Increases in childcare subsidy rates from the state and a bill that would allow daycare centers to set up shop in mixed-use buildings: These two new developments could offer some long-needed relief for Traverse City’s childcare shortage. But according to Mary Manner, who serves as interim co-director for the Great Start to Quality Northwest Resource Center, the issue is so complex and deeply rooted that solving it completely will be harder than most people realize.

What’s actually causing the childcare crisis in northern Michigan? Manner points to three core factors, all of which are combining to create “a perfect storm.” The first challenge is the same one that most local employers seem to be dealing with: staffing.

“There's just not the workforce,” Manner says. “There just aren't the people who are qualified to work in childcare.”

Great Start to Quality is a Michigan-based program that “helps families find the best early learning settings for their children and helps educators improve the care they give to children.” As part of that program, Manner often works with local childcare providers to raise the bar of the care they provide -- including helping daycare centers find new employees.

The problem illustrated: a local daycare center advertised several open positions, got 20 applicants, and scheduled 20 interviews. Only three candidates showed up. One candidate wasn’t up to date with vaccines that Michigan law requires in childcare settings, but promised to get her shots and get back in touch; she never did. The center director offered a job to the second candidate, but never heard back from that person, either. The third candidate took a job elsewhere.

“So, after all that effort, she still doesn't have any new staff,” Manner says.

The second challenge is the ever-increasing regulatory burden put upon providers. From credentialing and licensing to rigorous safety regulations to ratio requirements that must be observed between caregivers and kids, Manner says it’s always a “big uphill push to open a facility, and then to meet all of all of the requirements to stay in business.”

“A lot of people who want to do this work, they want to do it because they love kids and they want to nurture, educate, and care for kids. They aren't necessarily skilled in business practices. But once they’ve opened a childcare facility, all of a sudden, they have to become businesspeople,” Manner notes.

She sees this particular factor as a potential reason for why childcare availability in northern Michigan has dwindled over the past several decades. In particular, she says the area has “seen a big decline in home-based providers,” which used to play a huge role locally. That decline has occurred “hand-in-hand with our more rigorous licensing and quality [standards],” – important benchmarks for protecting children that have nonetheless made it more difficult for would-be childcare providers to get started.

Lastly, Manner cites a chronic undervaluing of childcare services in modern society. The rising standards in childcare quality, she says, have not been accompanied by corresponding pay increases for its workers, and that trend is driving providers out of business and out of the industry entirely.

“We hear it across the region, across Michigan, and across the nation: People aren't willing to do this work,” Manner says. “And part of the reason that they're not willing to do the work is because the pay is awful. Nationally, half of the people who are working in childcare are on some form of public assistance. As we strive for higher and higher quality, we're asking people to get credentials that indicate quality. We're asking people to get associate's degrees and bachelor's degrees, and in some cases, master's degrees. And then we’re going to pay them $10 an hour. We're not realistic about what it actually costs to provide quality childcare.”

So what’s the solution? One thing that would help, Manner says, is boosting Michigan subsidy rates for childcare. Locally, she notes that the Great Start Collaborative recently “ran some numbers with our local providers and figured out that they are collecting, in tuition, about 60 percent of what it actually costs to provide childcare.” That’s because many local parents are “maxed out in what they can afford to pay,” which leaves daycare centers to make up the difference with fundraising, summer camps, and other strategies. Subsidies are available to help parents pay for childcare, but they’re based on existing underpriced market rates. The result, Manner says, is a “feedback loop” in terms of how much money childcare providers can bring in – and how much they can pay for labor.

Just last week, childcare providers in Michigan got some good news when a 40-percent subsidy increase went into effect. Currently, though, that increase is temporary – a use of COVID relief funds instituted by Governor Gretchen Whitmer.

Another potential solution is a pending bill with roots right here in Traverse City. Sponsored by John Roth (R), state representative for Michigan’s 104th District (Grand Traverse County), the legislation would implement several reforms to state childcare regulations, including a revision to a law that currently restricts the ability of childcare providers to co-locate in mixed-use developments.

The idea for the bill, Manner says, was born from discussions around the new mixed-use Commongrounds building under construction on Eighth Street. There are plans to include a childcare facility as part of that development. However, under current state law, Manner says “we were going to have to get a variance for the license, because in that building is an establishment that's going to serve alcohol. And there is a rule that that prohibits, without a variance, the establishment of childcare co-located with businesses that could be potentially dangerous or harmful to children.”

As mixed-use buildings become more common, Manner sees looser co-location rules as one way to increase both the prevalence and accessibility of childcare.

“If we're building all these mixed-use developments in downtown Traverse City, if we're trying to create walkable communities where people don't have to get in their car to drive places, then we have to have childcare in those buildings,” she says. “We have to have childcare downtown again. And we aren’t going to be able to do that if we don’t change the rules about co-location. Because restaurants that are going to open in mixed-use developments, they're going to have liquor licenses. So we need to figure out how to make it possible to have childcare in our city center, where people live and work. Otherwise, families with young children are going to have to drive to the outskirts of town in order to find childcare for their kids.”