Child Care

Since 1988, Congress has created four child care programs for low-income families. Two of them subsidize child care for welfare recipients who are trying to become self-sufficient through education, training, and employment. Two others provide child care subsidies to working poor nonwelfare families. GAO found that reducing child care costs increases the likelihood that poor, near-poor, and nonpoor mothers will work. This effect is strongest for the poor and near-poor mothers. More specifically, GAO predicts that providing a full subsidy to mothers who pay for child care could boost the percentage of poor mothers who work from 29 to 44 percent and that of near-poor mothers who work from 43 to 57 percent. By comparison, the probability of nonpoor mothers working could increase from 55 to 65 percent. GAO concludes that among the factors that encourage low-income mothers to seek and keep jobs--factors such as more education, training, and transportation--affordable child care is a decisive one. Thus, any effort to move more low-income mothers from welfare to work will need to take into account the importance of child care subsidies to the likelihood of success.

GAO found that: (1) reducing child care costs increases the likelihood that poor, near-poor, and nonpoor mothers will work; (2) providing a full subsidy to mothers who pay for child care could increase the proportion of poor mothers who work from 29 to 44 percent, near-poor mothers who work from 43 to 57 percent, and nonpoor mothers who work from 55 to 65 percent; (3) affordable child care is a decisive factor that encourages low-income mothers to seek and keep jobs; and (4) any effort to move more low-income mothers from welfare to work will need to take into account the importance of child care subsidies to low-income working families.