University of Wisconsin-Milwaukee
Employment and Training Institute

Summary

Barriers to Employment: NSAF Findings on Preschool Children, Mothers' Employment Status and Child Care Choices

by John Pawasarat, Employment and Training Institute, University of Wisconsin-Milwaukee, May 2002

The complete report on U.S. findings is available in PDF.
The complete report on Milwaukee County findings is available in PDF.

National Findings

Data from the 1997 and 1999 National Survey of America's Families on the employment patterns and child care choices of mothers with preschool children (under age 5) were analyzed for families with low-income (at less than 150 percent of the federal poverty level), mid-range income (at 150-299 percent of poverty), and upper-range income (at 300 percent or more of poverty). (1)

  1. Low-income preschoolers are least likely to have a mother who is married or who has a high school diploma. Nationally, 60 percent of low-income preschoolers had a mother with a high school diploma, compared to 86 percent of children in families with mid-range incomes, and 97 percent of children in families with upper-range incomes. In 1999, 57 percent of low-income preschoolers had married parents versus 85 percent of those in families with mid-range income and 94 percent of those with upper-range incomes.

  2. Women with preschoolers remain a difficult population to engage in full-time employment. Almost two-thirds of mothers of low-income preschoolers are not employed at all. This did not change during early TANF implementation, with 64 percent of children not having an employed mother in 1997 and 63 percent not having an employed mother in 1999. There was, however, a slight increase in mothers employed full time, rising from 16 percent in 1997 to 19 percent in 1999.

  3. The majority (57 percent) of low-income preschoolers with employed mothers are not in full-time child care, and those in full-time care are more often in low-cost relative care. For unsubsidized low-income families, costs of full-time care of preschoolers with relatives averaged $129 a month in 1999 versus $302 a month for non-relative full-time care.

  4. The subsidized child care choices contrast sharply with those of non-subsidized low- income mothers. In 1999, 48 percent of unsubsidized low-income preschoolers in full- time care were in relative care compared to 10 percent of preschoolers with subsidies from the welfare department, social service agencies and other agencies. In 1999, 21 percent of unsubsidized low-income preschoolers were in group care while more than two-thirds of TANF- type subsidized preschool children were in non-group care.

Milwaukee County Urban Findings

Milwaukee County was the only county to be oversampled in the NSAF 1997 and 1999 surveys, and Wisconsin was one of the 13 states separately surveyed. Wisconsin also imposed a very strict work test for the welfare population in Milwaukee County as early as 1996, which for the first time required participation of women with children as young as 13 weeks at very high levels of engagement and which resulted in dramatic decreases in the AFDC caseload. For the complete Milwaukee County summary, see Addressing Barriers to Employment: Findings from the National Survey of America's Families for Milwaukee County Families with Preschool Children, 1997 and 1999.

  1. Milwaukee County low-income preschoolers were much less likely to have a mother who was married or who had a high school diploma than children in rural and smaller urban areas of the state. When Milwaukee County is compared to the rest of Wisconsin, only 35 percent of low-income preschoolers have married parents, in comparison to 53 percent in the "balance of Wisconsin." In Milwaukee County 56 percent of low-income preschoolers have a mother with a high school diploma, in comparison to 75 percent in the "balance of Wisconsin."

  2. Employment levels of mothers of preschoolers were considerably higher in Wisconsin and in Milwaukee County than in the rest of the nation, with significant differences between Milwaukee County and the "balance of Wisconsin." In Milwaukee County 51 percent of preschool children from low-income families did not have an employed mother in 1999, compared to 39 percent in the "balance of Wisconsin" and 63 percent in the national survey. In Milwaukee County 28 percent of low-income preschoolers had a mother employed full-time (40 hours or more), compared with 39 percent in the "balance of Wisconsin" and 19 percent in the national survey.

  3. Despite the imposition of a strict work requirement for mothers of preschoolers receiving income support, employment levels for mothers of low-income preschoolers did not change in Milwaukee County in 1997 and 1999, remaining at 51 percent. The percent of low-income preschoolers with mothers employed full-time appears to have increased from 22 percent in 1997 to 28 percent in 1999.

Introduction

Welfare employment programs have historically excluded mothers with young children from work requirements, in part because subsidized child care costs for this population are very high and the likelihood of employment success relatively low. Most recent welfare reform efforts to reduce public assistance caseloads focused first on strategies targeted to those parents already employed (whether reporting income or not), families with older children, and parents with higher levels of education -- in other words those families most likely to leave welfare without expensive public intervention. The welfare population with younger children is still commonly seen as a difficult one to serve, particularly when headed by a single mother with a lower level of education. Engaging an increasing portion of this population in employment will have a considerable fiscal impact on welfare reform expenditures.

