ICYMI: At Hearing, Warren Calls for Investments in Child Care for Military and Civilian Families to Strengthen the American Workforce
“I'm all for building a strong defense manufacturing workforce, the topic we're here today to discuss. But let’s treat it like the supply chain issue that it is and address root causes like underinvestment in child care and dependent care and child care workers.”
Washington, D.C. – At a hearing of the Senate Committee on Armed Services, U.S. Senator Elizabeth Warren (D-Mass.) called for significant investments in child care workers to provide affordable and accessible child care to military and civilian families and ensure the defense manufacturing workforce has the workers it needs to meet national security needs.
In questioning, Dr. Simon Johnson, an economist at the Massachusetts Institute of Technology and former Chief Economist of the International Monetary Fund, highlighted the need to increase the number of child care workers in order to meet the needs of families who need it. Dr. Johnson said the child care market is “failing us here” because child care centers cannot afford to pay workers more, and parents cannot afford to pay child care workers enough to attract new workers.
“The lack of adequate child care obviously limits the ability of women to participate in the workforce,” Dr. Johnson said. “ I think [federal government investments in child care] would strengthen the defense workforce, more women would be able to go to work, you'd also have more opportunity for women to build the skills that we've all been talking about or emphasizing, across all range of skills, earlier on in their careers. So instead of having to take some years out of the labor force, they would continue to be engaged.”
Senator Warren called for investments in higher pay for child care workers, including in DoD’s child care program – which would increase child care supply and in turn increase overall labor supply in the economy, including in the defense workforce.
Transcript: To receive testimony on evolving workforce dynamics and the challenges for defense acquisition and defense industrial base personnel
U.S. Senate Committee on Armed Services
Tuesday, February 28, 2024
Senator Elizabeth Warren: Thank you, Mr. Chairman. And thank you for holding this hearing on workforce dynamics. You know, the strong economic recovery under President Biden is a win for the United States, we have 14.8 million jobs created, fastest growth in real inflation-adjusted wages of any recovery in more than half a century.
But there is still work to do. We need to invest in our defense manufacturing workforce and make sure that we have the workers that are needed to meet our national security needs. One tool that I'd like us to talk about for making sure that the labor supply keeps up with the labor demand is providing the quality, affordable child care that workers need, so they can actually go to work.
You know, we do this to some degree already, including with the DoD’s excellent child care program. But while we could invest a whole lot more for our military and our civilian families, over half of Americans right now live in child care deserts, that means children outnumber the child care slots by three to one. And that means millions of families across the country that need child care, and either can't find it, or if they can find it, they can't afford it.
Professor Johnson, you're an economist at MIT, former Chief Economist at the IMF. So let's do some Econ 101 and drill down on the root of this problem. How does insufficient supply of child care affect labor supply, including the defense workforce?
Dr. Simon H. Johnson, Ronald A. Kurtz (1954) Professor of Entrepreneurship at the Massachusetts Institute of Technology Sloan School of Management: The lack of adequate child care obviously limits the ability of women to participate in the workforce. And of course, many of those aircraft carriers and submarines that were built in World War II were built by women.
Senator Warren: So not enough child care means not enough workers to power our economy in the defense industry, and basically, everywhere else. But let's go down one more level on this. Professor Johnson, help us understand the bottleneck in child care. If we want to increase the supply of child care, what's the key input that we need more?
Dr. Johnson: You need more people willing to work in the child care sector.
Senator Warren: Okay, so we need more child care workers to help unlock this labor supply across the board. How can we do that? Why don't we just pay child care workers more money?
Dr. Johnson: Well, that is the best idea and I think that is what would work. But just to emphasize, these child care centers, for the most part, operate on razor-thin margins, so there's not much else to squeeze. The money that's paid by parents goes to the child care workers, but the parents can't afford to pay the child care workers enough to pull people into that child care work. So the market I'm afraid, Senator Warren, is failing us here.
Senator Warren: Okay, so the market fails. But DoD has stepped up, DoD child development centers cap fees at 7% of family income, and then the federal government picks up the rest of the cost. It is a worthwhile investment in military readiness.
But DoD has not updated its pay scale for child care workers for 30 years now. And unsurprisingly, DoD is struggling to attract the workers it needs. Meanwhile, federal investments in civilian child care fell off a cliff last year when the pandemic funding ended. And that exacerbated child care shortages.
So Professor Johnson, if the federal government stepped up its investments in child care, particularly to increase child care worker pay, what impact would that have on the defense workforce?
Dr. Johnson: I think it would strengthen the defense workforce, more women would be able to go to work, you'd also have more opportunity for women to build the skills that we've all been talking about or emphasizing, across all range of skills, earlier on in their careers. So instead of having to take some years out of the labor force, they would continue to be engaged. And that's really important for having supervisory talent, for example, when you reach a certain age.
Senator Warren: And I take it, Mr. Taylor, do you agree with this?
Johnny C. Taylor, Jr., President and Chief Executive Officer, Society for Human Resource Managers: Not only do I agree, it's an issue that you're increasingly seeing on the private sector side, corporations are underwriting and then we don't have a 50 year old lag in terms of compensation. So many, increasingly organizations are building their own child care facilities and fully subsidizing them to draw talent and to retain that talent.
The other thing though, Senator Warren that I think is really important is increasingly we speak about, and we're seeing this in all of our data, it's dependent care, so more than just child care. Many of us find ourselves in the middle of this sandwich generation where you have to decide not to go take a job because no one is there to provide for your elderly parents or grandparents. So we are seeing a big theme and all of our data that says not only child care, but broadly dependent care.
Senator Warren: So I think this is terrific. You know, I'm all for building a strong defense manufacturing workforce, the topic we're here today to discuss. But let’s treat it like the supply chain issue that it is and address root causes like underinvestment in child care and dependent care and child care workers.
I'm glad to be working with members of this committee to invest in the DoD’s child care program. I want to call out my partner in this Senator Scott. We're working on this in our subcommittee, and we're going to keep fighting for affordable child care for our defense workforce and for all Americans. Thank you, Mr. Chairman.
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