Benu Chhabra: The reason I left was I was left alone with 22 kids.

Jamee Herbert: I'm Jamee Herbert, CEO of BridgeCare, an organization that helps make navigating the minefield of early care and education easier. I've spent years trying to understand why our childcare system feels impossible to work through.

Across this season, we're talking with parents, providers, and experts across the country to unpack how the system really works and why it breaks down. Every episode we'll be looking at a different part of the equation, from economics to the workforce, to the policy barriers shaping what care looks like on the ground.

By the end of the season you'll have a clearer picture of why America's childcare system has been set up to fail. More importantly, we'll find some answers around what we can do to fix it. This is Child Care Matters: Built to Break.

In the last episode we looked at how the system is actually designed and ultimately how those funds flow to childcare providers. This episode we talk about the business and regulatory challenges and get into the very fabric of keeping a childcare program running.

Benu Chhabra: I'm going to say on behalf of others as well, sometimes people think that we are babysitter. We're the one who's helping our children to get ready for the school readiness by providing them those early math skills, language skills.

Jamee Herbert: This is Benu Chhabra. She's an activist and early childhood educator. She has a long history of looking after children. When Benu moved to the US and entered the formal childcare workforce, she learned quickly that loving children isn't enough to make this work sustainable.

Benu Chhabra: I took my son to a preschool and I was asked, "Oh, would you like to be a preschool teacher and like to go to college?" And I thought that was a great opportunity. So they started me as a co-teacher, and then within two semesters I finished all the units and I became a preschool teacher.

When I was working at the school, first of all, paying for your own children was very hard because you're barely making anything, and I was promised something at the first that, "Oh, we going to help you with your childcare." But then again, when after working two weeks, my check was only $47.

Jamee Herbert: The pay was not the only reason Benu left.

Benu Chhabra: The reason I left was I was left alone with 22 kids. So then I decided I was just going to work for myself and I just applied for a license and then I became a licensed educator, and some of my parents from the school followed me because I was the three-years-old teacher in that room and they would drive almost 45 minutes to come to my program and they helped me actually set up my program.

When I opened, I didn't know I already had a teacher's credential that time. I could go large, but I didn't know. So I started as a small family childcare, but then I was asked to go large. So then I applied for a large license, and within one year I was licensed for 14 students.

Jamee Herbert: In childcare, the business plan is often built on relationships. The love of educating young kids is passion that drives the long hours and thin margins, but providers are still operating a business, so they have to look at how to grow and sustain it.

One way is to take on more children. But the sheer number of children required to make these businesses viable is just one of the many barriers they need to overcome.

Wendy Doyle, the president and CEO of United We, has spent years studying how these systems affect women and work, and she understands the difficulty of the system Benu has to navigate.

Wendy Doyle: We are working on another research study, and one thing that we did find that I thought was interesting is in a rural community to be able to break even, just break even, not be profitable, needed to cycle through 151 children to be able to make a profit. And that's a lot of children in a summer-based organization.

You're not in this business to make money. You're not in this business to make money, you're in it because you love to care for children. You got to be able to provide for your family.

Jamee Herbert: It's not just a question of numbers, it's a question of actually being able to expand the physical space. In Benu's case, she started as a small provider where she was licensed to care for six to 12 kids in her own home. She wanted to increase the number so she could care for 14. That brought challenges with licensing and zoning permissions.

Benu Chhabra: So if you're living in a townhome, you have to go through the business permit. And the city of Concord, that's where I live, so I just showed up in the city of Concord and I had to inform the neighbors in my neighborhood because it was so close. But neighbors were very nice and they were very supportive. And so with a smaller fee, I was able to get a permit to run a large licensed family childcare.

Jamee Herbert: For a provider like Benu to grow her program even from 12 to 14 children, she has to get formal approval and often an on-site visit from her licensing specialist just to change her license. That means time, paperwork, and added cost.

She also has to navigate zoning and permitting with the city, which involves a different department, different timelines, more forms and more fees. On top of that, she needs to speak with her neighbors. All of this happens while she's caring for a dozen young children every day, and government offices don't take calls outside of business hours.

Benu Chhabra: Our cities were charging us a business license fee, which if you're licensed to our... We're licensed to our state. So you really didn't need that, but because you're running a business in the city, that time nobody knew and we thought we had to go through the business permit fees and all this.

I, with my mentor, created a small group and we just gathered up and we started educating and advocating for ourselves. One of us stood up and told them, "We don't have a set schedule like schools does. In our homes we provide extended care. We may also have two or three children who are coming from the same families."

Jamee Herbert: Benu and her team were proactive in coming up with solutions to the red tape they encountered. But we can't rely on providers taking time off from their businesses to advocate for themselves at city meetings.

Sarah Rittling: We have federal components that are holding everything up. You have states, you have communities, you have parents, you have employers, and it looks different everywhere you go.

Jamee Herbert: This is Sarah Rittling, the executive director of the First Five Years Fund, a bipartisan advocacy group championing for federal policy to support our childcare and early education system across the country. She has a 10,000-foot view of the regulations and processes that providers like Benu have to sift through.