The report focuses special attention on the estimated 5.8 million preschoolers in 1999 from low- income families, examining their parents' marital status, mother's employment status, family child care choices, subsidies and costs. The estimated use of public subsidies supported by TANF (Temporary Assistance for Needy Families) and CCDF (Child Care and Development Fund) and the potential impact of engaging a larger share of mothers with preschool children in employment are explored, using the 1997 and 1999 surveys as a description of the early TANF experiences.

I. Employment Patterns of Mothers with Preschool Children Have Changed Little

The employment rates of mothers of preschoolers were compared for the 1997 and 1999 surveys.

  • The majority of low-income preschoolers did not have an employed mothers. In 1997, 64 percent of preschoolers from low-income families did not have an employed mother and in 1999, 63 percent did not have an employed mother.

  • For preschool children from low-income families, the percentage of mothers employed full-time did show a slight increase, from 16 percent in 1997 to 19 percent in 1999, while the percentage with a mother employed part-time remained the same (25 percent).

  • For preschool children in mid-range income families (with income at 150-299 percent of poverty), the percent with employed mothers rose from 26 percent in 1997 to 30 percent in 1999, and those with mothers employed from 20-39 hours a week rose from 15 percent to 17 percent.

    Table 1:


    Status of Children Under Age 5 by Income Level and Mother's Employment
    National Survey of America's Families, 1997 and 1999
    1997 SURVEY Family Income as a % of Poverty Level:
    Less than 150% 150-299% 300% or above ALL
    Estimated total number of children 5.1 million 5.3 million 6.6 million 17.9 million
    % of children in 2-parent families 57% 85% 95% 79%
    Percent of children
    where mother is:
    Employed full-time (40+ hours) 16% 26% 40% 28%
    Employed 20-39 hours/week 13% 15% 19% 16%
    Employed 1-19 hours/week 7% 11% 11% 9%
    Not employed 64% 48% 30% 47%
    TOTAL 100% 100% 100% 100%

    1999 SURVEY Family Income as a % of Poverty Level:
    Less than 150% 150-299% 300% or above ALL
    Estimated total number of children 5.8 million 5.9 million 7.1 million 18.7 million
    % of children in 2-parent families 57% 85% 94% 80%
    Percent of children
    where mother is:
    Employed full-time (40+ hours) 19% 30% 40% 30%
    Employed 20-39 hours/week 13% 17% 21% 17%
    Employed 1-19 hours/week 5% 8% 9% 8%
    Not employed 63% 45% 30% 45%
    TOTAL 100% 100% 100% 100%

    Graph 1:

    Employment
Status of Mothers with Preschool Children

    Economic well-being, the mother's employment status and child care needs have much to do with marital status.

    Table 2:


    Marital Status in Household of Children Under Age 5
    National Survey of America's Families, 1999
    Family Income as a % of Poverty Level:
    Less than 150% 150-299% 300% or above
    Married parents 57% 85% 94%
    Married parents, both employed 15% 39% 64%
    Married parents, both employed 40+ hours/week 7% 18% 35%

    Full-time employment levels are very low for the mothers of preschoolers and do not appear to differ much for children under age 2 compared to children ages 2-4.

  • Low-income mothers of children under 2 were employed full-time in 18 percent of cases and mothers of 2, 3 and 4 year olds were employed full-time in 19 percent of cases in 1999.

  • Children in families at 150-299 percent of poverty showed somewhat higher rates of employment, with 24 percent of mothers employed for children under age 2 and 34 percent of mothers employed for preschool children ages 2-4 in 199.

  • Employment rates were highest or families with income at 300 percent of poverty and above; 39 percent of infants and toddlers (under age 2) had an employed mother and 41 percent of preschool children (ages 2, 3 and 4) had an employed mother in 1999.

    Table 3:


    Employment Patterns of Mothers of Children Under Age 2 and Ages 2-4 Years
    National Survey of America's Families, 1999
    Family Income as a % of Poverty Level:
    Less than 150% 150-299% 300% or above
    Children under age 2
    whose mothers are:
    Employed full-time (40+ hours per week) 18% 24% 39%
    Employed 20-39 hours per week 14% 17% 21%
    Employed 1-19 hours per week 6% 9% 8%
    Not employed 62% 50% 32%
    TOTAL 100% 100% 100%
    Children ages 2-4
    whose mothers are:
    Employed full-time (40+ hours per week) 19% 34% 41%
    Employed 20-39 hours per week 13% 16% 21%
    Employed 1-19 hours per week 4% 7% 9%
    Not employed 64% 43% 29%
    TOTAL 100% 100% 100%

    Even half-time (plus) employment of mothers is limited among the population of children under five.

