United Way of Northwest Michigan and Networks Northwest hope a new $100,000 grant will move the needle toward solving the regional child care crisis. The organizations will use the funds to improve advocacy efforts, work with local governments to remove barriers, and target recruitment efforts to areas with the highest child care needs. 

The money comes from the Early Childhood Investment Corporation (ECIC) and its Child Care Innovation Fund, designed to curb the estimated $2.88 billion in losses Michigan’s economy suffers each year due to its insufficient child care system. In 2023, the ECIC awarded a series of grants to establish “Regional Child Care Coalitions” throughout the state. Networks Northwest received $150,000 to lead the way for “Economic Development Region 2,” which consists of Antrim, Benzie, Charlevoix, Emmet, Grand Traverse, Kalkaska, Leelanau, Manistee, and Wexford counties.

“The ECIC wanted to invest in planning projects that were really connected to economic development,” Networks Northwest CEO Janie McNabb says of that initial grant. “I think they were seeing a lack of activity and connection across the business community, and felt there wasn't enough recognition of the child care crisis being a barrier to economic development. So, they put these grants out for creating regional plans that would aim to increase the availability and affordability of quality childcare in different economic development districts.”

The $150,000 grant led Networks Northwest to spend 18 months crunching numbers on the local child care scene and surveying parents, employers, child care providers, and other key stakeholders. The result was a detailed new regional child care plan, which “looks at viable solutions for the 10 counties,” according to McNabb. The new grant to United Way, she says, “is intended to implement those plans.”

While Networks Northwest hasn’t published the final plan yet – “We will be releasing it before too long,” McNabb promises – The Ticker had a chance to review the 115-page document.

According to the report, the region currently “needs full-time care for roughly 2,600 young children” aged 0-4 years. That need is going largely unmet: 68 percent of survey respondents told Networks Northwest they have struggled with availability of child care, and 65 percent have run up against challenges related to cost of care.

While the report identifies five “root causes” for northern Michigan’s lack of adequate child care resources – including things like workforce gaps and barriers to entry for providers – McNabb believes the problem mostly comes down to the issue at the very top of the list.

“It’s a broken business model,” McNabb says of child care as it exists today. “We're relying on traditional market forces that simply do not work. These child care businesses can't really charge enough to cover their true costs and pay a decent wage, because families can't afford to pay what it would take to do that. And as a result, we don’t have enough child care providers.”

The core of the Networks Northwest report is a list of 14 proposed solutions for northern Michigan’s child care woes. Some of those could be rolled out locally, like developing an incubator system for new child care businesses. Others are bigger picture, like pushing for universal preschool programs, something Governor Gretchen Whitmer has been working to bring to Michigan.

Tackling all of those solutions will take time, collaboration, willpower, and money, and is too much for one grant to support. So says Norika Kida Betti, the early childhood system coordinator for United Way of Northwest Michigan. The period for the new grant is only six months, from April through September, which led to some difficult decisions about where to put focus.

Ultimately, Kida Betti says United Way identified three top priorities for the six-month grant: 1) “offering stakeholder training on developing messaging and tools for advocacy with state policymakers”; 2) “educating local governments on zoning language that will remove barriers to opening new child care businesses”; and 3) “targeting recruitment efforts to locations of highest need, as identified by the regional planning process, to increase the number of child care businesses.”

Longer term, Kida Betti and McNabb hope the ECIC will continue funding the regional child care coalitions for another five years. Continuous funding, they say, would allow for a much more holistic approach to the regional child care plan and its 14 proposed solutions.

“The ECIC has identified a source of funds that could be sustained, but I believe it would need to be allocated on a fiscal year basis, which for them starts on October 1,” McNabb explains. “That’s why this grant is only for six months. Eventually, the idea is for the funding to be year-to-year, with a new appropriation every 12 months. So, sustainability [for the coalitions] should be pretty good, if that funding is approved.”

A report published last week by the Michigan Center for Data and Analytics and the Department of Labor and Economic Opportunity shows that northern Michigan isn’t the only part of the state struggling with child care. According to that report, “noticeable inequities” within child care occupations are leaving Michigan short-handed, regardless of county or region. In particular, the report notes that, while the statewide median hourly wage is $22.57 across all jobs, child care workers only earn a median of $13.88, while preschool workers make $17.65.

Figuring out a way to close those wage gaps, McNabb says, will likely be the most crucial factor in deciding whether or not northern Michigan can ever have a stable child care environment.

“As economic pressures mount, the people in lower-paid child care positions are forced to look elsewhere,” she tells The Ticker.  “Right now, those individuals can make more in fast food or retail, and they have to support their families. So, if there is a linchpin issue in this crisis, I believe it is the wages of our child care workforce.”