Sarah Rittling: So you have the big federal programs that sit in here and then they go out into states and communities or programs, and then you have states who are like, "We have a childcare problem." They move faster, they're able to do more policy and priorities than that you are able to. The federal government is great, uniquely driven to their constituents and to the needs of their state, but every governor has a different way of doing that and goes through different agencies and then those agencies talk to each other and then there's just layers of bureaucracy, frankly, that create hurdles to making things fit together in a more tidy, neat way or efficient way that can be then funded.

Jamee Herbert: That tangle of agencies and overlapping rules creates delays and extra costs, and it's exactly why some leaders are pushing for the system to be simpler.

Wendy Doyle: I would love to see some innovation around streamlining the licensing regulation at the city, county, and state level. So in my perfect world, everything is coordinated and streamlined and it's not confusing and there could be a streamlined fee structure as well. And that is a long game, but that's one of our wishes of all this investment in research that we would like to see. Just make it super easy for everyone.

There is a lot to figure out, again, on the health and safety and streamlining and organizing, and certainly we'd love the requirements at all levels of government to be streamlined, but that in itself is we could have a whole dialogue, Jamee, about the fire inspection process.

One provider was talking about how the door opened from the outside in and the fire inspector required the door to go from the inside out, and to be able to make just that change was going to be an $8,000 capital improvement. The childcare provider's like, "I can't do that." And the fire inspector's like, "Well, until you do that, I can't approve you to be able to open your business."

Jamee Herbert: When we talk about cleaning up the red tape for providers, it's important to know that Wendy's not talking about advocating for deregulation. A lot of folks call it rightsize regulation. It's really just trying to look at how do we make the regulation that's in place accomplish the goals of safety and ideally quality of care and education for families?

If we think of opening the doors as the first hurdle, keeping them open every day is another. And the biggest pressure point is staffing, because in childcare, staffing isn't flexible. Ratios of staff to children are fixed and dominate the operation of the childcare provider. One person out can change the entire day.

Wendy Doyle: You hear these stories of, "Oh my gosh, I've got a childcare worker that is sick today, isn't showing up. We've got to close because we're not going to meet the ratio requirement. So you're on your own today." And then families are having to take PTO, stay home from work or do remote work. I mean, it's just that puts families in a jolt.

Jamee Herbert: Imagine your local coffee shop has staff call out all the time. No problem, the manager jumps in to take orders or they shuffle around team members. They don't have to close entirely.

Providers don't have that option. If they operate with less staff, they could be in violation of their license for not keeping kids safe. For family childcare owners like Benu, this staffing challenge can mean something even more basic. You can't step away even for your own health.

Benu Chhabra: As a business owner, as a family childcare educator, you have to be present in your program for 80% of the time, and many of us, including myself, had health issues where we couldn't even leave the program to go even for a regular checkup.

I mean, we work Monday through Friday and there are many of us work almost seven days a week, and you tell me that is there any doctor open after we get off? No. That's why we lack on our annual exams.

And even I talk to many educators on daily basis. Many of them had cancer or heart issues. I myself couldn't go for biopsy. I had to wait to take a day. And we cannot just call in and tell the parents, "Oh, I have a doctor's appointment. I need to take the day off for that." So prolonging our health concerns, like waiting to be seen by the doctor, that's been really, really challenging.

Jamee Herbert: While providers find it tough to step away, hiring and keeping staff is also difficult.

Benu Chhabra: You have a hard time finding an employee. And if you find one, then we're having hard time sustaining them because we cannot compete with Pete's Coffee or the restaurants, because majority of us take care of the children who are coming from lower-income families. And if I'm not making that wage, it's hard for us to pay more than minimum wages to our employees.

Sarah Rittling: The women, frankly, who are providing care day in and day out in a mixed delivery system because the system isn't supported in the way that it needs to, it's unfortunate that they're ultimately not being paid what they deserve to be paid, and it's driving these professionals out of the workforce into other high-paying jobs.

Jamee Herbert: You can't solve staffing without money. And providers can't raise pay without raising tuition, and they know families are already stretched. So providers absorb the gap with their own time, their own health, and their own meager profits, because they want to keep their doors open for families.

Wendy Doyle: There is this debate that you hear in almost every state about the ratio. So the requirement, the number of childcare providers per based on the number of children, and that varies per state.

For infants, it's typically one childcare worker for every two to three infants. It could be one childcare worker for age two and up, could be two to four. So it just, it varies by state. So there's inconsistency in that, but we don't want that to get challenged.

That has to be something that is protecting and keeping our children health and safety. That ratio requirement really dives strongly into dictating why we're having the childcare workforce challenge and why childcare providers are closing because of that requirement. So that's kind of a baseline reason. When you can't keep staff, you can only, you've got requirements too of this ratio, and that's a key point.

Jamee Herbert: Fortunately, there are solutions on the horizon. One is for childcare providers to come together and share the burden of some of the overhead expenses and operational costs.