    II. Child Care Choices for Preschool Children by Age

    While employment patterns are similar for mothers of preschool children regardless of age, child care choices clearly differ. For very young children (under age 2) with mothers working 20 or more hours per week, the child is much more likely to be at home and have no outside child care than is the case for preschoolers ages 2-4. This is particularly the case for two-parent families. (2)

    Table 4:


    Hours of Care for Children of Mothers Employed 20 or More Hours per Week
    National Survey of America's Families, 1999
    Family Income as a % of Poverty Level:
    Hours per Week in Care Less than 150% 150-299% 300% or above
    For children under age 2:
    None 26% 29% 25%
    1-19 11% 15% 12%
    20-39 21% 22% 26%
    40 and above 42% 33% 37%
    TOTAL 100% 100% 100%
    For children ages 2, 3 and 4:
    None 18% 15% 12%
    1-19 13% 18% 12%
    20-39 26% 22% 33%
    40 and above 43% 45% 43%
    TOTAL 100% 100% 100%

    For those children in care for 40 or more hours per week, relatives are the clear choice for infants and toddlers (under age 2) and non-relative care for preschoolers ages 2 and above.

    Table 5:


    Type of Care Giver for Children in Full-Time Care
    (with Mothers Employed 20 or More Hours per Week, Care Subsidized or Not)

    National Survey of America's Families, 1999
    Family Income as a % of Poverty Level:
    Type of Full-Time Caregiver Less than 150% 150-299% 300% or above
    For children under age 2:
    Relative caregiver 57% 49% 36%
    Group center 27% 22% 25%
    Non-relative caregiver 19% 27% 29%
    For children ages 2, 3 and 4:
    Relative caregiver 26% 32% 20%
    Group center 30% 40% 48%
    Non-relative caregiver 18% 19% 19%

    Totals do not add up to 100 percent. In some cases, children use a combination of providers to obtain 40 hours of care and in other cases two providers each give the child 40 hours or more of care.

    III. Subsidized Child Care for Preschoolers

    Families in the National Survey of America's Families were asked to indicate the source of child care payments when others help pay for part or all of their child care expenses. Sources may include the welfare department, social service agencies, other agencies, parents, employers, sliding fee scales, etc. and reflect care subsidies given to the family. While TANF/CCDF was not identified as the source of funding, it is likely to include subsidies provided by the welfare department, social service agencies and other agencies.

    Table 6:


    Employment Status of Mothers of Preschool Children Receiving Subsidized Child Care
    National Survey of America's Families, 1997 and 1999
    Mother's Employment Status 1997 1999
    Not employed 43% 29%
    Employed 1-19 hours per week 4% 5%
    Employed 21-39 hours per week 26% 27%
    Employed 40+ hours per week 27% 39%
    TOTAL 100% 100%

    Table 7:


    Type of Care for Preschool Children Receiving Subsidized Child Care
    National Survey of America's Families, 1997 and 1999
    1997
    Percent
    1997
    Number
    1999
    Percent
    1999
    Number
    Type of Care (39 or More Hours per Week):
    Relative care 10% 25,634 19% 85,958
    Non-relative, non-group care 19% 49,461 15% 68,345
    Group care 71% 181,934 66% 303,811
    TOTAL 100% 257,029 100% 458,114

    Graph 2:

    Growth of
Subsidized Care for Preschool Children in Care 39+ Hours/Week

    TANF/CCDF funding appears to have had a significant impact on the choices or assignments of low-income children to child care by age as well.

    Table 8:


    TANF/CCDF Impact on Child Care Choice/Assignments for Preschool Children
    National Survey of America's Families, 1999
    Family Income as a % of Poverty Level:
    TANF/CCDF
    Population*
    Less than 150%
    (non-subsidized)
    150-
    299%
    300%
    or above
    Type of Full-Time Care (Subsidized Care)
    (Non-Subsidized Care)
    For children under age 2:
    Group 56% 10% 19% 26%
    Non-relative caregiver 22% 18% 26% 30%
    Out-of-home relative 9% 12% 43% 21%
    In-home relative 4% 44% 11% 14%
    Combination of settings 9% 16% 1% 9%
    TOTAL 100% 100% 100% 100%
    For children ages 2, 3 and 4:
    Group 51% 22% 32% 46%
    Non-relative caregiver 12% 20% 20% 21%
    Out-of-home relative 12% 22% 17% 11%
    In-home relative 3% 12% 18% 6%
    Combination of settings 22% 24% 13% 16%
    TOTAL 100% 100% 100% 100%

    *The TANF/CCDF population was estimated from those families with subsidized child care from the welfare department, social service agency or other agency.
    **Non-subsidized families are those without any help or sliding fee schedule.

