisan support around it, and we’ve been actively pushing for its expansion and enhancement,” Jamele said. Originally increased and made more refundable by the Tax Cuts and Jobs Act of 2017, the Child Tax Credit is set to revert to earlier levels at the end of 2025 unless Congress acts.
Child Care: A Supply and Demand Imbalance
“There’s enormous demand for care, but not nearly enough supply to meet it,” he said.
However, there are signs of improvement. Child Care Aware of America’s latest report noted that both the number of licensed child care centers and in-home family care providers increased between 2023 and 2024—a continuation of steady growth since 2020.
Jamele emphasized the need for a comprehensive approach to improve the child care industry. “It’s about expanding and professionalizing the workforce, tackling everyday operational challenges that centers face, and easing the burdens they carry,” he said. “But just as important is ensuring parents can afford quality care without drowning in debt or paying more than college tuition, which is the case in many states.”
According to the latest report from Child Care Aware of America, in 41 states and Washington, D.C., the average yearly cost of infant care at a center exceeds the price of in-state college tuition—sometimes by just under 1%, and in some cases by more than double.
Jamele pointed out that the issue goes beyond a simple divide between parents and child care providers. “Parents overwhelmingly believe caregivers deserve higher pay,” he noted. “That’s why we need solutions that not only reduce the financial burden on families but also protect the wages of skilled professionals working in child care.”
Currently, the average annual salary for child care workers in U.S. centers is $33,140, the report said.
That disconnect between high child care prices and low wages is something that Christine Davis has also noticed. “You wonder how teachers make so little when child care costs so much,” she said. “It doesn’t add up.”
The Trump administration has acknowledged the financial strain on American families. A presidential memorandum issued in January was cited as a step toward exploring strategies to reduce care costs.
Jamele stressed that real progress requires a collaborative effort and significant policy reform. “This isn’t a problem that can be solved in isolation,” he said. “We need involvement from the government, employers, and the child care sector itself. The solution must be well-planned and comprehensive.”
“Supporting child care means supporting families,” he added. “It’s not just family policy—it’s economic policy, and it’s essential to our nation’s future and the well-being of the next generation.”