Wendy Doyle: We've heard about a really interesting model that's just launched. It is in more of a rural community and they are looking more, they did asset mapping of all the childcare for the entire county and they used a little bit of leftover American Rescue Plan Act funds to be able to create a 501(c)(3) organization, and then they kind of co-opt, had all of the providers in the entire county, they are now a member of this 501(c)(3). So they are not operating as an independent business anymore, they're operating under this 501(c)(3) umbrella with trying to do two things.

One, to, through that model, provide healthcare benefits to the childcare workers, and two, when they are in the situation of somebody's sick, that they have this pool, all of these providers that then they can pull from, "Oh hey, X, Y, Z across in the next city, we need to deploy you to this other provider so we can have consistent childcare."

And so far, the early signs are it's pointing in the right direction. And that centralized system is then going to help kind of free up the actual providers of the paperwork, the background checks or the continuing education requirements. So that, to me, speaks to the early point of what United States of America is all about is innovation and creativity, and I think we need to see more of creative ideas like that to be able to help with this problem.

Jamee Herbert: The old adage of we go further together rings true in childcare, but not all providers have access to these kind of resources. That kind of collaboration requires a lot of time, effort, and cooperation to get off the ground. And free time is in short supply for most providers. Luckily, there are glimmers of hope.

Can you share a specific example of something that's been happening in bipartisan federal policy efforts that's given you hope in EC space?

Sarah Rittling: One of the most, I don't know, surprising, pleasantly surprised, eagerly stunningly surprised was the rapid engagement by the business community, small, large, all shapes and sizes of business, which was kind of like a match was lit on that because of COVID, frankly.

And so I think that having the business community, having those voices, having that presence I think has been really, really helpful in a lot of different ways.

And I think a lot of that had to do with the fact that, frankly, parents and maybe soon-to-be parents and all... People really started engaging and having a real conversation publicly that we did not have prior to 2020. I think the personal nature of the choices that you're forced to make at home was very personal. And then we all started living each other's lives in a more real way and it provided a comfort that allowed us to talk about it and then talk about it with our employers and now talk about it with our elected officials in the grocery store, and I think that's been really, really impactful.

Jamee Herbert: As of 2023, only 27% of employees had access to paid family leave. This is incredibly problematic, and particularly because of that 27%, most of them are higher earners. And when you get into lower-income brackets, far less percent of the population has access to critically-needed paid family leave.

This causes parents to return back to work far too early for their child's health and even sometimes safety. And so what we're doing then is we're not providing them with the support that they need immediately following childbirth, and then we're also not providing them with the child's care sufficiently needed once they return to work. These policies go hand in hand to create a strong economy and a strong workforce.

There's one extremely important part of the puzzle that we've not looked at though, the community. After all, it takes a village to raise a child, and childcare providers are a part of that community spirit, not just for the services they provide to each family, but as a foundational part of the local workforce and economy.

A supportive community can be the difference between survival and failure for a provider. More than that, it's a reason to keep going despite the adversity they face. As Benu explains, childcare has to be visible and heard if it's ever going to be valued.

Benu Chhabra: So I had a student, this was many years ago, so I mentioned to you about my program where we do a annual celebration where I also invite our local legislators here. And that student who grew up in my program, he grew up here. And his parents, I mean, we're still connected because in my program when we do this celebration, I invite all the past, present, and the children who are on the waiting list so they get to meet one another.

So the grandpa came, because I always invite grandparents as the children are graduating from my program. The grandpa said to me when he came, he says, "Do you know what you have done here?" And I looked at him because I was kind of a little bit confused.

And just to give you a background, I get over 100 people, 150 people in that day of my event. He said to me, and I remember, this was many years ago, "You have created a village." And I still get emotional because it was a village in India. That's where I grew up.

So I feel like our children and we, we need that village for all of us to grow. Like I said, every day I learn from my students. So that's in my heart what he said to me, and I just want this village to grow. And this is why I feel like parents and educators, we all need to advocate for childcare.

And in our city of Concord parade, we've been doing this for almost, this was our third year. All the parents are coming in there, grandparents come, children come, and it's an amazing experience and this is how we going to be able to change our system.

Jamee Herbert: You do the parade on the Day of Childcare, right?

Benu Chhabra: People are invited, and then the parade is on the July 4th. And I want to see this, whenever I present at the conferences or I speak, I always tell them, "This needs to happen in every city, because signs needs to be held by all the people, 'Childcare is essential.' It needs to be seen, it needs to be heard."

Jamee Herbert: Across this series, we're showing you every piece of the puzzle of the system that has been built to break. And in the next episode, we look at the role policy and legislation plays in our ongoing efforts to fix America's childcare system.

Rep. Kate Farrar: Any legislator will say to pass legislation and to have it be law, it's another thing to implement the law.

Jamee Herbert: We can only fix the system if we first understand why and where it's broken. So subscribe and share this podcast with others who are navigating the system too. And go to getbridgecare.com if you want to learn more about what can be done to help families access high-quality, affordable childcare. The link is in the show description.