Johnson County program boosts wages for child care workers

  • A new Johnson County program will provide money to boost qualifying child care providers’ pay by $2 per hour.
  • A family with two children in child care in Johnson County pays, on average, $2,008 per month, one of the highest rates in the state.
  • The initiative will be funded by Johnson County, Iowa City and private businesses.
  • Similar wage enhancement programs in Polk and Hamilton counties have increased child care workers’ pay, which helps retain employees.

IOWA CITY — Amid a statewide child care crisis, a collaboration between Johnson County, Iowa City and businesses will increase wages for eligible child care workers by $2 per hour.

The wage enhancement program is intended to boost pay without raising the cost for families. The program’s other goals are attracting and retaining child care workers and promotion of the profession.

The program will be funded by $1.5 million in pandemic relief dollars from the two local governments, along with additional investment from area businesses.

Experts previously told The Gazette that businesses need to get involved to help solve the child care crisis, an issue that was exacerbated by the COVID-19 pandemic. Once businesses invest in child care, they stick with it because they see the benefits, such as bringing people back into the workforce.

Johnson County Supervisor Pat Heiden said it is significant to be discussing this program, and the pandemic relief dollars will “move the needle dramatically.” Supervisor Lisa Green-Douglass agreed, calling the program a “game changer.”

“We see this as a real opportunity to have an impact on our community,” Lynette Jacoby, the county’s social services director, told the Board of Supervisors Wednesday.

Cost and demand for child care

A Johnson County family earning the median income with an infant in child care spends14 percent of its income on child care, according to data presented by Jacoby. Affordable child care is classified as 7 percent of a family’s income.

Johnson County has some of the highest costs for child care in the state, Jacoby said. A family with two children pays an average of $2,008 every month — or $24,096 per year — on child care in the county.

“Affordable, quality child care is out of reach for many households in Johnson County,” Jacoby said.

The county contacted all 52 licensed centers to ask questions about capacity, filled slots, wait lists and staff impact, among other questions. A total of 42 centers responded.

The centers surveyed have a total wait list of 1,874 children. Five of the programs have wait lists of 100 or more.

The 42 centers — which do not include in-home providers — have a licensed capacity of 4,254. There are currently 2,949 filled slots. But the empty slots available can’t be filled due to staffing shortages, said Laurie Nash, the county’s youth and family service manager. There are 102 full-time staff openings, along with 66 part-time openings.

Experts previously told The Gazette the child care industry has struggled to remain competitive, especially with other businesses upping their wages and offering benefits.

The average child care worker in Johnson County is paid $11.16 per hour, which is the lowest for any tracked profession.

“Even though we have empty slots and kids on waiting lists, we can’t fill those slots because we don’t have the staff to do it,” Nash said.

Who will be eligible?

The wage enhancement program will be administered by Johnson County Social Services. The wage supplement will be paid in a lump sum to providers, which will then pay the eligible employees. To be eligible for the wage enhancement program, child care centers must be licensed and serve children age 5 or younger.

The hourly minimum wage paid to workers must be at least the county’s recommended minimum wage of $11.56 per hour.

The centers must participate in the state’s quality rating scale or maintain accreditation from the National Association for the Education of Young Children. Centers must also maintain a Child Care Assistance cap of at least 20 percent, which refers to the portion of a center’s capacity that’s reserved for families who receive state assistance.

Funding will be prioritized to centers that aren’t already subsidized through other federal or state means, Jacoby said.

Once centers qualify, the child care professionals within the center must consistently work at least 32 hours per week and be a year-round employee. The employee must work with children 5 or younger, earn less than $23 per hour and work directly with children. This does not include statewide preschool teachers.

“We think overall with the program, if an individual is working 35 hours per week, the $2 per hour boost would increase their wage just over $4,000 annually,” Jacoby said.

How will this be funded?

Johnson County is investing $250,000 per year for three years to fund the program. Iowa City agreed to match up the $250,000 a year, Jacoby said. Between the two local governments that’s a total investment of $1.5 million.

The county wants the program to be sustainable after the initial pandemic relief funds are gone, Jacoby said. This will be accomplished by partnering with the business community and asking it to invest $150 per year per employee to sponsor child care solutions.

Businesses are also able to make contributions directly to the fund through the Community Foundation of Johnson County. Better Together 2030 will serve as a liaison.

“We hope to continue to build that fund so within a few years it will be sustainable when the (federal American Rescue Plan Act) funds have been fully utilized,” Jacoby said.

Johnson County Social Services will work with providers to pay bonuses to new employees and to supplement wages of employees working within an approved center. 4Cs of Johnson County will work with the centers and in-home providers to educate them about the program.

Johnson County’s program is modeled after similar programs in Polk and Hamilton counties. Jacoby said the program in Hamilton County has been “really successful” with businesses recognizing the value of investing in child care.

In Hamilton County, a public-private partnership formed to create a retention and hiring bonus program for child care staff at four centers. The program was launched last year and is funded by contributions from businesses and local government.

Jacoby said the outreach is just starting for Johnson County’s program. Promotional materials are being developed, and the Iowa City Area Business Partnership has a website with information for the business community.

“It’s going to be a process to roll this out, and we’re prepared for that, for the long haul,” Jacoby said.

Comments: (319) 339-3155; [email protected]

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