    IV. TANF/CCDF Subsidies and the Demand for Low-Income Child Care

    Most of the 5.8 million low-income children under 5 years of age in 1999 were likely not eligible for employment-related TANF/CCDF child care subsidies because families members were not employed at required levels. State eligibility requirements for the TANF/CCDF subsidy vary considerably, but typically in two-parent families both parents are required to work full-time. In the 1999 NSAF Survey, 57 percent of low-income children under 5 years of age were in two-parent families.

    Most low-income two-parent families do not appear eligible for TANF/CCDF child care subsidies.

    V. How Much Do Unsubsidized Working Mothers Pay for Child Care

    Most discussions of child care costs, co-payments and rate structures revolve around the costs of government-regulated care. Federal and state initiatives have emphasized upgrading the quality of child care through accreditation and increasing the capacity of licensed care centers to meet the child care demands of the TANF populations entering the workforce.

    The National Survey of American Families provides a rich data base from which to examine the largely unasked questions of what unsubsidized families are willing to pay for child care and what type of care they choose, i.e., the demand side of the child care equation. In both the 1997 and 1999 surveys, child care choice, hours of parents' employment and child care usage were detailed. The survey also collected data on family expenditures for child care and the degree to which families' child care costs were subsidized by the welfare department, sliding fee scales or other sources. (3)

    The surveys showed patterns and costs for full-time day care for 1997, the year just prior to implementation of TANF, and then again in 1999 during a time of rapidly declining welfare rolls. Of particular concern here is the population of young children (under age 5) requiring full-time care while their mothers are employed.

    The 1997 and 1999 NSAF surveys detail the spending patterns and child care choices for children of employed mothers with no subsidies. These data provide a useful picture of what unsubsidized families are willing to spend for full-time child care. For children under age 5 in full-time unsubsidized care, the following patterns emerge:

    Table 9:


    Preschool Children in Full-Time Unsubsidized Child Care
    National Survey of America's Families, 1997 and 1999
    Family Income as a % of Poverty Level:
    Year Less than 150% 150-299% 300% or above ALL
    Average monthly total costs of child care for the family* 1997 $232 $304 $501 $400
    1999 $205 $290 $455 $369
    % in full-time care with relatives 1997 35% 31% 15% 23%
    1999 48% 41% 25% 33%
    % in full-time group care 1997 18% 29% 49% 38%
    1999 17% 18% 39% 33%
    % in non-relative, non-group care 1997 40% 26% 28% 30%
    1999 21% 22% 23% 23%

    *Note: Child care costs are reported for all children in the family. Percentages do not total 100 because in some cases combinations of care settings are used which total 40 or more hours.

    Table 10:


    Average Monthly Costs of Unsubsidized Child Care for All Family Members by Type of Care
    National Survey of America's Families, 1997 and 1999
    Family Income as a % of Poverty Level:
    Year Less than 150% 150-299% 300% or above ALL
    Full-time child care with relatives 1997 $153 $169 $247 $192
    1999 $129 $156 $265 $189
    Full-time child care with non-relatives 1997 $279 $367 $549 $468
    1999 $302 $415 $533 $477

    Because of the way the NSAF was constructed, child care costs are only reported for the amount paid for all child care for all children in the family. It is therefore possible that the child care costs for a family with a preschooler include costs for other preschool or school-age children. In the 1997 survey it is possible to identify the number of preschool children in the family.

    Table 11:


    1997 Average Family Monthly Costs of Unsubsidized Child Care
    for Families with Children under Age 5 in Full-Time Care

    National Survey of America's Families, 1997
    Family Income as a % of Poverty Level:
    Less than 150% 150-299% 300% or above ALL
    Families with only 1 preschool child $237 $256 $411 $342
    Families with 2 or more preschool children $225 $398 $716 $518

    Endnotes

    1 The National Survey of America's Families collected information on children, adults (under age 65) and families living in non-institutionalized settings. Low- income households were oversampled, and special samples were conducted for Milwaukee County and for the State of Wisconsin. This analysis focused on preschoolers with a mother either in a single-parent or a two-parent household; children with no mother in the household were excluded from the analysis (i.e., children of single-parent fathers, in foster families or in families with no biological or adoptive parent present). The employment status of the mother was the focus of analysis; if the mother was not the most knowledgeable adult responding, her employment status was taken from the appropriate adult data. Family income levels were for the prior year. For a detailed description of the survey and methodology, see the Urban Institute's website.
    2 In the NSAF, relative care does not include care by a parent or other family member living in the household. Only child care by non-household members is considered in the analysis.
    3 The NSAF provides a child-based analysis of the type of child care and hours in care. Data on child care costs are aggregated for the family unit.


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