Family child care finances and their effect on quality and incentives

Abstract

This study uses detailed financial data from telephone interviews with a subset of regulated and unregulated providers from the Family Child Care and Relative Care (FCCRC) data set to construct a budget of expenditures and revenues for paid family child care providers, and to study monetary incentives to enter the field. The budgets provide insight into the finances of providers of different group size and quality useful to family child care recruiters, trainers, and new providers. Results indicate that income was low compared to female dominated occupations for providers without their own children in care, but not much lower if the provider cared for several children or had her own preschool children. These family child care providers were about as well off financially as child care center teachers. Providers of better quality earned little more than other providers, indicating little monetary incentive to provide good quality or seek additional education or training.