By Corey CarlisleThroughout the COVID-19 pandemic, we’ve experienced or empathized with parents trying to work while caring for young children. One study estimates that, on average, a working parent lost around eight hours or one full workday each week—and more for low-income workers and people of color—during the pandemic because of their childcare duties. To ensure essential workers with young children stay engaged in the workforce and support this important backbone of the economy, many banks have stepped up their support for and collaboration with community-based nonprofits offering funding and supportive services to childcare providers.
Approximately one-third of the U.S. workforce consists of working parents. Millions rely on home-based providers to care for their children. Yet, much of this industry is comprised of small businesses—many very small and very often run by women—that are on the brink of collapse and may not reopen. Adding to the multitude of challenges in operating these businesses, childcare facilities in many states are or were operating under reduced capacity and social distancing orders. According to the National Association for the Education of Young Children, only around 25 percent of the childcare market received a Paycheck Protection Program loan during the first round. With millions of families relying on childcare as critical connective tissue for families and communities, the health and vitality of this sector will do much to ensure Americans can quickly return to work and to support our nation’s overall economic recovery.
Abilene, Texas-based First Financial Bancshares and Scott Dueser, its chairman, president and CEO, knew the role of childcare providers in ensuring that the economy kept going, even in the midst of the school shutdowns that were just beginning and which continue today in many parts of the country. First Financial called on community leaders and formulated a sustainable plan that drew local nonprofits.
The United Way of Abilene stepped up to the plate and partnered with YMCA, Boys and Girls Club, and the Alliance for Women and Children, among others, with emergency approval to use nearly $25,000 per week for free daycare for essential workers from a fund originally designated to assist local nonprofits and service providers. First Financial remains one of the United Way of Abilene’s largest corporate campaigns.
“First Financial will always be committed to our community partners who keep our local economies Texas Strong, especially during the pandemic,” says Dueser. “Creating a strong bond with our early education organizations and partners organized and funded by the United Way of Abilene to ensure essential workers have access to excellent childcare is so important to keep our employees working and the economy going.”
Meanwhile, the Low Income Investment Fund—one of the nation’s leading community development financial institutions, supported in large part by grants and other funding from banks—supports sustainable, community-based systems for financing and developing childcare facilities through capital investments and capacity building. LIIF provides grant and loan capital for facilities development and improvement. In combination with these loans, LIIF delivers specialized business support and development, including training and technical assistance on facilities design, development, financing and operations.
Since the start of the pandemic, LIIF has provided grants, technical assistance and PPP funds worth over $23 million to nearly 400 family childcare business owners. These funds helped pay for expenses like rent, mortgage, payroll, cleaning supplies and safety equipment—ultimately helping an estimated 700 providers stay open or reopen their businesses. In November 2020, thanks to a grant provided by LIIF to close a fundraising gap after another funder pulled out as a result of COVID-19, a new Kidspace center that offers free care and education to families in need was opened in Washington, D.C.
The pandemic has underscored the key role childcare plays in the economy—both in making sure essential workers with young children can get to their jobs and in helping parents stay engaged in the workforce so they can support economic recovery.
Corey Carlisle is executive director of the ABA Foundation.