The Price of Daycare

The New York Times ran a thought-provoking column on Tuesday by David Leonhardt titled

The New York Times ran a thought-provoking column on Tuesday by David Leonhardt titled "The Price of Daycare Can Be High." It ran in the business section, and it's a must read for working parents. Leonhardt writes about a bold social experiment in Quebec: in 1997 the provincial government decided that it needed more women in the workforce to fuel economic growth. To get them there it started government run daycare centers that cost only $7 a day. The centers were flooded with applications, the number of children in daycare rose almost 50% and the mothers who returned to work in droves did give the economy a lift.

Almost a decade later three economists, two Canadians and one from MIT, decided to take an in-depth look at what it meant for the children. Their dismal conclusion:

"Across almost everything we looked at," said MIT professor Jonathan Gruber, "the policy led to much worse outcomes for kids."

"Young children in Quebec are more anxious and aggressive than they were a decade ago, even though children elsewhere in Canada did not show big changes. Quebec children also learn to use a toilet, climb stairs and count to three at later ages, on average, than they once did. The effects weren't so great for parents, either. More of them reported being depressed, and they were less satisfied with their marriages — which also didn't happen in other provinces."

Before both sides of the mommy wars start sharpening their knives, there are some important caveats to keep in mind. The poor results were most pronounced for those children who were placed in day care their first year, and I would have to agree that babies are probably better off at home with a parent, nanny or relative giving them one-on-one attention. The results were murkier, though, for toddlers and preschoolers, and in fact numerous studies have found that toddlers and preschoolers in high quality daycare do better than children kept at home on many measures. The study also found that the daycare centers had very high child-to-caretaker ratios. If they had been better staffed, the outcomes may have been different.

I second Leonhardt's suggestions (full disclosure--Leonhardt once worked at BusinessWeek and is well-remembered here as smart, a good writer and a nice guy):

The big lesson from Quebec is that parents really do need more support, but they need the kind of support that allows them to choose what is best for their family. Mothers and fathers should get paid time off after a baby is born, and the money should come from a government insurance program, as it does in Canada, England and other countries. Companies need to be given incentives to create more part-time jobs that don't derail careers — and then find some up-and-coming men who want those jobs. High-quality preschool programs should be available for every low-income child and perhaps universally.

His vision must sound Nirvanalike to many, I realize, but as Leonhardt concludes: "Why don't we just decide that our children are worth it?"

If you want to check out the entire study, click here. And also read some of the reader responses to Leonhardt's column.

Before it's here, it's on the Bloomberg Terminal. LEARN MORE