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key takeaway

California has a significant unmet need for affordable child care, with only a fraction of eligible children receiving subsidized care. The state needs to make significant and sustainable investments in expanding subsidized child care options, particularly for infants and toddlers.

Affordable child care is critical for supporting California’s families to grow and thrive. Within California’s mixed delivery system, the California Department of Social Services (CDSS) provides child care programs at low- to no-cost for families with low incomes. For far too long, the demand for subsidized child care has outpaced supply. Specifically:

  • In 2015, 85% of children eligible for subsidized child care did not receive services.
  • In 2017, 89% of children eligible for subsidized child care did not receive services.

An analysis of 2022 data shows an unfortunate continuation of this trend, underscoring the need for a larger supply of subsidized child care spaces in California. 

Child Care and Development Transition

This analysis only includes child care programs within CDSS. The 2020-21 Budget Act transferred the child care and development programs from the California Department of Education (CDE) to CDSS. This transfer was intended to support a more integrated and coordinated system of care that could more effectively serve children, families, and the workforce. Thus, as of July 1, 2021, CDE only maintained oversight of two early learning programs: 1) The California State Preschool Program (CSPP); and 2) Transitional Kindergarten (TK) — both of which are now a part of CDE’s “Universal Pre-K” system. Previous Budget Center analyses of unmet need included CSPP. However, given the transition of programs from CDE to CDSS and related changes to eligibility requirements and other aspects of these programs, this analysis does not include CSPP. A forthcoming publication will explore eligibility and enrollment specific to CSPP. 

What is the unmet need for child care?

In 2022, only one in nine of California’s children eligible for child care actually received services. The number of children eligible for subsidized child care has grown from 1,479,000 in 2015 to 2,161,000 in 2022. While the number of new subsidized child care spaces has increased — notably, 146,000 new spaces were added since 2021-22 — the number of new slots has not kept pace with the growing demand. The chart below provides a visual of the unmet need for child care in California.

What are the implications of failing to meet California’s child care needs?

Families of color in California have historically been denied access to key services and opportunities. These inequities continue to negatively impact Californians of color as recent analyses have shown that poverty rates nearly doubled for Black and Latinx adults in California from 2021 to 2022. Moreover, Californians of color are more likely to struggle with paying for basic expenses.

The chart below shows that children of color are disproportionately eligible for subsidized child care. As the supply of subsidized child care continues to far outpace demand, families of color are most impacted by this insufficient supply. Therefore, the lack of subsidized child care continues to exacerbate the historical and unjust inequities that impact Californians of color.

CDSS’s child care and development programs serve ages zero to twelve. Within this age range, the cost of providing care is the highest for infants and toddlers; yet, providers that serve infants and toddlers typically make less money. Given this context, as well as the potential impacts of TK expansion on the mixed delivery system, there is concern around a diminishing supply of infant and toddler care options.

The chart below shows that across all age groups, only a fraction of those eligible for care are actually enrolled. However, children ages 0-2 are the only age group that is solely served by CDSS’s child care programs (other age groups have access to programs hosted by CDE). Thus, the unmet need for child care is particularly acute for infants and toddlers and failure to expand subsidized child care may disproportionately impact this age group. While school-age children have access to alternatives, it's important to note that the unmet needs stretch beyond infants and toddlers.

How can policymakers address the unmet need for child care?

While the supply of subsidized child care has increased since the dramatic cuts made during the Great Recession, California is still a long ways away from meeting families’ child care needs. Specifically, to help address the unmet need for child care, the 2021-22 enacted budget set a goal of adding 200,000 new child care slots. While 146,000 of these slots have been funded, slot expansion has been delayed for the last two fiscal years. The governor maintains his commitment to fund all 200,000 slots by 2026-27; however, the timeline for funding the remaining 54,000 slots by the deadline remains unclear.

The administration can increase the number of new slots in the 2024-25 budget to make immediate and needed progress on addressing the unmet need for child care. The unmet need for child care in California is an issue that requires state leaders' attention regardless of the cyclical ups and downs of the state budget. State leaders should make significant and sustainable investments in increasing access to affordable child care that meets families’ needs. Failure to do so keeps thousands of families — mainly families of color — on child care waiting lists, hampering their economic mobility and ability to find nurturing care for their children.

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